Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1919-08-30
OPPOSES ECONOMIC
LOAN TO CHINESE
Japanese Banker Declares Pekin
Has Failed So Far to Ap-
prove Consortium
INFLUX OF MONEY FEARED

Washington. Aug. 30.-An explana =
tion Of japanese insistence upon the ex e
ciusion Of Manchuria and Mongolia
from the new consortium is contained
in a statement by Yuko Hamaguchl,
president OF a prominent bank and in e
fuential member of the Kenseikai, n
translation of which was received here
yesterday.
He also states the Japanese aspira
tions in regard to the development of
China. and draws attention to the fact
that the Chinese Government yet has
not approved of the consortium.
Mr.. Hamaguchi quotes statement
issued by the Kenseikai, to the effect
that economic" loans should be ex-
cluded from the scope Of the consor-
tium; that Manchuria, Mongolia and
Shantung should be excluded also that
existing loans should be recognized If
desired, and that the economic" loans
Of the new group should be restricted
10 large enterprises, such as railways,
canals, reclamation. etc.
Purposes or Loan Group
The loan group has been organized
he says, to give financial aid to China
for both political and economic pur-
poses. he continues:
''As political loans have been le-
gally prescribed, no room is left for
discussion, but in regard to partiCi
patton in the economic loans. our party.
having carefully investigated, has
come to the conclusion that, on the
whole, it must bs opposed.
considered from the Chinese stand
point, there is theory prevailing
which insists that the new consortium
will overthrow the spheres of influence
and will contribute through the influx
OF capital to the development of China.
Yes, but one must see that there il
danger attached to this--danger that
the great influence of the powers joined
in the loans naturally will restrain the
freedom of China, with the result that
she will be put under joint supervision
and iucessant interference by the asso-
ciated powers.
"This not only will threaten the in e
dependence of China. but will mean
death to her. II the free loan system
had been adopted among the powers
whenever China was in need of loans,
she could have made a contract with
any of them on profitable conditions. In
the case Of joint loans every nation loses
its freedom OF competition and China
will be forced to accept any offer of the
loan group whether it is disadvanta
eeous or not.
View Accredited to Japan
Viewed from the japanese stand :
point, the supporters of the joint loans
insist that country like ours. which
lacks funds and has a comparatively
high rate of interest, cannot compete
with a country like America. which has
enormous wealth and low rate of in :
terest; therefore it is the wisest way
Tor Japan to co operate with other ma :
tions in financing China.
My view is quite different. Though
America is rich and has a low rate
OF interest. yet Japan is intimately re
lated to China in language. customs
ETC., TO say nothing of their geograph
acal and historical relations.
Moreover. the thorough and pru.
dent Investigations by japanese bust
ness men in China cannot be equaled
This advantage to Japan. in the cas-
or free loans, more than can cover tn,
lack yof funds and the low rate of in
terest mentioned above. Moreover. w,
must be able in the case of free loans t.
cooperate with American capitalists il
our enterprises in China.
cannot accept the view that it i
advisable to participate in the join
loans at the cost of our comparativel,
small rights of priority already acquire,
in China and the acknowledgment of tn
greater rights of precedents like thos
Of England.
Rights Gradually Acquired
'The rights of England are grad
ual acquisition, a result of her effort
in past years. But il was only afte
the Chino japanese war that Japa
began to pay attention to China. an
up to the beginning of the European wa
she always was suffering from lack q
funds and could not afford foreign in
vesfment.
Now that she has become somewha
opulent. it is time for her to play a
active part in financing China. Eng
land, owing to the war. now is in a
exhausted condition. She lacks fund
and, is hardly able to exercise he
rights of priority in China.
Japan must seize this opportunity
Her position toward China is not tha
Of a creditor only. Her relations wit
China differ from those of other pow
ers. Therefore. her motives in financin
China also mustNbe different from thos
Of other nations. The other powers ma
aim at profits; Japan must not be con
tented with profits only; she must. frs
Of all. have the noble purpose in vie
OF promoting the common interests
China and herself for the sake OF peac
In the Far East