493.11/939: Telegram
The Minister in China (Schurman) to the Secretary of State
[Received 2:15 p.m.]
290. At a meeting of the representatives of the eight protocol powers held on December 6 it was decided at the suggestion of the French Minister to send an identic telegram to our respective Governments which in translation reads as follows:
“The representatives of the powers signatory to the 1901 protocol record the fact that the Chinese Government have not replied to their communications regarding the payment in gold of the Boxer indemnity; that the Belgian, French, Italian and Spanish installments not having been paid in full for a whole year, the service of this indemnity has not been fully met in 1923 and that in strict law no surplus of the Chinese customs revenue should be declared and paid over to the Chinese Government at the end of this year. However, in practice the customs revenues are paid into the banks designated by the agreement of 30th January, 1912,16 (namely, the Hongkong and Shanghai Banking Corporation and Russo-Asiatic Bank) to the account of the inspector general of customs who is authorized to draw on this account over his own signature. We request the authority of our Governments to instruct the banks by virtue of the aforesaid agreement to withhold payments from this account until suitable arrangements have been agreed upon and to notify this decision to the inspector general of customs. If this decision meets with your approval it must be given effect to before 31st of this month.”
It is distinctly understood that nothing in the foregoing is meant to imply that countries such as the United States which are now receiving regular payments in respect to their share of the Boxer indemnity shall cease to receive them.
[Paraphrase.] I must say that I consider the plan of doubtful wisdom although I did not feel that I would be justified in refusing to submit the above message for your consideration. The inspector general of customs is aware that something of this kind is being considered but he has not been told of the plan. He has intimated to my British colleague that if his drafts are not honored by the Hongkong and Shanghai Bank he will sue the bank in the British Supreme Court for China. I cannot foresee what the court’s decision would be, but I know that my British colleague thinks that it is very likely that the inspector general would win his case. Such a verdict would put us in a rather awkward position. Another consideration is that in case the judgment were against the inspector general it would lead to a default in the Chinese internal loans which [Page 597] at present have the customs revenues for security. Such a result would give rise to a wave of antiforeign sentiment which would sweep over China. I consider the views of my French colleague to be sound and logical, but from the standpoint of expediency I question the wisdom of putting them in effect. Another result might be that the Chinese Government would denounce the 1912 agreement, reverting to the position before that date. I am informed in strict confidence by my British colleague that he is cabling his Government substantially the same. Please cable instructions. [End paraphrase.]
- Not found in Department files.↩