JAPAN
You will no doubt have heard from the Washington Legation of
Lothian's [1] interview With Welles [2] on 20th June when the
latter, after hearing Craigie's [3] reports, agreed with his view
that there was a risk of the Japanese Army making a move in Indo-
China. [4]

With regard to proposed declaration by the United States (my
telegram No. 450 [5]) Welles said that his Government could not at
present go beyond declaration made some time ago in connection
with the Netherlands East Indies. He thought that better method
was for the United States to show its immediate interest in the
situation through activity of Grew [6] with Tokyo Foreign Office,
and that public declarations should be avoided.

With regard to U.S.S.R., and possible pressure from the United
States Government, Welles said he thought that the Soviet[s] were
so alarmed by the German situation that it was unlikely that they
would at the moment make any move which would cause trouble for
them with Japan.

No comment has yet been received from Washington with regard to
what course the United Kingdom should follow if Arita [7] presents
demands regarding supplies through Burma and withdrawal of troops
from Shanghai. Craigie has urged that the time is rapidly passing
when diplomatic support from the United States in connection with
Shanghai issue will be of much use and that what is wanted-
urgently-is an assurance from the United States that should the
United Kingdom maintain troops in Shanghai and thereby become
involved in trouble with Japanese they may rely on America's armed
support.

The French Ambassador at Tokyo [8] considers that campaign against
Great Britain will become greatly intensified and that unless we
can be sure of full American solidarity in regard to troops and
Burmese trade we should be well advised to meet the Japanese as
far as possible on these questions.

Consideration is now being given here to what the United Kingdom
attitude would be in the event of attack on Indo-China.

BRUCE