File No. 893.51/898d.
The Secretary of State to the American Ambassador to France.
Washington, May 18, 1912.
You will communicate the following memorandum textually to the Foreign Office, and repeat to London and Berlin:
In view of what it is hoped is only a temporary withdrawal of the Japanese and Russian bankers the following is communicated to the Governments of Great Britain, France and Germany:
From the first the Government of the United States has favored the principle of broad internationalization of loans to China, and would consequently favor the admission of Austria and Italy, thus enlarging the group to eight (assuming the continued participation of Russia and Japan) presumably on a basis of a smaller share of investment, to be determined by the bankers now negotiating. This would enlarge the six-power group (as including Russia and Japan) to include all the first-class powers signatory to the Boxer protocols.
As for the other powers commercially or financially interested in China, the Government of the United States also inclines to the belief that it might strengthen the situation to favor participation by the bankers of such powers if they were granted subsidiary participation in the shares allotted to the principal groups.
The Government of the United States would, if the issue became hopeless, deprecate insistance upon exclusive fiscal agency; and if something more were desired by the bankers in addition to the other broad conditions for control, protection of loans and security, the United States would desire to raise the question whether it might not be feasible to avoid the monopolistic feature and the possible semblance of too great foreign authority involved, by the substitution of a provision to the effect that the Chinese Government would engage with the respective Governments not to negotiate any large loan except with the combined banking groups and their associates, or with corresponding groups of the same nationalities, and upon the same broad principles of internationalization.