446G.119/4–951
The Secretary of Defense (Marshall) to the Secretary of State
My Dear Mr. Secretary: The questions raised in your letter of March 22, 1951, concerning the existing export policy of the United States towards Hong Kong have been given full and careful consideration within the Department of Defense and have been thoroughly discussed in the Senior Staff of the National Security Council in connection with the Senior Staff’s consideration of the NSC 104 paper, entitled “Report to the National Security Council by the Secretary of State on U.S. Policies and Programs in the Economic Field Which May Affect the War Potential of the Soviet Bloc.”
In the discussions of the Senior Staff it quickly became apparent that the wide divergencies of viewpoint expressed by the Representatives of the several Departments involved could not be resolved in short order, although it appeared that further investigation and discussion might develop some mutually acceptable basis of agreement. Accordingly, in the interest of expediting the consideration by the National Security Council of the balance of the NSC 104 paper, containing numerous important recommendations as to which the Senior Staff succeeded in reaching agreement, it was proposed that the problem relating to trade with Hong Kong be taken out of the NSC 104 paper and made the subject of separate study and recommendations.
The Department of Defense concurs in this course of action in the understanding that the existing policy of restrictions on trade with Hong Kong be continued in effect pending the ultimate determination of the question by the National Security Council.
The Department of Defense is prepared to cooperate fully with the Department of State and the Department of Commerce in the effort to find some acceptable basis for the resolution of this difficult and complicated problem. In this connection, I believe the following observations and considerations are pertinent:
- (1)
- Recognizing the great importance which the United Kingdom attaches to the maintenance and protection of the integrity of Hong [Page 1950] Kong, the Department of Defense is nevertheless reluctant unduly to associate the military position of the Western world in Asia with the retention of Hong Kong which, as your letter points, is in a precarious security position;
- (2)
- The Department of Defense can not accept the proposition suggested in the British Aide-Mémoire forwarded with your letter that the United States, by virtue of its prevailing trade practices, could be held responsible to any substantial degree for the loss of or serious jeopardy to Hong Kong. According to data available in the Department of Defense, the British statements on the influence of the United States restrictions on trade with Hong Kong are greatly exaggerated;
- (3)
- The Department of Defense is seriously concerned over the increasing volume of imports into Communist China from non-Communist nations other than the United States. This trade is providing increasing military assistance to Communist China, and thereby constitutes a direct threat to the security interests of the United States and to the UN forces fighting in Korea. The Department of Defense believes that the United States Government should press other nations for immediate denial of all commodities and services to Communist China which may be used to support military operations. Accordingly, the Department of Defense strongly believes that it is directly in our military interest to persuade other friendly countries to impose economic restrictions, parallel to our own, on all exports to Communist China.
Faithfully yours,