Tokyo, Jan. 17.
INCREASING friction between Japan and the Democratic Powers was predicted in informed quarters here today as a result of indications that Japan will assume the offensive diplomatically in her reply to recent British and American notes protesting against Japan's policies in China.
Japanese quarters predicted today that Japan's reply to the two notes—and to France, if Paris submits similar protests—will be that Japan is willing to grant the same privileges in the Far East that are granted to Japanese in other parts of the world.
'The Japanese reply, it was reported, will define the basis of Japan's foreign policy; namely, the willingness to ce-operate with other nations in establishing' complete freedom of trade, unrestricted access to raw materials by all Powers, and the abolition of racial discrimination.
Japanese reports said this basic foreign policy" would require that foreign legislation such as America's Oriental "Exclusion laws should be abolished, that preferential tariffs and quotas be discontinued and that economic blocs such as the British Empire and the Pan-American system be dissolved.
The complete unacceptabitity of} such a programme to. the United. States and Britain, foreign observers point out, inevitably must lead to a Aiplomatie break with Japan if she persists in offering such a policy in reply to protests against Japan's, Invasion of China and continued disregard for foreign rights and interests Japanese reports said Japan would accept the Anglo-American offer for multi-lateral conference to consi der possible revision of the Nine Power Treaty only if Britain and the United States would accept this basic Japanese policy as the basis for vision of the treaty.
Tu view of the unacceptability of the Japanese policy, Japan's reply to the British and American notes con~ sequently will be tantamount to a rejection of Anglo-American demands fora multi-atorai settlement pending problems in the Far East.
Observers recalled that the United States announced in December when the latest American note was de-ivered to Japan that the note presented Washington's "nal" communication regarding respect for solemn treaties in the Far East. If this note is rejected, some observers believe, the United States. will have} only the choice of taking action against Japan, probably in the form of economic sanctions, or remaining quietly aloof from the Far East, The same quarters believe that sentiment expressed thus for in the now United States Congress indicates that America will not remain out of Far Eastern affairs, and it is believed Britain will take parallel action with the United States in Imposing economic sanctions against Japan if such faction becomes necessary.—United Press,
Text read from the printed page and cleaned; old type leaves the occasional error.