893.00/1–749

Memorandum by the Director of the Office of Far Eastern Affairs ( Butterworth ) to the Acting Secretary of State

Military Situation in China

The deterioration of the Chinese Nationalist military forces which began with the first phases of the Communist autumn offensive in Shantung and Manchuria has continued unabated with the shift in Communist military effort to north and central China.

Since the beginning of the battle for north and central China in November, the National Government has lost approximately 86,000 troops in north China, 230,000 in central China, and has an additional 100,000 besieged and written off southwest of Hsuchow.

Generally speaking, Nationalist units are surrounded, isolated, or so badly weakened that they can do little more than temporarily delay [Page 15] the winning of any Communist military objective. The Communists enjoy a marked numerical superiority in both north and central China.

A tabulation of the manpower losses sustained by Nationalist forces and their present strength and disposition is attached.

[Annex]

Status of Regular Chinese Nationalist Forces as of December 31, 1948

A. Estimate of losses since the beginning of the battle for Hsuchow on November 9, 1948:

Central China—the most capable of the regular units in the area. 230,000
North China—units of General Fu Tso-yi’s command. 86,000
Total losses 316,000

B. Estimate of strength remaining:

Central China—

1. Nanking–Shanghai Defense Area, including 5 inferior armies north of the Yangtze and 9 armies deployed along the Yangtze. 150,000
2. General Tu Yu-ming’s army groups isolated and written off southwest of Hsuchow. 100,000
3. General Pai Chung-hsi’s troops in Hupeh. 50,000
Total in Central China 300,000

North China—

1. General Fu Tso-yi’s command isolated in a number of cities along the Tientsin–Peiping–Suiyuan railroad. 286,000
2. General Yen Hsi-shan’s troops encircled at Taiyuan with sufficient equipment but with food shortages. 120,800
3. Tsingtao forces isolated and incapable of effective offensive action. 51,900
4. Sian Area—inferior troops incapable of affecting the course of operations in north or central China. 176,000
Total in North China 634,700
B[C]. Estimated total strength remaining in all the war areas of China: 934,700