The Ambassador in China ( Hurley ) to the Secretary of State
[Received May 22—9:05 a.m.]
822. Outstanding feature of Chinese cotton textile plans (ReEmstel 821, May 22, 11 a.m.) brought to attention of Remer and Dawson by prominent and competent member of industry is belief number [of] Japan’s spindles now reduced to 3,750,000, remainder having been scrapped. This number would be only about enough for home consumption of textiles. This great deficit in producing capacity for pre-war Far Eastern textile markets would exist. China’s plan for export envisages absorption of most of this if efficient expanded industry can rapidly be built.
While evidence of this reduction is not direct, informant firmly believes his sources are reliable but Remer and Dawson of opinion this drastic reduction spindles needs further confirmation before complete acceptance.