893.51/7468
Memorandum of Conversation, by the Acting Secretary of State
The Foreign Minister of China, Dr. T. V. Soong, called to see me this morning at my request.
I told Dr. Soong that after the conversation of the President with the Secretary of the Treasury I had asked him to be kind enough to come to see me in order that I might talk over with him certain problems which would arise in the event that the purport of Article 2 of the agreement which had been drafted for signature by him and by Secretary Morgenthau covering financial assistance by the United States to China in the sum of 500 millions of dollars were omitted.
I said that of course the action of the Congress and the Executive of the United States in granting financial aid to China to the extent of half a billion dollars indicated our full confidence in the Chinese Government and the extent of the desire of the United States to assist [Page 489] China in our common war effort. I said that, however, sooner or later there would be an insistent demand in the United States on the part of our own people for information as to how this assistance rendered by us had in reality aided the Chinese Government and people in the common war effort and that if there were no provision included in the record of the agreement and of the negotiation which led up to it under which the Chinese Government was to furnish this Government with full information as to the manner in which these funds had been expended, a situation would inevitably arise which would be detrimental to the best interests of both countries and to the relations between them.
I said that I fully understood, in view of the Generalissimo’s message to the President, that the Chinese Government interpreted this assistance as being “without any conditions attached”. I was therefore not suggesting any reconsideration of this aspect of the matter, but I wondered if Dr. Soong would not agree for the reasons I had mentioned that a unilateral statement on the part of the Chinese Government to this Government that in view of this cooperation which so happily existed between our two countries, it intended to inform the Secretary of the Treasury of the United States fully from time to time of the disposition which had been made of these funds would not be a desirable solution.
Dr. Soong immediately stated that he would be very glad indeed to have this done and that if I agreed, he would immediately address in the name of his Government a letter in that sense to the Secretary of the Treasury.
I expressed my appreciation of his friendly and cooperative attitude and said I thought this would indeed be exactly the procedure which would settle the matter satisfactorily. I said that if this step were now taken, I felt sure that the agreement could immediately be concluded.