893.6363/9–649: Telegram
The Consul at Tsingtao (Hawthorne) to the Secretary of State
[Received September 6—6:12 a. m.]
476. Re mytel 471, September 2.8 Norwegian acting manager Standard Oil Company has transferred firm’s interests to committee Chinese employees and will depart when possible. Believed Asiatic Petroleum Company, British, would also withdraw foreign staff except for current controversy with labor union re payment provident fund former Chinese employees.
British manager Hong Kong [and] Shanghai Bank, only foreign bank here, has informed principals his intention withdraw even if this should involve closing bank and/or his dismissal after over 25 years’ service.
BAT9 cigarette factory employing 6 Americans, 3 of them departing on premature home leave when possible, suffering heavy financial losses and will doubtless be forced close when 3 months’ stocks exhausted if not before. Communists obviously plan monopolize cigarette industry, to create which expected sell tax free cigarettes while inspiring labor trouble in BAT plant.
Well-informed Chinese businessman convinced Communist policy is to freeze out all foreign interests through excessive taxation. Even Soviets becoming increasingly unhappy and many have left or are endeavoring leave for Manchuria. Average Chinese has also been disillusioned but expected remain apathetic.
Department pass Nanking its discretion.