FO371-24687 — Page 185

Page 185

102

Page 185

Registry F 5692/176/10

TELEGRAM FROM Sir A. Clark Kerr

(Chungking). No. 287 (de cypher)

F

Chinese currency:

F 5692 111

شما

1940

His Majesty's Government's proposals.

Refers to Foreign Office telegram to Shanghai No. 1272 (F 5205/57/10).

Discusses His Majesty's Government's proposals for rendering financial assistance to China, states that he has only just realised the full scope of these proposals, which will have the effect of giving with one hand and taking away with the other. Maintains that the effects of Chinese awakening to this fact would be most unfortunate, and urges that it would be in Registry 22 Dec.,1940. wise to give more consideration to the political aspect

of this question than to its purely technical aspect. (Repeated Shanghai 31, Tokyo 107, Hong Kong 138 all saving and Washington 27).

Dated 20 Dec., 1940. Received

}22

F: China.

Last Paper.

F5688

References.

{Print.)

(How disposed of.)

7.8.571 Donaldson (w.1.0.)

Dec 23

8) Try. (M. Young)

Dec 23

3

(Action completed.)

get (Index.)

30

(Minutes.)

Spi

copied to Mr. N.

6. 17. N. Yousing (5). Sis J. Brefan. J. Acbblethwait),

23/1

As I understand it, the question at issue is whether or not we should allow China to obtain a quota of U.S. dollars out of our sterling loans. arguments advanced by Mr. Rogers are highly technical and we must await the Treasury's views.

The

I would only suggest, however, that we should be firm in disabusing the Chinese of the idea that they are to get everything and give nothing. We must continue to impress on them that we also are engaged in a desperate struggle and have to think of our own position. Mr. Rogers is inclined to exaggerate the effect of financial factors in the situation, and I should think that when Mr. T.V. Soong and our own financial pundits get together on the subject they will be able to work out some reasonably satisfactory compromise: We need not pay too much attention to talk of Chinese resentment, or of their "eternal gratitude"; both are very short-lived.

Next Paper.

F5705.

20814

¥.5.P.

124th December, 1940.

Ashley Clarke

24/12

The

Page 185

Page 185

Page 185Page 186