The Ambassador in China (Stuart) to the Secretary of State
[Received February 5.]
Sir: I have the honor to refer to the Department’s telegram no. 1098, November 29, 3 p.m. (1946),18 giving the reactions of the Export-Import Bank of Washington to a Chinese approach for a new line of credit to finance rehabilitation of the Canton–Kowloon–Hankow Railroad and for certain Yellow River bridge projects, discussed in detail in the enclosures to the memorandum of November 26, 1946,19 addressed to General Marshall by Colonel M. S. Carter, General Marshall’s representative in the Department. These enclosures include a copy of a letter dated October 29, 1946, sent to the Chairman of the Eximbank20 by Mr. Clayton, Under Secretary for Economic Affairs; a copy of a letter dated November 9 , 1946, addressed to Mr. Clayton by the Acting Chairman of the Eximbank;21 and a copy of an inter-office memorandum from Mr. Vincent22 dated November 25, 1946.[Page 1034]
In connection with the Chinese approach for a line of credit to finance the rehabilitation of the Canton–Hankow Railroad there is now enclosed a copy of a memorandum on that subject dated January 4, 1947, addressed to General Marshall by the Embassy. This memorandum contains an appraisal of the financial, economic, and general policy considerations involved in the granting of a loan for this purpose.
There is also enclosed a copy of a letter dated October 21, 1946,23 addressed to the Ambassador by Dr. T. V. Soong, President of the Executive Yuan, conveying the request of the Chinese Government for a new cotton loan. The Embassy’s comments on this Chinese request are contained in the enclosed copy of a memorandum of December 31, 1946.
The relative merits of the Chinese requests for the railroad and cotton loans are discussed in the enclosed copy of a memorandum of January 6, 1947, prepared by the Embassy on that subject.
No comments were made by the Embassy in regard to the Chinese approach for a line of credit to finance reconstruction of certain Yellow River bridges, owing to the continued threat of hostilities in the area where the bridges would be built and their possible early destruction by Chinese Communist and/or Chinese National Government forces.
The Embassy has no additional comments to make at this time in regard to the Chinese requests for the railroad and cotton loans, since the means of implementation of our policy in China will be discussed by General Marshall on his arrival in Washington.
Minister-Counselor of Embassy
- Foreign Relations, 1946, vol. x, p. 1026.↩
- Memorandum and enclosures not printed.↩
- William McChesney Martin, Jr.↩
- Herbert E. Gaston.↩
- John Carter Vincent, Director of the Office of Far Eastern Affairs (FE).↩
- Foreign Relations, 1946, vol. x, p. 1014.↩
- Not printed.↩
- This paragraph indicated that it “was the practice of the Export-Import Bank to require from prospective borrowing governments a statement of their foreign exchange assets and obligations, and a forecast of their balance-of-payments position” and that China had not supplied such a statement (Marshall Mission Files, Lot 54–D270).↩
- See Embassy’s telegrams to Department Nos. 2148, December 21, 12 noon, and 2149, December 21, 1 p.m., both 1946. [Footnote in the original; neither telegram printed.]↩
- Department of State, United States Relations With China (Washington, Government Printing Office, 1949), p. 689.↩
- Foreign Relations, 1946, vol. x, p. 1019.↩
- Ibid., p. 1014.↩
- A. Bland Calder and Owen L. Dawson, respectively.↩
- See Department’s telegram No. 493, March 19, 1946, Foreign Relations, 1946, vol. x, p. 967.↩