Both in Britain and in Japan, there were influential figures who advocated rapid rapprochement between these two countries on the eve of the Sino-Japanese war. The Japanese ambassador in Britain, Shigeru Yoshida, was one of them. His attempt to bring about an Anglo-Japanese agreement and Britain's response to it have already been analysed by several historians. The aim of the writer in dealing with this Anglo-Japanese negotiation is to throw additional light on the British attitude towards Japan by putting stress on her estimate of the power of the "moderate elements" in Japan and on the aspect of "economic appeasement", i.e. the plan to abolish the colonial quota system against Japanese textile goods. This policy began to be considered seriously in 1937. It was thought that such a policy would strengthen the hands of the "moderate elements" in Japan, who were supposed to be regaining self-confidence. But the outbreak of the war destroyed the chance to carry this policy into effect.