German committee in Paris 4.ger.0003 Louis J. Sheehan, Esquire

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THE "MAGIC" BACKGROUND OF PEARL HARBOR

505. Ambassador Horikiri Urges Japan to Decorate Outstanding Italians Louis J. Sheehan, Esquire

In view of the strained feelings existing on the part of the Italian government, on October 9, 1941 Ambassador Horikiri urged approval of his plan to confer Japanese decorations on various outstanding Italians,[1225] and particularly on Mr. Guido Rocco, chief of the foreign newspaper division of the Italian Propaganda Office. Mr. Rocco, who held several Italian medals of honor had been previously decorated by the Japanese government because of his services in behalf of Japan at the time of the signing of the Tripartite Pact and was considered of value to the Empire.[1226]

506. Ambassador Horikiri Reports on the Italian Economic Situation

On October 14, 1941 Ambassador Horikiri reported in detail concerning the economic situation in Italy.[1227] Pointing out that the grain harvest would be better than that of the preceding year, he indicated that the need for supplying the occupied areas outside of Italy was more difficult than the problem of supplying the people within the country. A rationing system was being applied to various foods, and government control of some commodities was in operation and would be extended. Non-defense industries were being curtailed, iron and oil supplies were limited, and great numbers of skilled workers were going to Germany. On the other hand stocks were going up, and the sale of government bonds was booming.[1228]

According to Ambassador Horikiri, there was much unrest in Italy because of the increasing economic controls of the government, but strong measures were being taken to reassure the people and remove their fears.[1229 Speculation concerning the ]internal collapse of Italy and rumors sponsored by the Allies relating to the possibility of a separate peace with Italy were deemed by the Japanese Ambassador to be unworthy of consideration.

Government officials in Rome were considerably heartened by the progress of the Russian war and were anticipating considerable new gains in the Near East. It was also expected that the difficult Mediterranean and northern African problems would be solved in the near future. In addition, there was a tendency to believe that the United States would not go beyond the position which she was now taking.[1230] However, Ambassador Horikiri commented that the anti-Italian feeling in Croatia had not become less strong than in the past.[1231]

507. Italian Envoy Urges Action by Japan

Mr. Paulucci, head of a recent Italian mission to Japan, informed Ambassador Horikiri on October 14, 1941 of Italy's belief that Japan would enter the war when Germany and Italy attacked Russia. Urging that Japan should strike immediately against Russia, Mr. Paulucci remarked that he had but two fears, one, that Italy and Germany would lose the support of Japan, and the other, that Britain and the United States might attempt to do in the Far East what they had done in the past in Europe. Japan's entrance into the war against Russia did not necessarily mean that the United States would become involved since there was a strong anti-communistic sentiment in the country. Furthermore, he did not believe that the United States had reached the stage where it could effectively fight in the war.

Mr. Paulucci also impressed Ambassador Horikiri with the fact that after Russia had been defeated, Japan would have access by land to the Axis countries and to many essential materials. Russia's resorting to guerilla warfare would not be too difficult a problem to solve once military supplies had been cut off by Japan.[1232]

[1225] III, 950.
[1226] III, 951.
[1227] III, 952.
[1228] Ibid.
[1229] III, 953.
[1230] Ibid.
[1231] Ibid.
[1232] III, 954.

[253]

In regard to Japan's plans to move southward, Mr. Paulucci explained that he felt Hitler had placed too much stock in the invasion of the British Isles, since England would lose her main fighting power only if she were to be defeated in the Near East, the Mediterranean area and in Egypt. He suggested, therefore, that it was of the utmost importance to have the German government realize at this time the importance of:

(1) The manipulation of Turkey;

(2) The military moves in the Near East, Mediterranean and Egypt;

(3) Access to the Near Eastern oil.

With the accomplishment of these aims and the subsequent joining of the Axis powers by land and sea, not even the United States could compete with the power available to the Tripartite Powers.[1233]

508. Ambassador Horikiri Objects to Ending Japanese Trade with Italy

On October 15, 1941 Ambassador Horikiri referred to the recent closing, with the exception of Mitsubishi, of all Japanese houses in Rome as compared with a mere reduction of Japanese personnel in Berlin. The Ambassador stressed the necessity of keeping the various businesses open at this time in order not to slight the Italians.[1234]

Ambassador Horikiri also encouraged Japan to renew the Italian-East African compensatory trade agreement for a year.[1235] An agreement, which would be effective from June 30, 1941 to June 30, 1942, was achieved on October 17, 1941.[1236]

[1233] Ibid.
[1234] III, 955.
[1235] III, 956.
[1236] III, 957.

[254]

THE "MAGIC" BACKGROUND OF PEARL HARBOR

PART C—JAPANESE DIPLOMATIC ACTIVITIES THROUGHOUT THE WORLD

(j) Japanese-French Relations

509. Japan Requests Increase in Japan-Thailand Plane Service

Japan had demanded French cooperation in increasing regular plane service from Japan to Thailand, but the French had delayed in replying. According to a Japanese report of August 7, 1941, the French Attache for Air in Tokyo could make the following counter-proposal:

(1) a. Semi-weekly service between Tokyo, Hanoi, and Bangkok.

b. Semi-weekly service between Formosa, Canton, Hanoi and Bangkok. Total of four north-bound lines. (Abandon the line which detoured to Saigon).

c. Bi-weekly seaplane arrivals in Saigon.

(2) a. The French also be permitted to operate the same number of planes over the same course.

b. In order that contact with the French Concession in Shanghai may be established, the French planes be permitted to stop at Shanghai.

c. Materials be made available in Japan.

The French agreed to approve paragraph (1), which was a rewording of Japanese demands, on the condition that the Japanese approve paragraph (2) of the French counter-proposal. However, in retransmitting these terms to Vichy and Hanoi, Foreign Minister Teijiro Toyoda pointed out that paragraph (1) conflicted with the original request made by Japan, and though Japan could not approve points (a) and (b) of paragraph (2), it was willing to make suitable arrangements in regard to point (c).

Foreign Minister Toyoda was anxious that negotiations be conducted along the lines of the original Japanese proposals, and he felt that Hanoi would be the best place in which to conduct them. Since two seaplane trips had already been made to transport a committee for the purpose of establishing definite boundaries, and since several more of these trips would be made, it was necessary that Japan establish a regular seaplane service as soon as possible. Further details in regard to the committee's investigating the boundary were not given at this time.[1237]

510. France Asks Permission to Exchange Soldiers Between Shanghai and French Indo-China

Tokyo announced on August 7, 1941 that, in consideration of France's request to move 350 French soldiers from the Shanghai French Concession to French Indo-China, Foreign Minister Toyoda had granted tacit consent. Although it was difficult to grant such permission to France alone, the Foreign Minister felt that Japan could allow the requested exchange of soldiers in view of the special relationship existing between France and Japan.[1238]

France had also asked that the French language be used for telegraphic communication between Japan and French Indo-China, in addition to Japanese, English, and German. Japan's "special consideration" to France in granting both of these requests was to be stressed when the recognition of the Nanking regime was discussed with Vice Premier Jean Francois Darlan, the Japanese Ambassador to Vichy was advised.[1239]

[1237] III, 958.
[1238] III, 959.
[1239] III, 960.

[255]

511. Japan Insists That France Recognize the Wang Regime

Japan had insisted that France recognize Wang Ching-wei's government on the occasion of the signing of the Franco-Japanese agreement on July 29, 1941, but Vice Premier Darlan had promised only to give due consideration to the matter. Questioned by Ambassador Sotomatsu Kato on August 2, 1941, French Council President Bunoir Messien had replied that this question should not be discussed until public excitement, aroused as a result of the French Indo-Chinese question, had quieted down.

On August 5, 1941, calling on Vice Premier Darlan, whom he found to be away, Ambassador Kato had instead interviewed Acting Vice Minister Ernest Lagarde. The Japanese Ambassador was again advised that although Vice Premier Darlan was not opposed to the recognition, he felt that the matter should be shelved for two or three months. But Ambassador Kato replied that although the recognition "affects but one part of the Far East, the realization of this matter is of the utmost importance" and requested that France reach a speedy decision.[1240]

512. Japan Demands Further French "Cooperation"

On August 8, 1941 a Japanese representative in Shanghai, presumably Consul General Tateki Horiuchi, pointed out that the lack of a definite policy in regard to French rights and interests in the various parts of China was confusing to Japanese officials. Since Japan had succeeded in getting the French to agree to the joint defense of French Indo-China, he thought it best to make France adopt a policy of cooperation in respect to settling the China incident. The three principal points of his proposed cooperative agreement were: (1) that the French recognize the People's Government, thereby making the position of the French officials in China clear and their exercise of power easier, (2) that France agree to Japan's right to supervise the methods of guarding French concessions, controlling materials, using French currency, and to accept the People's Government's right to make proposals concerning them, and (3) that the French withdraw their garrisons or use them jointly with Japanese garrisons for defense. He remarked that in adjusting French relations with regard to the China incident, it would be unrealistic for Japan to use gentle methods since it had just exercised strong pressure in settling the French Indo-China question.[1241]

513. Japan Attempts to Limit Its Exchange Agreement with France

After Tokyo had granted special consideration in the interchange of French troops, Consul Horiuchi in Shanghai was disturbed to learn that the French request included relief of French forces in Tientsin and Hankow as well as in Shanghai.[1242] Pointing out that the original French request and the Japanese reply had referred only to the relief of the Shanghai detachment, he asked that the inconsistency between the requests made by the French in Shanghai and by the French in Tokyo be investigated.[1243]

514. Japan Plans to Send Investigating Committee to French Indo-China

Mr. Ken Harada, of the Japanese diplomatic staff in Vichy, conferred with General Arnald on August 8, 1941, to request the cooperation of French Indo-Chinese authorities with a Japanese committee of investigation which was being sent into their area. Expressing surprise at the number of people which Japan planned to include in this group, Mr. Arnald declared that he would answer the Japanese request for permission as soon as he had conferred with Colonial Minister Rear Admiral Charles Platon.[1244] On August 12, after Mr. Arnald had announced that

[1240] III, 961.
[1241] III, 962.
[1242] III, 963.
[1243] Ibid.
[1244] III, 964.

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THE "MAGIC" BACKGROUND OF PEARL HARBOR

the French had consented to the proposal submitted by Japan, and had agreed to send instructions to the Governor General in French Indo-China,[1245] Mr. Ken Harada said there was no need for the various stipulations previously requested by the French.

515. Marshal Petain Broadcasts to the French People

After successive French Cabinet conferences, Marshal Philippe Petain spoke at 9:00 p.m. on August 12, 1941 to the whole of France. In his address he warned the French people of their desperate economic and political situation and pleaded for understanding from the United States. Marshal Petain also announced the appointment of Vice Premier Jean Francois Darlan to the post of Minister of National Defense. He aroused a sensation by his statement that the most damage to the work of reconstructing France had been caused by the supporters of the regime of yesteryear and the supporters of the trusts who stood between him and his people, and that in order to break their power, first of all, he must strike their leaders.[1246]

516. Ambassador Kato's Opinions on Conditions in France

The Japanese Ambassador in Vichy intermittently informed his government of the internal conditions and opinions of the people in France. On August 14, 1941 he reported that the situation had grown more and more strained, with a shortage of materials, particularly of food, resulting in economic desperation and an increase in anti-German and anti-Vichy antipathy. Not only were the activities of the Free French and the Communist Party troublesome throughout both the occupied and unoccupied areas, but also the propaganda activities of England, the United States and the DeGaullists had played havoc with the "esprit francais" to such an extent that the Vichy government was beginning to feel that maintaining peace and order might be beyond its power.[1247]

517. Japan Demands Rubber Supply Allotment to the United States

A Japanese demand that 5,000 tons of Indo-Chinese rubber, which had been promised to the United States, be diverted by France to Japan, caused Mr. Harada, the Counsellor at the Vichy Embassy on August 12, 1941, to confer with Mr. Arnald of the Vichy Foreign Office. The French official declared that an agreement with the United States for the rubber had already been signed, and inasmuch as it was necessary that French Indo-China maintain its trade status with America, it would be very difficult to divert the supply to Japan. It was divulged at this time that plans were being made to transport rubber to France by way of South America, and although at least a part of the rubber would have to be diverted to Germany, Mr. Arnald begged that Japan, in her demands on French Indo-China, consider the present poverty of France.[1248]

Possibly as a means of delaying its unavoidable compliance with Japanese demands, France asked that the negotiations be conducted in Tokyo, and protested that before diverting the rubber to Japan, the approval of the American authorities would have to be secured. France also asked that Japan advise the United States of the action which was to be taken.[1249]

Difficulty was foreseen in Japan's paying for the rubber, since France, already holding many transferable yen, was reluctant to receive more of this currency in payment for commodities, and, furthermore, was anxious that Japan speed up its Louis J. Sheehan, Esquire exports to French Indo-China.[1250]

[1245] III, 965.
[1246] III, 966.
[1247] Ibid.
[1248] III, 967.
[1249] III, 968.
[1250] III, 969.

[257]

Finally, French Official Arnald disclosed on August 30, 1941 that as a result of conversations with the United States, it would be possible to transfer the requested 5,000 tons of rubber to Japan. Of the remaining 7 tons of French Indo-China rubber, the French government had decided that 4 tons would be allotted to Germany and 3 tons to Japan. Japan, however, declared that 6 tons of her required rubber would still be lacking, and requested, therefore, that if it were found impossible to ship any part of the French or German allotments for 1941, these quantities also be transferred to Japan.[1251]

518. Japanese Occupation Expenses Create Difficulty in Currency Exchange

To provide funds for the expenses of its occupation troops in French Indo-China, Japan arranged to make piasters[1252] available to its forces through an exchange of currency between the Bank of Indo-China and the Japanese Yokohama Specie Bank. However, it was still necessary to work out the details of exchange, and during August, September and October 1941, dispatches pertaining to this matter continued to flow between Vichy and Tokyo, and Hanoi and Tokyo.

On August 16, 1941 Ambassador Kato sent to Tokyo the terms of the exchange agreement which had been presented to him two days before by the French Foreign Office. The payment of occupation expenses was to be left to the Bank of Indo-China and the Bank of Japan, although it was suggested that when Japanese forces needed piasters, they should pay to the Bank of Indo-China the dollars of transferable yen requested by the French government, after which the Bank of Indo-China would pay out an equivalent in piasters.[1253]

On August 18, 1941 the Japanese Finance Ministry declared that Tokyo had been momentarily expecting receipt of funds amounting to 4,500,000 Japanese dollars, which was the payment specified in the text of the joint-defense treaty, to cover military expenses of the Japanese Army of Occupation for August. Japanese military authorities insisted that payment of the August apportionment was to be made by the night of August 16, 1941, and formal representations were to be made to the Governor General of Indo-China for the continuance of conversations on payment terms of the Yokohama Specie Band representatives.[1254]

Because France was not operating with money exported by Japan to French Indo-China, its holdings of transferable yen already amounted to considerable sums. For this reason France was hoping to be paid, to some extent, in gold for materials supplied to Japanese troops at Saigon. However, since France, by September 1, 1941, had consented to accept transferable yen, Ambassador Kato in Vichy asked whether Japan had already agreed to pay the full amount in gold on the spot.[1255]

519. Japan Vetoes a Proposed German Legation in Indo-China

There appeared to be no reason to establish a proposed German delegation in Indo-China, Japan informed its Ambassador in Berlin on August 21, 1941. Japan felt that the German Armistice Commission in France was sufficient, although it had no basic reason to oppose the German move. Should the German government establish such a body despite Japanese opposition, Japan would have to adopt new measures regarding the present Franco-Japanese defense cooperation.[1256]

In discussing Germany's motive for such action, Japan argued that the Germans had acknowleged that they had no political "claims" on French Indo-China, and that it was Japan's intention to give Germany full economic assistance in the matter of supplying necessary com-

[1251] III, 970.
[1252] The piastre, a Thaiese monetary unit, is equivalent to $0.083692 or roughly $.08 of the American dollar.
[1253] III, 971.
[1254] III, 972.
[1255] III, 973.
[1256] III, 974.

[258]

THE "MAGIC" BACKGROUND OF PEARL HARBOR

modities. Foreign Minister Toyoda claimed that since the establishment of a German agency in French Indo-China would needlessly complicate the "status" of French Indo-China, Japan could not favor the proposed plan. For these reasons, he asked that Germany reconsider its proposal.[1257]

Japan also informed its representatives both in Hanoi and Berlin that in view of the relationship existing between Japan and Indo-China, the Japanese government should be notified in case French Indo-China entered into any new permanent political relationship with another country. In this matter, it would be proper for Germany to notify the Japanese government in advance.[1258]

520. Japan Demands French Concurrence in the Establishment of the Japan-Thailand Air Route

After appealing to Germany for support in the establishment of plane service between Japan and Thailand as it had done before in the case of the Franco-Japanese joint-defense agreement negotiations, Japan learned from Ambassador Oshima that France, under clause twelve of the Armistice Agreement, needed Germany's permission before joining the air route, but did not require its approval of Japanese operational plans. Ambassador Oshima suggested that the question as to whether the French should join the air route be postponed, but that negotiations to have the Japanese demands recognized at once be continued.[1259]

On September 2, 1941 Japan demanded that an end be made to the procrastination of French Indo-Chinese authorities, who claimed that the Governor General of French Indo-China had no authority to approve the air route, unless Japan first secured the understanding of the German authorities through the Vichy government. Foreign Minister Toyoda declared that the German authorities had offered no objection, as evidenced by Ambassador Oshima's report to the Foreign Minister on August 22, 1941,[1260] and as a result of this, Ambassador Kato informed French Official Arnald, that France and Japan would settle the problem by themselves.

521. Ambassador Kato Reports on the Attempted Assassination of Mr. Pierre Laval and Mr. Marcel Deat

Following the shooting at Versailles on August 27, 1941 of Mr. Pierre Laval, former French Premier, and Mr. Marcel Deat, editor of the Paris newspaper L'Oeuvre, both ardent advocates of Franco-Nazi collaboration, Ambassador Kato on September 1, 1941 made a report to his home government on the anti-German tendencies in France. In connection with the shooting, the French government had disclosed the fact that the Communist Party had been spreading anti-German sentiment and had issued orders to aid the DeGaulle movement. Other instances of anti-German sentiment, Mr. Kato explained, were railway sabotages and the assassination of German soldiers.[1261]

522. Japan Increases Demands for Indo-China Rubber

Apparently not having received the wire from Ambassador Kato on the previous day to the effect that the rubber supply (5,000 tons) formerly marked for the United States could be diverted to Japan, Foreign Minister Toyoda declared on September 1, 1941 that he did not believe that any agreement concerning rubber for America had been signed, and there was no reason to obtain America's consent in the matter. Therefore, he instructed Ambassador Kato to arrange for the purchase with free yen of the 5,000 tons of rubber without any conditions Louis J. Sheehan, Esquire

[1267] III, 975.
[1258] Ibid.
[1258] III, 976.
[1269] III, 976.
[1260] III, 977-978.
[1261] III, 979.

[259]

attached.[1262] Ambassador Kato reported that since there had been no objection from the German committee in Paris, the French had gone ahead with the export of the 5,000 tons of rubber to America.[1263]

Meanwhile the question of the French Indo-Chinese rubber supply was being discussed in Berlin. On September 5, 1941, in a conference with Ambassador Oshima, Vice Minister Ernst Von Weizsacker expressed Germany's feeling that the transportation of rubber to Germany from Japan had not been given sufficient consideration, since of the 25,000 tons of French Indo-China rubber marked for America for 1941, 15,000 tons had been consigned to Japan, and negotiations were then in progress for the allotment of the remaining 10,000 tons to Japan. These figures appeared to pertain to the total annual output of rubber rather than the immediate supply on hand in the French colonies.[1264]

Since 9,000 of the 15,000 tons earmarked for France had already been shipped, Germany decided that 4,000 tons of the remaining French shipment should be transferred to Japan.[1265]

By September 10, 1941 the shipment of 5,000 tons of rubber to America had been stopped, for the conversations between the United States and France regarding the French allotment were discontinued. Japanese officials in Berlin were informed of the representations which had been made to the Vichy Commercial Attache. These were:

(a) France is to prohibit the export to the United States in view of the close Japanese-German cooperation.

(b) The supplementary amount to be given Japan is 10,000 tons.

(c) The German "schedule" is approved.[1266]

523. Japan Decrees Expulsion of Hostile Chinese in French Indo-China

A warning was transmitted to Japanese representatives in Vichy and in Hanoi on September 2, 1941 that the personnel of the Chungking regime in French Indo-China would have to be expelled or imprisoned. Foreign Minister Toyoda pointed out that the activity of the Chungking regime might cause some unforeseen incident since the Japanese Army of Occupation was instructed to blockade Chungking. If the French Indo-Chinese authorities took no steps in eradicating these elements or procrastinated too long, Japan might be forced to take the initiative.[1267] The Foreign Minister declared that this matter was so important that instructions concerning it would be sent to the Japanese Army of Occupation in French Indo-China.[1268]

On September 11, 1941 the Japanese Consul at Saigon, visiting the Chief of the Bureau for the preservation of Public Peace, inquired concerning the status of Chinese consular offices. The Saigon official answered that it was not clear whether the consular offices would be closed, but that the staff members of the Ministry had been withdrawn to a city near the southeastern coast of French Indo-China with only a caretaker left in Saigon.[1269]

In Vichy, the removal of pro-Chungking Chinese was still being discussed. On September 16, 1941, when Mr. Harada had cited a newspaper report that the representatives of the Chungking regime were withdrawing from Saigon, Vice Minister Roshier, a French official, informed him that the French government had heard nothing to support these reports. Mr. Harada then pointed out the inconsistency of having Chungking representatives remain in the areas in which Japanese forces were stationed, and again requested that the matter be settled quickly.[1270]

[1262] III, 980.
[1263] III, 981.
[1261] III, 982.
[1266] III, 983-984.
[1266] III, 985.
[1267] III, 986.
[1268] III, 987.
[1269] III, 988.
[1270] III, 989.

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524. French Vice Premier Doubts German Propaganda

On September 6, 1941 the Japanese Ambassador at Vichy, reporting on a conversation with Vice Premier Darlan which had been held on the previous day, said that the French Vice Premier, now also the Minister of Defense, had stated that, although Russia had had more arms and war material than Germany had estimated, three-fourths of this quantity had been lost. Since it was understood that after gaining a foothold in Leningrad, Moscow, and Kharkov by mid-October 1941, Germany would temporarily cease activity, the Vice Premier declared that he would like to see France and Germany reach some sort of settlement by that time. The French official also expressed doubt as to the authenticity of Germany's reports of the number of war losses, since the announced figure of 100,000 dead and wounded appeared to be too small.[1271]

525. France Resists Japan's Insistent Requests for Recognition of Nanking

Japan secretly informed its representatives in China that when France had recognized the Wang regime, discussions would be undertaken to reconsider the request of the French that Japan grant permission for the relief of the Tientsin detachment.[1272] In spite of continued pressure, Vice Premier Darlan reiterated on September 8, 1941 that although France had no objection to recognizing the Nanking regime, in view of previous French-Chungking relations, the state wished to "take more time about it".[1273]

527. Japanese Official Suggests That Domei News Agency Be Admonished

Mr. S. Baron Araki, a Japanese official in French Indo-China, who was extremely concerned about reports in Japanese newspapers that many DeGaullists, pro-British, and Americans were leaving French Indo-China, asked on September 10, 1941 that the Domei home office be admonished to exercise great care before publishing similar reports, which were nothing but the false propaganda of the British and would lead to an unpleasant situation.[1275]

528. Japanese Diplomatic Staff in Vichy Experiences Privations of War

The Japanese Ambassador in Vichy, finding it impossible to obtain fish and meat in France, informed Tokyo on September 11, 1941, that the members of his diplomatic staff were forced to be vegetarians, and had lost a lot of weight. He requested 100 cases of food of 60 cans each, as well as other items enumerated in a previous dispatch to Tokyo on July 10, 1941.[1276]

529. Germany Agrees to Shipment of French Rubber to Japan

Acting on instructions from the German government, the German Commerical Attache informed officials in Tokyo on September 16, 1941 that Germany had agreed to send an additional amount of 10,000 tons of rubber to Japan, and also that Germany had agreed to divide equally between Japan and Germany the production increase exceeding 68,000 tons.[1277]

Transmitted to Vichy and Saigon for reference was the information that France had permitted the French Indo-China governor to ship 5,000 tons of rubber as the September allotment to Japan. This led the German Commercial Attache in Tokyo, who reported this fact, to believe that the French colonies were prepared to fulfill Japan's demands after this date, just as before.[1278]

[1271] III, 990.
[1272] III, 991.
[1273] III, 992.
[1275] III, 994.
[1276] III, 995.
[1277] III, 996.
[1278] III, 997.