CO129-571-16 New Territories 13-4-1938 - 12-12-1938 — Page 98

bargain from a financial point of view, and that the

megat proposed loan

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.

Howard also mentioned the recent telegram

from H.M.

Mr.

advise taking go which showed that he was now more inclined to take a firmeline 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

The recent

had not come before the Cabinet recently.

Foreign Office letter to which 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

wanted