611.9331/10–247: Telegram

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

1371. Chinese proposals satisfactory to Dept basis for beginning discussions. You may tell Central Bank Governor informally Dept studying Chinese proposals (Urtel 2016 Oct 2) in anticipation early discussions here. Meanwhile appreciate any amplification of proposals Emb may be able obtain, particularly re scope of purchases envisaged on ChiGovt account. Would these exclude purchases for Govt owned industrial subsidiaries such as NRC32 subsidiaries?

In this connection, re Urdes 983 Sep 8,33 how far does Emb believe Economic Reform Plan may modify May 7 Regulations of Central Trust, which included buying materials for Govt and buying-selling for price stabilization under trust activities.

Are Chang and Chen proposing reorganize UTC to confine its activities as indicated? If not, how assure that UTC will not conduct trade for private account? In Emb view, what is prospect their informal proposals being accepted by ChiGovt?

Sent Nanking 1371; repeated Shanghai 1926.

  1. National Resources Commission.
  2. Not printed (893.50/9–847); it enclosed a translation of the “Regulations of the Central Trust” promulgated on May 7, and repeated the anticipated impact of the Economic Reform Plan on the operations of the Central Trust as previously reported in despatch No. 966, August 30, p. 1184.