893.5151/979a: Telegram

The Secretary of State to the Ambassador in China (Gauss)

15. From the Secretary of the Treasury11 for Adler.12

A request “that, if agreeable to the U. S. Government, the Treasury’s General Licenses such as No. 75, be amended appropriately” was made by Dr. Kung13 in a telegram addressed to Secretary Morgenthau, dated November 25, 1943,14 which was left with Mr. Morgenthau on November 30 by Ambassador Wei, regarding termination of 1941 agreement.15
The changes which the dissolution of the Stabilization Board will make necessary in Foreign Funds Control documents are being given consideration by the Treasury, which suggests that:
The Central Bank of China, or the Commission for Control of Foreign Exchange Assets, or other appropriate Chinese institution assume the functions of the Stabilization Board under General Licenses Nos. 58 and 75 and that Foreign Funds documents be amended accordingly;
Treasury will now consult with the appropriate Chinese institution through Treasury representative in China in those cases wherein Treasury would have consulted with the Stabilization Board before granting licenses;
Treasury, in its licensing policy here, would follow a more liberal policy in cases where private Americans have made arrangements for relief, charitable, and religious organizations, news correspondents, and other individuals or groups to overcome difficulties arising out of exchange rate.
The Treasury would be pleased to receive your views and comments on above proposals, including answer to the question whether a stiff attitude against approving transactions which involve Americans making special arrangements to overcome official exchange rate is likely to be taken by appropriate Chinese institution in case it is consulted by the Treasury as the Stabilization Board was. [Morgenthau.]
  1. Henry Morgenthau, Jr.
  2. Solomon Adler, alternate American member of the Chinese Stabilization Board; upon liquidation of the Stabilization Board Mr. Adler remained in China as Treasury Department representative.
  3. H. H. Kung, Chinese Minister of Finance.
  4. Not found in Department files.
  5. For previous correspondence on this subject, see Foreign Relations, 1943, China, pp. 457 ff.