Memorandum Prepared in the Division of Far Eastern Affairs45

Shipment From the United States to China, Hong Kong, and Macao of Arms and Munitions of War

According to the records of the Department there were approved during the period January 1, 1932, to and including October 22, 1934, applications for license to export to China, Hong Kong and Macao arms and munitions of war valued as follows:

1932 $448,689.12
1933 3,017,947.35
1934 to October 23 3,554,768.07
Total $7,021,404.54

With regard to declared points of destination, the above total of $7,021,404.54 may be subdivided as follows:

[Page 517]
1932 $448,689.12
1933 2,973,927.75
1934 to October 23 3,523,530.64
Hong Kong
1932 00
1933 43,626.00
1934 to October 23 31,237.43
1932 00
1933 393.60
1934 to October 23 00

(detailed statements attached hereto)46

Exports to China, Hong Kong and Macao of arms and munitions of war valued at $564,763.12 were approved by the Department during the fourteen months’ period January 1, 1932, to March 1, 1933. Exports valued at $5,072,887.25 were approved during the succeeding fourteen months’ period ending April 30, 1934. This sharp increase in the value of arms and munitions of war destined for shipment to China was due entirely to improved conditions within the trade and in no way to a relaxation of the rigid control exercised by the American Government over the export to China of the goods under consideration.

In considering the figures stated above, note should be made of the fact that presumably, but not necessarily, delivery has been made of practically all of the goods covered by export licenses issued by the Department. An outstanding exception, however, is found in the item of 25 Northrop airplanes valued at $1,034,550 and covered by an export license issued by the Department on October 18, 1934, in connection with which no deliveries to China have been effected. (In informing the Department of this large purchase by the Chinese Government, the Consul General at Shanghai made mention of the reported purchase, also by the Chinese Government, of 50 military planes of Italian manufacture, i. e., double the number of planes ordered of Northrop manufacture.)

Note should also be made of the fact that, with a view to avoiding possible delays at the port of exportation, shippers to China occasionally apply to and receive from the Department a license to export to China materials of a non-military nature such as, for example, commercial airplanes. The result of this practice is an increase in the declared value of shipments to China, Hong Kong and Macao of arms and munitions of war. It is believed, however, that to date the total of such items is not of great consequence.

As of possible interest in connection with the foregoing it may be stated that, according to statistics prepared by the Chinese Maritime Customs, total imports into China during 1933 of arms and ammunition (not including aircraft) were valued at US$9,063,047 (Customs [Page 518] Gold Units (C. G. U.) 17,652,994 at average exchange rate of .5134). According to Department of Commerce figures, the value of exports from the United States to China in 1933 of the commodities named amounted to US$23,953 or approximately one-fourth of one per cent of China’s purchases of arms and ammunition. Thus it would appear that, with the exception of aircraft, the United States serves as a source of supply for only a very small portion of China’s purchases of arms and munitions of war.

  1. Submitted by the Under Secretary of State to the Secretary of State by letter dated October 27.
  2. Not printed.