Memorandum by the Secretary of State Regarding a Conversation With the Japanese Ambassador to Great Britain (Yoshida)

[WASHINGTON,] June 12, 1936.

Mr. Yoshida, Japanese Ambassador to England, came in and stated that he was very desirous of promoting better relations and better understanding between our two countries. He said that the one big fact which he wanted the American people to recognize was the immense and rapidly growing population of Japan and the absolute necessity for more territory for their existence in anything like a satisfactory way. He referred to the fact that there was misunderstanding and misapprehension on the part of our people in this respect as it related to Japanese movements in and about China; that this also was probably true as to the British; that the Japanese armaments were not intended for war against any particular country, especially us, but that Japanese naval officials were always undertaking to create additional vacancies and additional room for promotion, etc., etc. I did not tell him that this by itself was not entirely appealing. He expressed an earnest desire for conference, collaboration and, without alliances, such relationships as would work out any questions arising in an amicable and fairly satisfactory way. He expressed his purpose to have a number of conversations with Ambassador Gingham, as well as with the British officials, on these subjects, with the view to the former conversations getting back to me.

In reply, I told Mr. Yoshida that I would speak frankly but in the friendliest possible spirit and say that the impression among many persons in this country was that Japan sought absolute economic domination, first of eastern Asia, and then, of other portions as she might see fit; that this would mean political as well as military domination in the end; that the upshot of the entire movement would be to exclude countries like the United States from trading with all of those portions of China thus brought under the domination or controlling influence so-called of Japan; that this presented a serious question to first-class


countries with commercial interests in every part of the world, reason that, for instance, my country stood unqualifiedly for the principle of equality of commercial opportunity and industrial right alike in every part of the world; and that it would be strange and impracticable for my country to stand for this doctrine with the announcement always that it qualified same by applying it to only one-half of the world and one-half of the world's population. I remarked that I could say in all candor that this Government had never by the slightest word or intimation suggested to the people or officials of the 20 Latin American countries as to what amount of trade they should conduct with Germany, or Great Britain, or Japan, or any other country.

I continued with the statement that there was no reason, in my judgment, why countries like Japan, the United States and England, could not in the most amicable spirit, and with perfect justice and fairness to each, agree to assert and abide by the worldwide principle of equality in all commercial and industrial affairs, and each country solemnly agree that it would not resort to force in connection with the operation of this rule of equality, and why Governments like the three mentioned could not sit down together and in a spirit of fair dealing and fair play confer and collaborate and not cease until they had found a way for amicable and reasonable adjustments or settlements. I said that this would wipe out and eliminate 90% of all the occasions for friction between the nations. I then repeated what I told him I had stated to Ambassador Saito, which was that neither Japan, the United States, England, nor any other country, would be able for a generation to supply the needed capital of many billions of dollars for the reasonable internal improvements and development of purchasing power in China and similar Asiatic localities; that their purchasing power was down to next to nothing at present; that there was ample room for long years to come for three or four countries like those just mentioned to supply all the capital they would have available, with the result that increased purchasing power would afford markets for most all of what all of the countries combined would have for sale in that part of the world, and that in any event any questions or problems arising in this connection could and should be solved in the same amicable and fair spirit to which I had already referred. I assured the Ambassador more than once of my high opinion and personal regard for his people, and especially his statesmen, and that I was anxious to see all parts of the world develop and go forward with every kind of progress to the fullest extent. He expressed his interest in the views I offered and indicated a disposition to collaborate.


I then carefully and rather fully defined and described the machinery, the policy and the scope, of our present reciprocal trade agreements program, which, I said, related to real international trade recovery to near normal and the restoration of conditions of peace. I added that for more than two years this Government had unselfishly, and at the sacrifice of bilateral trading, been making an earnest fight thus to induce other countries to lower their excessive barriers and permit some 20 billions of dollars of international trade by degrees to be restored. I stated that if and as such increased trade was realized, Japan would receive her substantial share without any effort or contribution on her part, as would other trading countries, and that this would be far more valuable than the limited amount of trade to be secured by purely bilateral bartering and bargaining, such at nations are practicing today, at the expense of triangular and multilateral trade; that we in this country had at the risk of our political situation been carrying forward this broad program; that on account of the opposition sentiment here, it was exceedingly hurtful to the progress of our movement when, at a critical stage as at present, a country like Japan sent in abnormal quantities of highly competitive products to the extent of 20 or 40 or 50% of our domestic production; that this would present a different question in other and ordinary circumstances, but that at this critical stage, as in the recent case of certain cotton textiles and other commodities sent in by Japanese businessmen in unusual quantities, such practice was seriously undermining and jeopardizing the success of our entire program. I stated that I did not desire to be misunderstood; that it was this outside interference at a time when it was extremely dangerous and harmful to the success of the movement on account of the large opposition sentiment in this country; that I felt a trading country like Japan, which would share to the extent of billions of dollars in the world trade which it was proposed to restore by our pending reciprocity program, could well afford to make a slight contribution to the movement by cautioning its nationals to refrain at the psychological moment from seriously embarrassing and handicapping us here by sending in abnormal quantities of competitive products compared with the amount of our domestic production.

I said I could make this plainer by suggesting that if the Argentine were carrying forward our reciprocity program under great difficulties, and just at the critical stage my country should export unusual quantities of beef, wheat, wool and corn in to the Argentine, which, like my own country, produces each of these commodities for export, unquestionably this would seriously endanger the success of such


Argentine trade agreements program. I said that this illustration fitted exactly the present situation between Japan and this country.

The Ambassador stated that he would like for me to remember the difficulties of the businessmen and traders of Japan and the necessity for outside trade.

I assured him that I was keeping this phase specially in mind and then added that if our movement to restore some 20 billions of dollars of world trade should break down tomorrow, as a result of any material number of excessive Japanese imports and their effect on public opinion, Japan instead of getting between 1 and 2 billions of this increased trade then would be confined permanently in the future to such small increases of trade as she might be able to secure by desperate bilateral bargaining and bartering in a world trade situation steadily becoming less in quantity and value. I said that this stated exactly the two courses open and that I would greatly appreciate it if his Government could see more fully these broader phases.

Mr. Yoshida finally ceased to make any comment about the urgent needs of Japanese businessmen, but said that he now understood more fully the viewpoint I had expressed.



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