Office of the Historian

893.24/620: Telegram

The Consul General at Hong Kong (Southard) to the Secretary of State

Hong Kong, October 13, 1939—noon.
[Received 4:30 p.m.]

374. Following from Reed at Hanoi:83

October 11, 6 p.m. My September 26, 3 p.m.

1.
Information said to emanate from authoritative official circles as regards policy to be pursued toward the export and transit of goods to China (those goods which are prohibited export from Indo-China) indicates to a large extent that the French policy vis-à-vis China is still subject to political expediency.
2.
In letters dated October 3d the Governor General notified the Chinese Consul General that the export and transit of these prohibited goods to private concerns in China will be banned after October 13 and that the export and transit of such goods to the Chinese Government will be banned from a date to be announced by the Director of Customs at Hanoi. However, the export and transit of the goods covered by the Universal Trading Company loan to China will be permitted as heretofore.
3.
Subsequent to the receipt of these letters various people have talked with the Governor General and Director of Customs and have received the very definite impression that a more lenient policy than that indicated by these letters will be pursued, provided the congestion of freight at Haiphong be cleared up. I have been informed that it will take more than 6 months to clear up this congestion.
4.
According to Chinese and foreign sources, the French desire to avoid the appearance of active assistance to the Chinese Government. According to a number of these sources, certain Japanese are expected at Haiphong within a week or so and every effort is being bent to force the Chinese to clear up the almost unbelievable congestion. It is rumored that an order has been issued that all gun cars and trucks must leave Haiphong within 3 days regardless of whether they are loaded or not.
5.
The immediate movement of cargo is definitely handicapped by the lack of chauffeurs, by the condition of the road beyond the frontier, [Page 764] which has been repeatedly bombed within the last few days, and by the break in the railway to Kunming which may not be in a position to carry freight for at least a month.
6.
From recent conversations in Hanoi and Haiphong it would appear that for the present the Indo-China Government is disposed to give favorable consideration to shipments to the Chinese Government, especially goods of American origin, but that there is an understandably strong desire to avoid complications with the Japanese, so strong as to warrant the apprehension of restrictions upon the transit of the above mentioned goods to China if and when Japanese pressure becomes urgent.

Repeated to Chungking and Peiping. Saigon informed.

Southard
  1. Charles S. Reed, II, Consul at Saigon on detail to Hanoi.↩