CO129-522-4 China inland water- river and coastal trade- smuggling by British ships 12-12-1929 - 24-3-1930 — Page 14

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SHANGHAI,

January 21st, 1930.

Mr Shigemitsu onlled at 11 a.m. to-day. He had

just returned from Nanking and evidently wished to have a talk on things generally,

but

He began by saying that C. T. Wang had agreed that there were so many things to be discussed between China and Japan that the only method of making progresa was to tackle them one by one, and he agreed with Mr

Shigemitsu that tariff autonomy should be the first;

he had insisted, on the other hand, that all these

separate issues should be dealt with in one treaty and not in separate instruments. Mr Shigemitsu intimated that

Dr Wang had shown most interest in Extra-territoriality

but added that so far his own Government's attitude and

instructions were unknown to him.

Turning to what evidently chiefly interested

him at the moment, he asked whether in my discussions

so far with C. T. Wang anything had been said about

inland water navigation. I told him the subject had not even

been mentioned sincle last June, and I again went

over the whole ground of what I had told Mr Saburi in

Peking last month. Mr Shigemitsu was evidently in some

dilemma as to how this question should be handled. He said it was important to prevent a Chinese press campaign

developping about it. At the same time, the Japanese firm

particularly interested - the Nisshin Kissen Kaisha -

were very stiff and disinclined to any form of compromise.

I told him that in my earlier talks with Wang he had

always got back to the possibility of two solutions: (a) a system of licensing for a period of years, or (b) some

form of Sino-foreign shipping company with 51 per cent

Chinese and 49 per cent foreign capital. I had not felt it worth while sounding our shipping companies on either

of