893.24/573: Telegram

The Ambassador in France ( Bullitt ) to the Secretary of State

1051. The Chinese Ambassador63 said to us today that despite the orders issued by the Minister of Colonies to the authorities in Indo-China to suppress the transit duties on supplies destined for the Chinese Government the duties were still being collected. The local authorities have appealed to the French Government on the ground that failure to collect these duties would result in serious financial loss and that the duties should continue to be collected until new revenues have been found to take their place. The Ambassador said that he was urging the French Government to insist that its instructions be carried out.

Wellington Koo stated that in addition to the export credits to be used in the construction of the railway between Yunnan and Chungking he had recently requested the French Government to extend credits for constructing chemical factories in Yunnan for the production of explosives.

The Ambassador also stated that he had asked the French Government to suspend the transit duties and to provide adequate railway facilities for the transit through Indo-China before the end of this year of tung oil shipments in the total amount of 25,000 tons destined for the United States in connection with arrangements made at the time the Chinese credit was obtained through the Export-Import Bank.

  1. V. K. Wellington Koo.