893.516/6–2349: Telegram
The Minister-Counselor of Embassy in China (Clark) to the Secretary of State
[Received June 2[23?]—10:55 a. m.]
Cantel 637. Following emerges from conversations at Central Bank yesterday.
[Page 791]Generally expected Hsu Kan, Minister Finance, will assume governorship Central Bank as did predecessor S. Y. Liu who already resigned.
Although results Hsu talks with Generalissimo still unknown, conversations indicated consensus he was given at least enough access treasure to accept Ministry Finance post on [in?] Canton. Bank department manager stated no gold has yet started move.
Small undetermined amount Central Bank gold recently sent Chungking for minting. Denominations this as well any Amoy-Taiwan gold eventually coined will be in ounces only, not dollars, in order avoid bimetallism.
First shipment two million silver dollars minted [Philadelphia?] arriving middle July not considered sufficient start contemplated silver program and date of introduction still undecided. GY definitely abandoned with Government and army pay in silver. Minister Finance obviously annoyed recent unilateral action Kwangtung Provincial Bank issuing own subsidiary silver notes contributing to confusing situation once Central Bank notes issued. Public reception Kwangtung notes weak but redemptions apparently faithful [sic] to date.
Central Bank has acquired 1.7 million pieces used Australian silver dollars against payment silver bullion. Entire quantity will be used for army pay.
Vastly accelerated exports latter May continued June explained by relaxation export consignment regulations. Exporters upon surrender 20% (export tax) of expected foreign exchange proceeds from consignments sent abroad (Hong Kong) not required surrender remaining 80% within stipulated time against deposit certificates as heretofore but may retain such exchange abroad without any accounting to Central Bank.
Understand Wellington Koo reopened matter of reverse lend-lease funds (Cantel 523, June 3) in Washington and purportedly was told “settlement could not be considered in cash”. Would appreciate status over-all question as matter repeatedly being brought up here.