408 ° FOREIGN RELATIONS, 1934, VOLUME III

Mr. Hagiwara stated that the China Development Finance Corpo-
ration had a League of Nations background which did not enhance it
in Japanese eyes. Describing this, he explained that the League of
Nations had contemplated three or four years ago the creation of a
subsidiary organ which was to have as its primary interest the direct-
ing of financing of projects in China. This plan was abandoned before
realization. However, when Mr. T. V. Soong, as Minister of Finance,
visited the United States and Europe in 1933 he discussed with West-
ern financiers the desirability of organizing a committee of leading
foreign financiers, exclusive of Japanese, to plan and undertake for-
eign investments in China and to act at the same time in an advisory
capacity to the Chinese Government. In both these plans, Mr. Hagi-
wara stated, League personages figured prominently. In the first
instance, naturally, the members of the League’s subsidiary organ
would have been League personnel, while the second project had been
recommended to Mr. Soong by Mr. Jean Monnet, formerly connected
with the League of Nations. The third and accomplished project, the
China Development Finance Corporation, is the result primarily of
the efforts of Mr. Monnet, formerly of the League, and is an outgrowth
of the first two plans, and therefore has a League complexion although
it has no actual connection with the League. (Mr. Hagiwara said that
details had been given to Ambassador Matsudaira *” by Mr. Thomas
Lamont.)

Mr. Hagiwara went on to say that the Japanese were not inclined
to view the new organization favorably because of another factor,
namely that it has a political character as a result of inclusion in its
membership of such men as Dr. H. H. Kung, the Minister of Finance,
and Mr. T. V. Soong, executive member of the National Economic
Council. Were it a purely non-political organization, it would be con-
siderably more acceptable to the Japanese. Mr. Hagiwara concluded
his remarks with the statement that the Japanese did not believe that
the new organization would accomplish much of anything.

Respectfully yours, Nertson TRUSLER JOHNSON

 

898.504/104
The Consul at Geneva (Gilbert) to the Secretary of State

No. 993 Political Geneva, September 1, 1934.
[Received September 11.]

Sir: I have the honor to refer to my despatch No. 958 Political
dated July 18, 1934 in which I discussed the League project for tech-
nical assistance to China as the matter stood at that time, with special

* Tsuneo Matsudaira, Japanese Ambassador in Great Britain.