CO129-567-4 Traffic of arms to China and Japanese air-raids on Kowloon-Canton railway 3-1-1938 - 3-5-1938 — Page 177

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4. I then asked his Excellency as to the progress of peace negotiations, of which I had seen certain reports. The Ambassador replied that I would recollect that some time ago he had reported to me the four peace conditions put forward by the Japanese Government through the German Ambassador. These conditions had not at the time been rejected by the Chinese Government, who had, however, left the Japanese for a long period without any reply. The Japanese Government had then asked repeatedly through the German Ambassador that they should receive a reply, and on the 13th January last General Chiang Kai-shek had finally replied, explaining that elucidation was required on a number of points. Instead of such an elucidation having been provided by the Japanese Government, the latter had issued their statement of the 16th January, in which they had stated that the Japanese Government had ceased to deal with the National Government of China and would establish and promote the growth of a new régime in which they could have confidence. As a result of this statement, the Chinese Government now expected a further intensification of the hostilities. The Chinese Government were not. I gathered, surprised at this outcome; indeed, I understood that they had never expected more than the possibility of an armistice, during which they would have asked for the participation of His Majesty's Government and the United States Government in any peace negotia- tions which might take place.

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5. Speaking of the future prospects of the war, the Ambassador explained that, while the Chinese Government were prepared to continue the struggle. they Indeed, it knew quite well that they could not do this indefinitely unaided. would be very difficult for them to do so for longer than a few more months. It was for this reason that material help from abroad was essential and that they had now secured more active Russian participation by the supply of arms and technical assistance. But more help was urgently required. He was convinced that the Soviet Government were anxious to receive some indication from our- selves and from the United States Government that we did not disapprove of the course which they were now taking of sending arms to help China. Ambassador believed that the Soviet Government generally feared that they would be frowned upon by ourselves and the United States Government if they were playing too prominent a rôle in the Sino-Japanese conflict. I replied that I was not quite clear what it was that the Soviet Government wished for. If it was an expression of solidarity with them in the sense that we would share with them the consequences of any additional help that they might give to China, the Ambas- sador would know as well as I what were the prospects of the United States Government joining in giving such an undertaking The Ambassador said that he knew that in the past the Soviet Government had hoped that some such arrangement as this might be made--that is, that we should share the risks of giving help to China, and Russia was willing to take her share. But the present position was not quite the same. Having failed to secure this assurance, the Soviet Government were fearful lest there should be an unfavourable reaction here and in the United States if they sent more arms to China.

6. The Ambassador went on to speak of the German attitude. He said that from information obtained from the Chinese Ambassador in Berlin, he had no doubt that the German Government were extremely anxious at the development of events in the Far East, They saw their Chinese market, which was of great importance to them, being steadily destroyed, and they saw their ally in the Anti-Comintern Pact being weakened in a military sense. The Ambassador thought that, as the war progressed, the German attitude would become less and less favourable to Japan. Indeed, it had been remarked that at the recent reception of the Japanese Ambassador in Berlin, when the latter had spoken with great enthusiasm of the relations of the two countries, the German Chancellor had been almost casual in his reply, and the German press had not given prominence to the reception. (I am not clear whether this conversation took place when a new Japanese Ambassador presented his credentials or whether in the course of the New Year reception; I think the former.)

7. The Ambassador went on to say that if we and the United States Govern- ment could not give more help in arms, then he hoped we should be able to give some assistance to enable China to maintain her currency. He repeated that if her currency were to collapse the consequences might be disastrous. The Ambas- sador himself was no expert in these matters, but he hoped that Mr. T. L. Sung might shortly be visiting Washington and London to put the Chinese point of

view.

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8. Finally, the Ambassador mentioned the new road which the Chinese were building to the Burmese frontier. They hoped that that road would be finished in March, and the place on the Burmese frontier towards which they were working was Jui-li (? Muse).(") The Ambassador had been asked to say that his Government were a little apprehensive that the road in Burma which would join this a road which I understood passed through Bhamo and Lashio-might not. be strong enough to stand heavy traffic in wet weather. The Chinese Government would therefore be very grateful if the road could be strengthened against its completion from the Chinese side

I am, &c.

ANTHONY EDEN.

(1) Ju-li is the name of a district in Yunnan comprising the Mengmas and Lasa States.

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