893.48/6–1247: Telegram

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

738. Discussions here to date indicate that target for US relief program for China should be approximating $30 million. While Emb should not disclose exact figure, it may find it necessary to discourage Chinese officials from planning program based on expectations of greater assistance. Total availability US funds prevents supplying full needs originally estimated by Dept for all countries.

Commodities would consist principally of food items, i. e., wheat and rice, with possibly some medical supplies. Chinese officials should be informed that US program will probably not result in substantial increased supplies of commoditites under international allocation.

Dept in complete accord Emb position re desirability maximum utilization voluntary agencies per Embtel 1275 para 3, and need for Emb assume dominant position in directing participation these groups. While recognizing basis Chinese proposal combine post-UNRRA relief with government scheme controlled distribution and rationing, Dept believes relatively small amount of relief available requires maximum efficiency [in] distribution to most needy and that utilization of voluntary agencies in program correlated with but independent of government action might be most effective way of distributing substantial part of US assistance. Emb may wish point out to Chinese authorities that such a program would be in accordance with established tradition US assistance to China and would bring into service people with long experience this field. There is also important factor Congressional and public opinion which has been critical of results past US relief expenditures and which might not understand failure to make use of agencies which have proven [Page 1317] competence and which have confidence of US public as demonstrated past generous contributions.

Bearing in mind general objectives of (a) having relief distributed where most needed (b) using most efficient methods of distribution (c) avoiding dissipation of relatively small relief program, Dept would like Emb’s comments accompanied if possible by tentative plan as to extent voluntary agencies can profitably be used. In this connection Dept wishes Emb explore possibility United Service’s participation. Lennig Sweet38 has informally indicated willingness cooperate and expressed opinion they could handle $5 to $10 million program.

Dept in accord Emb view necessity eliminate Chinese proposals for continuation uncompleted CNRRA projects (Embtel 1276 June 12 para 2c). Dept also opposed to sales U. S. supplies in urban areas as means financing distribution relief supplies in interior. It is believed here relatively small size of program requires reasonable concentration of distribution in order to obtain greatest benefit. If Emb considers it expedient, however, Dept would not object to sale of some quantities of relief supplies in urban coastal centers as means of providing token aid for controlled distribution and rationing plans.

Dept of opinion Chinese Govt should assume inland transportation costs [of] distribution U. S. supplies.

Emb should make clear to Chinese that there is no basis for assuming that Congress will authorize a subsequent relief program.

Dept would welcome Emb comments above program. In this connection Dept notes Emb’s clear understanding problem and fact it thinking along same lines as Dept. Please inform Dept your estimate when program could be formulated and actually commenced.

You may inform Chinese that U. S. agencies will be responsible for all procurement and shipping from U. S. To extent rice is procured in Siam procurement and shipping would have to be arranged by Chinese Govt under plans approved by us. Telegram on this point will follow.

[Here follows a discussion of staff recruitment matters.]

Sent Nanking as Depts 738 repeated Shanghai as Depts 1009.

  1. Program Director, United Service to China, Inc.