893.24 FLC/6–1747: Telegram

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

903. [In] View [of] failure Chinese authorities correct erroneous statements49 by Dr. George Yeh50 June 4 press conference (Shanghai’s 1475, June 17 to Nanking; repeated Dept 1465,51 and FLC Manila as 66) Dept releasing today following press statement which will be included Far East Wireless Bulletin and Voice of America:

“The China and Eastern Asia Office of the Foreign Liquidation Commissioner has announced that contrary to previous reports, as of May 31, 1947, about U. S. $170,000,000 procurement cost of movable surplus United States Property had been made available to China. These turnovers were made under the terms of the Bulk Sale Agreement of August 30, 1946. The current figure represents the first part of the $500,000,000 of property (procurement cost) provided for by the Agreement. Previous to the signing of the Agreement the United States Government had turned over to China a total of approximately $324,000,000 of property at cost in addition to the $500,000,000 of movable goods.

Movable property on which notices of availability have been sent to China include many types of equipment, including trucks, road and construction equipment, clothing, food and medical supplies, but specifically excluding aircraft, combat materiel, ships and other maritime equipment. The property is located in China itself and on 17 islands of the Pacific including Guam and Okinawa.

At the end of May, the Board of Supplies of the Executive Yuan had taken possession of $59,700,000 procurement cost of movable property. The rate of acceptance by China necessarily lags behind notification by the Office of the Foreign Liquidation Commissioner due to transportation problems and arrangements.

The procedures have been set up and large amounts of movable property have already been transferred to China. The transfer rate is now accelerated and under these procedures it is to be expected that the transfer operation will be completed within the 22 months allowed by the basic contract.”

Sent Nanking as 903, repeated Shanghai as 1204 and FLC Manila as 830.

  1. These statements, reported in telegram No. 1217, June 5, from the Embassy in China, indicated that China had received only $20,000,000 worth of goods, principally in the form of non-military trucks (893.24 FLC/6–547).
  2. Chinese Vice Minister for Foreign Affairs.
  3. Not printed.