Foreign Relations of the United States, Diplomatic Papers, 1945, The Far East, China, Volume VII

102.1/10–1645: Telegram

The Secretary of State to the Chargé in China (Robertson)

Washington, October 16, 1945—5 p.m.

1680. For Adler from the Secretary of the Treasury.

1. In connection with settlement of outstanding advances to the U. S. Army by the Chinese Government, Treasury’s present thinking is to propose to the Chinese Government that it credit us with the yuan obtained from the sale of surplus property against our yuan obligation to the Chinese.⁶¹ We do not know the total value of the surplus property to be disposed, so we do not know whether the proceeds are likely to be less or more than our current obligations to the Chinese.

2. Please keep Treasury currently informed of developments on this matter, particularly cabling your views as to whether the Chinese are stalling in making reply. It is essential that the disposal of this property be expedited as quickly as possible.

3. If the Chinese Government accepts this method of settlement, the question of the specific exchange rate to be used would be avoided by selling the surplus property to the Chinese Government at the best yuan price obtainable. [Morgenthau.]

Byrnes

61. In telegram No. 1689, October 17, 4 p.m., the Department indicated that it was the intent of the Treasury Department to instruct Mr. Adler to advance this proposal to the Chinese Government.