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supplemented by material made available to me from Japanese sources,
through the generous cooperation of General MacArthur. Thereafter,
I visited Chungking, Canton, Formosa, Shanghai, Hankow, Tsingtao,
Tientsin and Peiping and observed economic conditions at firsthand.
In accordance with your instructions, I did not go into Communist-
held territory and I was unable to visit Manchuria because of the
military situation; but what I have seen with my own eyes, added to
extensive data accumulated during the last year and a half in
Washington, has, I believe, given me a clear picture of the Chinese
economy as a whole.
Of the many troubles and difficulties which now beset the
Chinese economy, there are four which, in my judgment, are of crucial
importance. The key to China's economic future lies in the action
TRATIONAL SECORDS
or inaction of the Chinese Government with respect to:
is
1.
Shortage of transportation. China has no real trans-
portation system in the modern sense. Under present conditions,
with Communist and guerrilla troops cutting key railroads,
especially in the North, and with a shortage of rails and rail-
road ties for repairs, China's railroads are more than ever
inadequate. Her air transportation is a minor economic factor.
Meagerness of existing river transportation and highway trucking
facilities have caused fuel and food distribution to fall below
the danger point in many areas. Primarily as a result of the
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"ocrText": "- 6 -\nsupplemented by material made available to me from Japanese sources,\nthrough the generous cooperation of General MacArthur. Thereafter,\nI visited Chungking, Canton, Formosa, Shanghai, Hankow, Tsingtao,\nTientsin and Peiping and observed economic conditions at firsthand.\nIn accordance with your instructions, I did not go into Communist-\nheld territory and I was unable to visit Manchuria because of the\nmilitary situation; but what I have seen with my own eyes, added to\nextensive data accumulated during the last year and a half in\nWashington, has, I believe, given me a clear picture of the Chinese\neconomy as a whole.\nOf the many troubles and difficulties which now beset the\nChinese economy, there are four which, in my judgment, are of crucial\nimportance. The key to China's economic future lies in the action\nTRATIONAL SECORDS\nor inaction of the Chinese Government with respect to:\nis\n1.\nShortage of transportation. China has no real trans-\nportation system in the modern sense. Under present conditions,\nwith Communist and guerrilla troops cutting key railroads,\nespecially in the North, and with a shortage of rails and rail-\nroad ties for repairs, China's railroads are more than ever\ninadequate. Her air transportation is a minor economic factor.\nMeagerness of existing river transportation and highway trucking\nfacilities have caused fuel and food distribution to fall below\nthe danger point in many areas. Primarily as a result of the"
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