893.00/7–1044
The Second Secretary of Embassy in China (Rice) to the Ambassador in China (Gauss)96
Sir: I have the honor to report as follows statements, in regard to portions of Shansi under the control of Marshal Yen Hsi-shan, made by Bishop Thomas Megan … based on information supplied him by his subordinates and other informants.
Yen Hsi-shan fully controls only ten or eleven hsien (districts) in Shansi but also has a degree of administrative control in thirteen or fourteen others which are partly occupied by Japanese troops.
Although his troops occasionally clash with the Japanese, and possibly also with the Communists, Marshal Yen has limited political relations with both and commercial intercourse with the former. The Communists have a liaison office in the countryside several li from his headquarters at Konanp’o, Shansi, (Konanp’o is a small place [Page 469] northeast of Ichwan and on the east bank of the Yellow river.) Marshal Yen maintains an office in Japanese-occupied Taiyuan. Exchange of commodities between the Japanese and Yen Hsi-shan takes place at a spot called Itangchen. From Marshal Yen the Japanese obtain hides, Chinese herb medicines and hemp; from them he obtains much-needed cloth and other materials.
Respectfully yours,
- Approved by the Ambassador in China for transmission to the Department; received August 1.↩