TNAG-2016-FCO40-2871-Relations-between-Hong-Kong-and-Japan-1990 — Page 81

CODE 18-77

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Reference.

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From: M E Cowin

Far East Section Research & Analysis Dept OAB 2/126 210 6217

Date: 5 October 1990

Mr Cummins FED

JAPAN: HONG KONG REPARATION ASSOCIATION

1. We spoke. I am afraid that my research has not yet revealed a definite answer to your questions. I have found some discussion of the problem of occupation money but no indication yet of any agreements reached on its redemption or compensation for people

holding it.

2.

It has not been easy to track down clear statements of how the question of Japanese wartime currency was dealt with. There is a further confusion that at least three different types of currency have cropped up:a) local denomination currency issued under the Japanese occupation, b) military occupation currency denominated in Japanese yen, and c) normal Japanese Imperial yen. It is not always clear which category is being discussed but the Hong Kong Reparation Association seem to have the latter two.

3. I have yet to examine closely the files dealing with reparations at the 1951 Peace Treaty, or those dealing with reparation regulations which are referred to in Articles 14-21 of the Treaty. You may, however, be interested in my preliminary

conclusions.

Summary

into

4. The evidence so far points to an unwillingness by the Allies to convert, use or compensate for currencies issued in Japanese occuppied territories. In the cases of Burma and Malaya the Allies decided not to recognise the currency issued by the Japanese (see para. 5 below) on the grounds that it represented "spoliation" by the Japanese. In 1946 the Far East Commission decided not to convert any Imperial yen held outside Japan the new Japanese currency that was being issued at the time (see para. 11 below). The view of the Allied authorities in Japan at the time appeared to be that questions of currency holdings should be deferred and dealt with as part of the settlement of reparation claims (see para. 11 below). In 1949, a Foreign Office answer to the Treasury indicated that in Malaya military notes were valueless although normal Imperial notes were worth holding onto for some time (presumably with the hope of including them in reparations). In the San Francisco Peace Treaty, which covered reparations, there was no mention of the currency question and all

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