The New York herald., 1921-12-18
DEADLOCK CONTINUES
ON SHANTUNG ISSUE
Japan Insists on Long Time
Payments by Chinese
.or Railway.
PEKIN OFFERS CASH
Toxic Presses New Loan
and Is Suggesting Am
pie Security.
DELAY is EMBARRASSING
Far East Committee Seeks
Disposal Of Problem Of
'21 Demands
DELAY rs EMBARRASSING
Special Dispatch to THE New YoRK HERALD.
Naw York Herald Ruraap

Spcctol Dispatch to THE New York HnnLp
New York Herald Bureau,
Washington, ID. c., Dec. IL. !
Japan and China have deadlocked
again over the settlement of the
Shantung controversy.
The latest obstacle Is the manner in
which the Chinese Government is to
pay for the Japanese interest in the
Shantung road.
The controversy presents direct is
Sues China desires to pay cash for
the road on the basis of a price of
P3,00o,000 gold marks. The cash pro-
posal is modified by the suggestion
that 1t be paid within three years.
Japan proposes that the payments
be extended over period of twenty
years, virtually constituting new
loan by Japan to China, which would
be forced upon China and thereby con-
tinuing her interest in the Shantung
railroad and in the province itself.
Japan Offers New Loan.
In addition to this, the Japanese are
suggesting that China accept new loan
to tide her over her present difficulties,
and that ample security be given her for
the unsecured loans made during the
Anfu period, which, with other obliga-
tions incurred by China to Japan, ap-
proximate $50. 100000
The representatives of the two Gov
ernments in their conversations to-day
Exchanged views" on this question, the
only hopeful sign in the situation being
that the Japanese agreed to reconsider
their proposition. This reconsideration,
the Chinese believe, will amount to a
Variation of the same offer.
The result is tone of pessimism rela-
tive to the Shantung controversy, which
is not Frightened by the fact that both
delegations realize they are approaching
the real difficulty Of their situation in
Manchuria. To-day represented the sew
enteenth session in the series of Sino-
Japanese conversations.
In the meantime the Far Eastern COM
mittee is still adjourned pending some
method of disposing of the problem pre-
sented by the Chinese delegates. who
have thrust the agreements growing out
of Japan's ''Twenty-one demands" upon
China into the conference.
There are evidences that the delay in
settling the Shantung conference is
bound up with this move made by China
which is proving extremely embarrass-
ing to every one in the conference eX-
cept the Chinese.
Japan has gone on record as saying
she will not consent to discussion OF
these agreements by conference, al
though her delegates have intimated
they would be willing to explain why
Japan feels she cannot have them dis
cussed
The LiaotunG Concessions.
This unwillingness to have the Chino
Japanese agreements discussed bark
back to the Manchurian question be-
cause it was through this convention
that Japan procured her ninety-nine
year extension of her leaseholds in the
Liaotung Peninsula. She has already
stated she is unwilling to give up her
leaseholds in Dairen and Port Arthur.
Ths Chinese delegates are becoming
extremely restive under the situation
and are preparing to make frank
statements which call direct attention
to what they regard as a position by
Japan which is out of harmony with
the Japanese declaration of acceptance
I'm principle of the territorial integrity
of China. Such a course will present a
difficult problem both to japan and the
rest of the Powers.
Japanese diplomacy is veering around
TO position where IL can break down
The feeling OF hostility among the Chi
nese people so that her industrialists
may sell more goods i'm that country,
while the Powers are embarrassed by
their desire to maintain good relations
with Japan and at the same time reha-
bilitate China.
The time has passed when there Is any
likelihood of the Chinese delegates with
drawing from the conference. They
viii go through to the finish. regardless
OF whether they obtain as many things
as they desire or not.
But this can be said upon excellent
authority. that the Chinese will refuse to
agree TO any convention or agreements
which leave tho agreement growing out
of the twenty-onG demands in force, or
any agreement which leaves Japan in
control, economically or politically, OF
either Shantung or of the Liaotung
Peninsula.
They will file thei. exceptions to these
points IL they are overruled. leaving the
question unsettled and as threatening as
before.