CO129-571-16 New Territories 13-4-1938 - 12-12-1938 — Page 90

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"amendment)

making a bad bargain from a financial point of view, and

that the proposed loan might not be sufficient to maintain

the Chinese currency for more than a comparatively short

period.

Mr. Cowell pointed out that the latter

considerations did not arise in the present case, and he

asked whether there had been any recent changes in the

Cabinet policy. In this connection he referred to the

recent Foreign Office letter regarding the policy of

"pin pricking" the Japanese throughout the Empire. Mr.

Howard also mentioned the recent telegrams from H.M.

Ambassador at Tokyo which showed that he was now more

inclined to advise taking a firmer line with the

Japanese owing to the lack of success of a conciliatory

policy. Sir John Brenan replied that, as far as he was

aware, this question had not come before the Cabinet

recently.

The recent Foreign Office letter to which [arette as the result by any mestructions by (written

Mr. Cowell referred had not been submitted to the Cabinet.

Mr. Wardley suggested that the present proposal

should be discussed as a commercial proposition. He said

that, as such, he doubted whether it was worth our while

to pay any sum which will be likely to interest the

Chinese Government. Sir John Brenan asked whether it

might not be worth our while to pay such a sum as a means

of giving assistance to China against Japan. Mr. Compton

replied that he thought that in such a matter we were

bound by the recent Cabinet decision.

In reply to a question by Mr. Wardley, Mr.

Cowell replied that the Colonial Office did not wish to

put forward any proposals in this matter, they merely

6=

wanted

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