893.24/2–2648

Memorandum of Conversation, by the Chief of the Division of Chinese Affairs (Ringwalt)

Participants: Dr. Shao-Hwa Tan, Minister, Chinese Embassy
Mr. Butterworth, FE
Mr. Ringwalt, CA

Dr. Tan called at Mr. Butterworth’s office at four o’clock this afternoon by appointment to discuss a number of problems of mutual interest and took the occasion to review the recent efforts of the Chinese Government to obtain munitions in this country.

Dr. Tan referred to the two detailed memoranda of November 4, 1947 and December 23, 194753 which his Embassy had sent to the Department outlining the needs of the Chinese Government for arms and munitions. He said that it was his understanding that copies of these memoranda had been sent to the Department of the Army.

Dr. Tan expressed gratification that since the presentation of the above memoranda considerable progress had been made. He referred specifically to the signing of the contracts in connection with the 8⅓ Group Program, the purchase of the 150 C–46 aircraft and the ammunition deal at Saipan. Notwithstanding the completion of these contracts, however, Dr. Tan expressed the opinion that in certain respects the efforts of the Chinese Government to obtain munitions were being frustrated by unnecessarily protracted negotiations. He referred in particular to the Olin Industries deal, the contract for which had been signed on December 9, 1947, but in view of its complicated nature had not been finally cleared until 4:00 p.m. on February 25, 1948. [Page 23] He also brought up the question of the combat aircraft still due under the 8⅓ Group Program and the delay in the transfer of the aircraft engine overhaul plant in Hawaii. With respect to the former he pointed out that there was a considerable difference of opinion between the Chinese Air Force, the United States Army Air Force in Washington, and the Army Advisory Group as to the number of aircraft still to be transferred under the Program. He said that the Department of the Air Force had agreed to explore the possibility of obtaining surplus aircraft for this Program from the Pacific.

With regard to the aircraft engine overhaul plant, Dr. Tan stated that his Government was particularly anxious to obtain this equipment but that final negotiations have not yet been completed for its shipment to China. He said that in the past it had been found helpful for the various representatives concerned of the Armed Forces, the Department of State and the Chinese Government to confer together and he recommended that in order to expedite action similar conferences be held on outstanding questions.

Mr. Butterworth replied that with respect to conclusion of contracts for the purchase of munitions the Chinese representatives themselves should shoulder a certain responsibility. He pointed out that whereas the ban on export licenses of ammunition destined for China had been lifted in May 1947 it was not until after he had spoken to General Pee54 in September that the Chinese had displayed any interest in the purchase of arms in this country.

With respect to the memoranda submitted by the Chinese Embassy on their need for munitions Mr. Butterworth said that we had requested the Department of the Army to investigate thoroughly the problem of surplus munitions which might be made available for transfer to the Chinese Government and that he hoped to communicate with the Chinese Embassy shortly in regard to this matter.

With regard to the discrepancy in the number of planes due for transfer to China under the 8⅓ Group Program, Mr. Butterworth suggested that these were factual matters which the various agencies concerned should be able to work out satisfactorily.

Mr. Butterworth said that the Department would be glad to call meetings of representatives of the agencies concerned with transfer of munitions to China whenever it was likely such meetings would serve a useful purpose.

Mr. Ringwalt informed Dr. Tan that he had been advised by the Department of the Air Force that there were no combat aircraft in the Pacific surplus to the needs of our armed forces, and that any aircraft to be delivered under the 8⅓ Group Program would therefore have to [Page 24] come from the United States. He said that he had been informed that because of prior commitments, lack of competent personnel, and the inevitable deterioration of aircraft in storage, it was the view of the Air Force that the combat aircraft could not be delivered before six to eight months. He volunteered that he was recommending to the Department of the Air Force that an equivalent number of combat aircraft be substituted for the bombers which were called for in the 8⅓ Group Program but which were in short supply and therefore unavailable.

With respect to the shipment of the aircraft engine overhaul plant, Mr. Ringwalt explained that according to Colonel Kingman, Military Programs Field Commissioner, FLC, final arrangements had been held up pending the receipt of an estimate by the authorities concerned in Hawaii as to the cost of moving the equipment to the dock at Honolulu. He said that he had just received information from Colonel Kingman to the effect that this estimate had now reached Washington and that instead of the customary 15 percent procurement cost deposit required of purchasers of surplus property, in this instance the Chinese Government would be required to pay only about 6.24%. Mr. Ringwalt stated that it was his understanding that final, arrangements could now be completed.

A[rthur] R. R[ingwalt]
  1. Foreign Relations, 1947, vol. vii, pp. 913 and 934, respectively.
  2. Brig. Gen. Peter T. K. Pee, Chinese Military Attaché.