nment the latter
did not manifest the least appreciation for Japan's good will and
difficulties.

From the commercial and military point of view Kiaochow is an
important place, in the acquisition of which the Japanese Empire
sacrificed much blood and money, and, after the acquisition the
Empire incurs no obligation to restore it to China. But with the
object of increasing the future friendly relations of the two
countries, they went to the extent of proposing its restoration, yet
to their great regret, the Chinese Government did not take into
consideration the good intention of Japan and manifest appreciation
of her difficulties. Furthermore, the Chinese Government not only
ignored the friendly feelings of the Imperial Government in offering
the restoration of Kiaochow Bay, but also in replying to the revised
proposals they even demanded its unconditional restoration; and
again China demanded that Japan should bear the responsibility of
paying indemnity for all the unavoidable losses and damages
resulting from Japan's military operations at Kiaochow; and still
further in connection with the territory of Kiaochow China advanced
other demands and declared that she has the right of participation
at the future peace conference to be held between Japan and Germany.
Although China is fully aware that the unconditional restoration of
Kiaochow and Japan's responsibility of indemnification for the
unavoidable losses and damages can never be tolerated by Japan yet
she purposely advanced these demands and declared that this reply
was final and decisive.

Since Japan could not tolerate such demands the settlement of the
other questions, however compromising it may be, would not be to her
interest. The consequence is that the present reply of the Chinese
Government is, on the whole, vague and meaningless.

Furthermore, in the reply of the Chinese Government to the other
proposals in the revised list of the Imperial Government, such as
South Manchuria and Eastern Inner Mongolia, where Japan particularly
has geographical, commercial, industrial and strategic relations, as
recognized by all the nations, and made more remarkable in
consequence of the two wars in which Japan was engaged the Chinese
Government overlooks these facts and does not respect Japan's
position in that place. The Ch