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the force of public opinion to the policy of nou-importation of arms as to make it difficult for them to recede openly therefrom. If, in spite of public opinion, the Chinese Government do revoke this mandate, we could again consider, in the light of the circumstances of the moment, the suggestion put forward by Mr. Teichman that we should abandon the embargo as far as the Central Government are concerned, that is to say, maintaining it in all cases except where it could be shown that a huchan for the import into China of the arms in question had or would be issued by the Central Government or with the latter's approval. We should in that case be able to fall back on the Geneva Arms Convention, if it were by that time generally accepted and ratified by all concerned. I presume that your despatch No. 799 of the 9th September, forwarding copy of the above convention for my observations, is superseded by your later despatch No. 831 now under reply, and I do not therefore propose to address you a separate despatch commenting thereon. It seems, indeed, that the enforcement of this instrument would produce a very similar situation, as far as China is concerned, to that resulting from the existing arms embargo understanding, that is to say, whatever legislation we ourselves might enact to give effect to article 30 of the convention, the nationals of other Powers enjoying extra-territorial rights in China would probably not be prevented by their own authorities from dealing in arms in China to the order of independent provincial military authorities.
4. Having dealt thus far with the main question, ze., the continuance or otherwise of our arms embargo policy, I come to the subsidiary issues of what, if any, modifications in the actual enforcement of that policy on British subjects are called for. The first step in this connection, and one which should, I think, undoubtedly be taken, would be to remove aircraft definitely from the scope of the embargo agreement, as suggested by Mr. Teichman. The Chinese Government have themselves for years actually included aeroplanes in the list of articles the import of which is prohibited (except to the order of the Government) on the ground that they are classed as military supplies; this arrangement continues in force, but is represented as a temporary restriction, pending the promulgation of new regulations on the subject. As a corollary, therefore, to the exclusion of aircraft from the embargo, the Chinese Government should logically be We need, however, pressed to remove aeroplanes from the list of prohibited imports. scarcely give further consideration for the moment to this aspect of the question, which may perhaps be left to other Powers at present more interested in the Chinese aeroplane trade to raise; for there appears, indeed, to be little prospect under existing conditions in China of any real development of the trade in aircraft except for Government, i.e., military purposes.
I further concur in the view that British interests should be given no encouragement to sell aeroplanes to the Chinese Government except on the safest terms, that no support should be given to any monopoly claims based on old contracts, and that enquirers should be warned that the sale of aircraft to the Chinese for military purposes is against the policy of His Majesty's Government, and that the latter may decline to render any assistance in recovering debts for the cost of any aeroplanes sold to the Chinese Government which might subsequently be used for military purposes.
5. The next point claiming attention is the alleged disadvantage under which British firms are placed by our King's Regulations as compared with the merchants of other nationalities whose legislative systems do not provide as ready a means of enacting local legislation as we possess. This complaint of the British traders concerned, namely, that their hands are tied by an international arrangement which is effectively carried out in China by Great Britain alone, has frequently been mentioned in past correspondence on the subject. It is of course perfectly true that the other Powers concerned mainly confine themselves, in carrying out their embargo obligations, to the control of the export of arms from their countries to China as opposed to the import into, and trade in, China, and, further, that large quantities of Italian arms imported or contracted for prior to the date of the embargo agreement have been since from time to time disposed of to Chinese militarists. But, except in so far as concerns the point which raises a nationals of countries not parties to the embargo agreement, a different issue dealt with later on in this despatch, I am not convinced that these complaints of discriminatory treatment are really well founded; and, in any case, if the trade is considered a bad, and even an immoral, one, in existing conditions in China, it seems difficult to justify any relaxation of our restrictions on British subjects from engaging therein. If, however, the grievance is considered a real one which must be dealt with, the remedy is simple, namely, to withdraw our King's Regulations altogether and to carry out our arms einbargo policy in the future by means of the control of exports alone in the manner suggested in Mr. Teichman's letter. Even in that case we should not, of course, be entirely without means of controlling the trade in China, more
especially while the Chinese mandate of the 2nd September remains in force, since with that mandate in existence any import of arms by British subjects would appear to constitute theoretically an offence under article 74 (ii) of the new consolidated Order in Council. A legal conundrum of some complexity might then arise, namely, whether or not an offence against the Order had been committed if, for instance, with the mandate in force and after the withdrawal of our King's Regulations, a British subject were to import armis, say, into Manchuria, openly through the customs, on the strength of a provincial huchao, issued without reference to, and even against the mandate of, the Central Government, but recognised by the local customs officials.
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6. On the whole, however, I am inclined, after further mature consideration of the problems at issue since the date of my telegram No. 492 of the 17th November, to recommend, for the reasons set forth in the above paragraphs, that we should not withdraw our King's Regulations, but that we should alternatively replace them by new regulations on the lines of those submitted in my despatch No. 610 of the 1st September, with the modification of the deletion of article 18 of the schedule, namely, aeroplanes and component parts thereof. This should do something to remove existing grievances of British interests concerned directly, and indirectly through the supply of materials in the trade, both by the exclusion of aircraft from the scope of our prohibitionary legislation and by the more exact definition of the term "munitions of war referred to therein.
7. With regard to the problem of the supply of arms from countries not parties to the embargo agreement, I feel that you, sir, are in a better position than I am to judge whether any useful purpose would be served by inviting the Governments of such countries, and more especially Russia, to adhere to the embargo. It is needless to say that such adherence is very desirable from every point of view; but, more especially in view of the issue of the mandate of the 2nd September, any invitation or request to the Powers in question to restrain their nationals from exporting arms to parts of China not under the control of the Chinese Government should. I presume, more properly come from the Chinese Government.
8. As regards the question of the Canton arms trade and with reference to the suggestion made by his Excellency the Governor of Hong Kong that, if the Central Government in Peking were to prohibit the importation of munitions except to their own nominees (as they have in theory already done by the issue of their mandate of the 2nd September), His Majesty's Government should then co-operate with them to stop Russian ships at the mouth of the Canton River, and, further, should supply munitions to those anti-Bolshevik groups which are anxious to overthrow the present Government at Canton, I am of opinion that the course proposed might prove dangerous, and I concur in the views expressed by His Majesty's Chargé d'Affaires in his telegram No. 420 of the 24th September that we should leave the Chinese moderates to deal themselves with Bolshevism at Canton and elsewhere, unless and until a Central Government is established of a more representative character and capable of offering greater guarantees of stability than the present one and its predecessors, which might invite our active co-operation in preventing supplies of arms and ammunition from reaching independent "Red" factions, or until the authority of such a Central Government is definitely challenged by the open rebellion of areas or provinces which may have fallen completely under Bolshevik control, when our policy of non-intervention might have to be reconsidered.
I have, &c.
R. MACLEA Y.
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