CO129-567-5 Traffic of arms to China and Japanese air-raids on Kowloon-Canton railway 11-4-1938 - 19-1-1939 — Page 65

[This Document is the Property of His Britannic Majesty's Government, and should be

returned to the Foreign Office if not required for official use.]

65

(F 11844/6941/10)

To CHINA.

Cypher telegram to Mr. Allen, (Shanghai).

Foreign Office,

No. 971.

10th November, 1938,

10.30 p.m.

0:0:0:0

Sir A. Clark Kerr's telegram No. 4 Tour Series A and Burma Office telegram No. 241 to Rangoon [of the 23rd and 27th October;

import of arms through Burma into China.]

As regards Chinese request for concessions in respect

of safety provisions and railway freights, please reply in sense

of Rangoon telegram No. 257 C [of the 4th November].

As regards exemption from customs duties for military supplies,

please inform the Government to which you are accredited that Govern- ment of Burma, while regretting inability to grant total exemption, are prepared to extend the drawback system to all goods imported

into Burma and re-experted to Yunnan via Lashio and the new through road, and to accord sympathetic consideration to a Chinese request

15 for increase in drawback on such goods up to 16ths of the duty levied

on import, on the understanding that the Chinese Government are

prepared, in the same helpful spirit as underlies the present

extensive concessions by the Government of Burma, to enter in due

course into negotiations for an agreement on wider lines regarding

Burma-Yunnan trade, and that the question of customs drawback would

be brought into consideration as part of such negotiations. You

may add that the Government of Burma are giving further consideration

to possibility of fixing a higher rate of drawback for special

categories of munitions provided that the consignments are shown to

be to the order of the Chinese Government.

2. The Chinese Ambassador in London is being informed of these instructions.

Repeated to Mission Chungking No. 93 and Rangoon.