The Acting Secretary of State to the Embassy in China
103. For Adler from Treasury. Please bring to attention of General Marshall immediately following action taken January 15 by National Advisory Council concerning conditions for financial assistance to China:
“When future political and economic developments in China provide reasonable assurance that credits will serve a purpose beneficial to both China and the United States, the National Advisory Council in passing on any recommendations for substantial credits pursuant to its action of January 8, 1946,33 will be guided by the following principles:
- A commitment for a substantial credit to the Chinese
should not be made prior to satisfactory action by that
Government with respect to the following:
- The prompt negotiation of a treaty of commerce and navigation.
- The establishment of acceptable exchange facilities either by making foreign exchange available at reasonable rates to American nationals, or by giving the Embassy a written waiver of penalties against individuals or companies who, in the absence of reasonable official rates of exchange, may have resorted to the open market.
- Steps toward the stabilization of Chinese currency, including the allocation by China of sufficient foreign exchange resources for this purpose. In this connection, China should be assured that if desired, technical advice of the International Monetary Fund or of proper agencies of the U. S. Government will be available.
- The determination of the actual amount and timing of
substantial credits for specific projects, which will of
course take into account the usual economic and financial
factors, should also be related in a flexible manner to the
character of Chinese action in the following and related
- Commercial policy of a non-discriminatory character.
- Tariff policy appropriately adapted to China’s resources and markets rather than to the development of a self-sufficient economy.
- Clarification of conditions governing the operation of foreign companies in a manner similar to those commonly imposed by other commercial countries.
- The admission of foreign companies to different categories of business on a most-favored-nation basis; adequate protection of legitimate rights of property, and assurance against discriminatory treatment of foreign companies and nationals.
- Clarification and extension of the area of private trade and enterprise, whether foreign or Chinese.
- Plans for the development of China’s economy of a character which will not unduly handicap existing Chinese or foreign enterprises.
- Satisfactory progress in settling such war obligations as lendlease and the purchase of surplus property.”