The Birmingham age-herald., 1919-05-21
EXTENSION OF
 CREDIT TO CHINA
Fly HOLLAND.

have all of the details been made known
 of the financial arrangement which is to make the United States and three Euro pean nations, creditors to China by large amount. Only the bare fact has been announced that an agreement has been reached by means of which, when working of it begins China will receive many millions, perhaps much as s1oO- 000.0oO in all. through an international syndicate of which the United States is to be perhaps the most important member
 It is inevitable that the minds of men of finance and especially of the leading executives of the American banks which are expected to participate in this loan should recall like attempt which was made in the latter part of the administra- ton of President Taft.
 For word having reached the Secre- tary of State, MT. Knox, that China was seeking loan of as much as $15O ,0O0 II so much as that could be obtained the lsecretary determined that, if possible the United States should participate in this loan. Five of the leading European ma
 tions were at first in agreement to lend China the money which was greatly de- sired in order to begin and carry on in- teinal improvements and complete certain railroad plans. Secretary Knox was fear
 tul lest, in the negotiations, one or more of the European nations would be able to
 secure concessions from China, perhaps
 for exclusive trade facilities, possibly for
 the lease Of territory. The policy adopted
 by the United States when John Hay was l Secretary of State, which was that of
 the open door, might be impaired or end ed in case China found it necessary to
 make certain concessions in order to se- (cure the loan. That was something which he believed the American government should prevent. He therefore communi- eated with Henry F. Davison, now chair
 man of the Red Cross organization, and
 within few hours after Mr. Davison received the dispatch he was in confer ence with the secretary at the state de-
 partment. MT. Davison was asked by Secretary Knox if he could organize an
 American syndicate which would pledge itself to take it's proportionate part of the proposed Chinese loan. Within a day
 or two after the secretary asked Mr.
 Davison to do this the syndicate was or ganized and then after a little pressure the United States was admitted into this international syndicate so that it became l known ''the six nations syndicate"
 When the representatives of the six na tions met at Paris. MT. Davison was chosen chairman of the commission.
 He spoke briefly on taking the chair
 saying no more than this: That nothing should be done by the commission which would result in loss of Chinese territory or in ending the open door policy. He observed that some of the representatives seemed a little annoyed presumably be- cause they entertained the hope that the nations which they represented could ob- tain concessions from China. But MT. Davison's blunt statement and his in sistance that it be accepted were suf- ficient to secure for the commission unan- imous approval accompanied by formal pledge, of his statement
 l WHAT CHINA WANTED TO DO | The Chinese government was prepared to spend millions if the money could be found in the development of her very rich lnatural resources, in the institution of new industries and in the construction Of railroads. If a programme of this kind lcould be put into effect, then there would follow a heavy demand from China for manufactured products. Each one of the nations would try to meet it's fair share of this demand and the United States representatives were certain that this lcountry would gain a good part of the trade which in that way would be opened The abler men of China were satisfied tl.at with internal improvements well de-
 veloped and with adequate transportation secured China would awake from her long sleep and make progress which might i'll time be compared with that which Japan has made.
 ! When the administration of President iWilson began speedily, the Secretary of State Colonel Bryan. intimated to MT
 Davison that the government of the
 United States should not be called upon to give it's moral support to any propo'
 sition similar to that of the Chinese loan
 This decision of course compelled the
 American syndicate to withdraw, and II
 was the fear of our leaders that as re suit of this withdrawal and the non participation of the United States in the
 C.1. loo, r,,iev 1nf4 1r,co of trade, as well as an honorable in" lGuence, which otherwise would have been secured had the United States remained one of the six nations creditors of China
 THEN CAME THE WAR
 The advent of the European war affect. ed China, as it has affected every other nation. But withsthe certainty of the tri lumph of the allies over Germany, China iaeain began negotiations, in the hope that in this way she could secure millions
 which are needed if she is to entev upon a new era of industrial. mineral and transportation development.
 It is an interesting coincidence that
 whereas Henry P. Davison of J. P. Mor- gan & Co was the chairman of the body of representatives of the six nations. now lThomas w. Lamont, also of J. P. Morgan & Co. has been chosen chairman of the lnew commission or international syndi- lcate Our allies as well as China are very lglad that the United States is to partic- Iipate in this loan. In fact. were the United States unwilling to share in 1t lthe proposition would undoubtedly fall through. for only not is the United States to pay over it's own share of the loan but it undoubtedly will be called upon by Great Britain and France to lend those nations the money with which they can also be prepared to enter into participa- stion in the loan. Those best informed say