Foreign Relations of the United States, 1949, The Far East: China, Volume IX

611.9331/3–2849: Telegram

The Consul General at Shanghai (Cabot) to the Secretary of State

Shanghai, March 28, 1949—2 p. m.
[Received March 28—3:08 a. m.]

1010. For Treasury for Stuart¹¹ from Parker.¹² From Tientsin-Peiping area Communists are resuming export bristles, furs but by-passing consular functions. Some shipments direct Taku Bar to east coast ports, but others to Hong Kong for reshipment. Embassy and Consulate General here have queried me re customs procedure imports without certified invoices. Policy here based on using every means persuade Communists recognize our Consulate’s functions and as second step continuation trade through established Communist ERC [commercial] channels rather than state trading organ.

Request you discuss with customs what penalty or delaying action they prepared take re these cargos. Recommend even if no direct penalties applicable, cargos be retained in bond on basis questioning invoice declaration quality value and particularly exchange rate applicable Communist currency.

Advise soonest as completely as possible.

Also would appreciate information present thinking on imports US to Communist areas. Hydrocarbon oils,¹³ rubber, etc., now going forward without restriction from Hong Kong. Also information re applicability GATT¹⁴ and other preferential treatment Communist China areas. [Parker.]

Cabot

11. Arthur W. Stuart, Chief of the Far Eastern Division.
12. Paul C. Parker, Acting Treasury Representative in China.
13. For correspondence on American trade policy regarding oil, see pp. 1002 ff.
14. General Agreement on Tariffs and Trade, signed at Geneva, October 30, 1947, Department of State, Treaties and Other International Acts Series No. 1700, or 61 Stat. (pts. 5 and 6). See also Department of State Bulletin, November 30, 1947, p. 1042.