The formation of the New Four-Power Consortium and Japan’s “Manchurian-Mongolian Problem”

The purpose of the present article is to reexamine the characteristic features of Japan’s foreign relations, specifically its China policy, within the process of the formation of the New Four-Power Consortium in December 1920, as one aspect of the so-called “Manchurian-Mongolian Problem”. The article discusses 1) the relationship between the New Consortium and the Old Consortium (formed in June 1912), 2) the diplomatic activities of Great Britain, which was the central actor in the Old Consortium, and 3) the interrelationships among the principal policy-makers in Japan.<br> 　The formation of the Hara Takashi Cabinet in September 1918 was predicated on removing Manchuria-Mongolia (present day northeastern China and Inner Mongolia; hereafter Man-Mo Region) from all ventures financed by any new loan consortium in China. For example, during Japan’s deployment of troops to Siberia (1918-22), Army Minister Tanaka Gi’ichi stressed the importance of the Man-Mo Region from the standpoint of Japan’s global advancement, thus supporting the exclusion of US and British interests from the Region. Following initial US-British opposition to Japan’s exclusionary demand, British diplomats, recognizing the principle of “spheres of influence”, gradually changed their position and came to appreciate a special Japan-Man-Mo relationship.<br> 　Moreover, the Hara Cabinet refused to officially approve participation of Japanese financial institutions in the New Consortium, due to the Japanese Army’s opposition to the British government’s proposal to lend 500 thousand pounds under the condition that the Chinese brigade formed to be sent to the World War front with the support of the Terauchi Masatake Cabinet be disbanded. British diplomats decided to rescind the loan condition, fearing delays in the New Consortium’s formation. Consequently, while compromising on its total Man-Mo Region exclusionary stance, the Hara Cabinet demanded that all railway rights in the Region be excluded from the New Consortium’s planned ventures. In response to US-British opposition to such a demand, the Japanese government again compromised by offering its rights over the Region’s Taonan-Rehe 洮南熱河 Railway to the Consortium.<br> 　In sum, at the time of Japan’s participation in the New Consortium, internationally, the British accepted the existence of a special relationship between Japan and the Man-Mo Region, while on the domestic front, the interests of the Japanese Army formed an important decision-making criterion. Furthermore, despite the international cooperation shown by the Hara Takashi Cabinet, implementation of plans to intervene in China continued, in sync with changing conditions there.