Manila, Feb. 18.
Sir Geoffrey Morthcote, Governor of Hongkong, recently wired the British Foreign Office advising the establishment of branches of the Ministry of Economic Warfare at Shanghai, Hongkong and Singapore for the purpose of controlling the export of war commodities to Russia, businessmen from Hongkong revealed here today.
Hongkong exporters also sent a representation to Sir Archibald Clark Kerr, British Ambassador to China, regarding the increase of Chinese exports to Russia, it was. learned. The Ambassador replied to the note, saying he had received assurances that no Chinese products received by Russia under the Sino-Soviet barter system were reaching Germany.
British and American exporters at Hongkong, however, asserted that their markets were practically denuded because of the Soviet monopoly on numerous commodities besides tea, including phosphates, antimony, wolfram, hides and many other materials obviously war necessities, The huge quantities of materials being shipped to Russia were sufficient proof that they were reaching sources other than the Soviets, these businessmen claimed.
Hongkong naval circles urged that strong representations be made to London for the establishment of a contraband control centre at Hongkong because of the increasing number of ships being chartered: by Hongkong firms for trading with Vladivostok.
Hongkong "business firms recently chartered two former Norwegian vessels for the Vladivostok run and one of these- ships recently returned to the British colony under ballast after taking. 60,000 chests of tea to Russia, it was understood.
Barter Arrangement Foreign trade advisers to the Chinese Government were understood to be urging Chungking closely to scrutinize existing agreements with Russia since the latter was apparently taking advantage of the barter arrangement for the fulfillment of Soviet obligations under the Russo-German trade pact.
Russia is supplying Germany with necessary war materials from China which cannot be obtained elsewhere because of the Allied blockade and American neutrality laws requiring cash-and-carry restrictions, Hongkong businessmen stated.
The Soviet steamer Selekga, which was recently seized by the British Navy while enroute to Vladivostok, was still in Hongkong when these businessmen left for Manila and it was understood that an additional wolfram cargo, totalling 700 tons, was being loaded on the ship while it was still in the Hongkong harbour, the businessmen stated. Apparently the Selekga's Captain anticipated Anglo-Soviet negotiations which would effect a release of the ship prior to the establishment of a contraband control centre at Hongkong, they said.
Meanwhile, shipping circles at Manila heard that two steamers recently left Manila loaded with copper ore for Vladivostok, it was learned.—United Press.
"Any settlement in the Far East," he said, Admiral Yarnell pointed out that the powers involved in the European war have important possessions in the Orient, "Their defeat in Europe might have a decided effect on their colonial possessions," he declared.
He strongly advocated that the United States place an embargo against Japan. "I believe we should embargo exports to any aggressor ruthlessly invading another nation. he asserted, The Admiral said he did not believe, however, that a United States embargo against Japan would materially affect the course of the Sino-Japanese hostilities in the immediate future, "The moral reasons far outweigh the material reasons," he said, "It just doesn't make sense that we should send medical stores to China to relieve suffering caused by Japanese aggression and, at the same time. send materials for making war to Japan."
Philippines Position Admiral Yarnell declined to' advocate any specific embargo programme. He said Congress should follow the suggestions of the State Department whether to institute embargo on exports of war mate to Japan or invoke the Neutrality act—preventing United States trade with either side except on the "cash and carry" basis.
Discussing Philippines independence, Admiral Yarnell said the islands "are in a dubious position" as a result of Far Eastern developments. Any move to change the present act giving the Philippines their independence in 1946 should "come from the Filipinos themselves," he asserted.
The present military force in the Orient is not sufficient to defend the islands, Admiral Yarnell said. "In the event of war we would have to fall back to Hawaii as our western outpost".
The Philippines might be easily captured, Admiral Yarnell continued. "But their retention," he added, "would depend on the outcome of th war, which would be a long-drawn-out test of endurance," despite the establishment of small naval bases on several mid-Pacific islands and the Navy's plans to spend US$4,000,000 on improvements of Guam facilities, "Hawaii must be considered the United States' western base in the Alaska-Hawaii-Panama triangle," Admiral Yarnell declared. "This must be the United States' first line of defence in any war in the Pacific."—United Press.
U.S. Forced to Take Initiative?
Tokyo, Feb. 18.
The view is gaining strength in Japan that the attempts of the Foreign Office to negotiate a new trade treaty with the United States is hopeless and therefore it is necessary to force the United States to take the initiative in discussions leading to an agreement on a new commercial treaty, the "Miyako Shimbun" said today.
The discussion of "political items, such as exchange control, currency, and customs in China, the newspaper declared, "should be left to negotiations between the United States and Mr, Wang Ching-wei (leader of the rump "Kuomintang") after the latter's regime is established and recognized by the United States."
The Japanese announcement that the Yangtze River would be opened to Third Power navigation is "Japan's last card," the "Miyako" continued. Since the United States has not responded to this, "it is not unreasonable for Japan to retract the announcement," the newspaper said—United Press. been requisitioned by the staff officers for military use, the reporters declared.—Havas.
Text read from the printed page and cleaned; old type leaves the occasional error.