CO129-363 - Public Offices & Others - 1909 — Page 320

40792 1

[This Document is the Property of His Britannic Majesty's Government.]

[B]

CHINA RAILWAYS.

CONFIDENTIAL.

319

[November 30.)

SECTION 2,

[43822]

(No. 197.) Sir,

No. 1.

Sir Edward Grey to Sir C. MacDonald.

Foreign Office, November 30, 1909. I TOOK an opportunity of telling the Japanese Ambassador on the 26th instant that a good deal had passed with regard to the Tsitsihar Railway since I last saw him,

It had come to my knowledge that Messrs. Pauling were acting in co-operation with an American group. I had instructed Sir John Jordan to take no part in the matter and it had gone on quite independently of me, but from what I heard now it was possible that I might be asked to support the project definitely at Peking. I had therefore told the Americans that, though I welcomed American and British co-opera- tion and was favourable to railway development, I must be free to support a request for Japanese participation in this railway if such a request was put forward. "My object was to promote agreement between America, Japan, and China, in order that complications should be avoided.

The Ambassador told me that his Government also had discovered what was going on. They had made enquiries at Peking, and on finding out that Pauling's agent and Mr. Straight, of the American syndicate, had come to an agreement, the Japanese Minister had spoken to Na-tung, telling him that the Japanese expected to be kept informed, as they might be obliged to oppose the railway project if an agreement was concluded without their being consulted. Na-tung had given no absolute promise, but had said that he would bear this in mind. In consequence of what he had beard from Tokyo and Peking the Japanese Ambassador had communicated with Messrs. Pauling here, who had told him that as they found the Chinese objected to Japanese participation it had not been possible to make progress in co-operation with the Japanese, but as far as they themselves (Messrs. Pauling) were concerned they still remained willing to co-operate with the Japanese.

I told the Japanese Ambassador that I had not yet heard what the American view was.

I felt sure, however, that the action of the Americans had not been due to hostility to Japan. It was due, I thought, to their general desire to participate in Chinese railway enterprise-a desire which had first taken shape in their request for participation in the Hankow--Szechuan line, in which Japan was not concerned. When I had explained my views to the American Ambassador here he had received them not at all unfavourably, and I had no reason to suppose that the American Government would object to Japanese participation in the Tsitsibar line. I had pointed out to the American Ambassador that Chinese opposition to Japanese partici- pation might proceed from a real desire to starve or impair Japanese commercial interests in Manchuria, and was at any rate sure to make the Japanese suspect that this was their motive. Until we were asked to take some step at Peking there was no need to carry the matter any further. But I wished the Japanese Government to know in advance, confidentially, what the position was.

The Japanese Ambassador thanked me cordially for what I had told him of our attitude, and said his Government would be pleased to hear it.

I am, &c.

E. GREY.

June

[2486 gg-2]