IMMEDIATE I am greatly concerned to see that more and more S.C.A.P. and the State Department are by-passing Far Eastern Commission and the [Allied] Control Council.
2. We have come to the conclusion, as I stated in the House that the United States Government seems not to wish to pursue the peace treaty, but rather maintaining present position always seeing in Japan a possible instrument which might be used against Russia.
3. We cannot accept this dangerous policy for the obvious reason that while Japan might be built up for this purpose there is no guarantee that her industrial potential will not be used to pursue her ambitions in this area. Section of S.C.A.P. ever encourages her to look south as a source of essential supply by focusing Japanese attention on fishing and on other expeditions which have recently been rumoured such as departure of Japanese for Hainan Island for work in the steel industry, pearling and whaling expeditions.
4. During the war as you will remember we always took the view that we would welcome United States into the Japanese mandates as they would form a United States strategic interest and finally prevent Japanese expansion south. Now, however, United States interest is not in Japan as an aggressor and we note that Japanese are being allowed even into the territories which we agreed should be a United States trusteeship. This is a misuse of the trusteeship particularly as trust territories have been regarded as security area' 5. In all these circumstances I consider that you should personally take up at F.E.C. two of the current questions firstly the visits of Japanese outside Japan and secondly the question of fishing outside Japanese waters.
6. Our policy on both is quite clear. We have agreed to Japanese officials accompanying S.C.A.P. officials to international conferences as technical advisers but in no other capacity. We would be prepared to agree to other visits by Japanese subject to the concurrence not only of the country concerned but of F.E.C. On fishing and whaling our views have been made perfectly clear, but S.C.A.P. has ignored them on every occasion. While there might be a possible case for fishing from the point of view of supplying food and oil there is no case for pearl fishing. There are reports of Japanese expeditions being in proximity of our Australian mandated territories. One Japanese fishing ship has already been discovered in south of areas authorised by S.C.A.P. and within Australian territorial waters. We would only be prepared to agree to fishing outside Japanese waters with the concurrence of the country particularly concerned and of course F.E.C.
7. I should like you to take these matters up personally not only in F.E.C. but with State Department, working always in close co- operation with United Kingdom and New Zealand.