Telegram from Walter McConaughy to Secretary of State Dean Acheson

117925 INCOMING TELEGRAM Department of State TELEGRAPH BRANCH 1/10/51, 3 a.m. N RESTRICTED 5 CORRECTED COPY Action Control: 2765 FE Rec'd: January 8, 1951 FROM: Hong Kong 3:05 a.m. Info E TO: Secretary of State P DECLASSIFIED L NO: 1775, January 7, 11 a.m. OLI tharity E.O. 10501 CIA PRIORITY ARMY DCL DS Re DEPTEL 1876 January 3 following is data resume official DCR Chinese Communist reaction to US embargo and asset freeze taken from NCNA news, sketchy information local press, businessmen's experiences reported CONGEN: 1. Chinese Communist regime assumed direct control foreign trade from regional groups Canton, Foochow, Shanghai, Hankow, Tientsin, Tsingtao, Kunming, December 5; ordered census foreign nationals, December 6; banned sale ships, December 7. 2. Tientsin banned all exports to US, ordered all export contracts cancelled and partly loaded cargoes removed from vessels destined US, December 15. 3. Chinese Communists ordered export duties bristles 30 percent, ground nuts 15 percent, peanut oil, wood oil 10 percent, December 15 (MYDESP 841 December 16). 4. Local Chinese banks under control Bank China suspended issuance letters credit outward bills US dollars covering Chinese goods, December 15. 5. Tientsin banned exports peanuts, sausage casings, linseed cakes, castor beans to all countries, December 15. 6. Chinese Communists banned imports from Japan, December 15. 7. Canton and Hankow stopped exports tung oil, December 18. 8. Bank China Shanghai suspended transactions US dollars, Canadian dollars and Philippine pesos, December 19. 9. South China suspended (A) import licenses transactions financed self-provided exchange, (B) export licenses tea seed oil, cassia, gallnuts, bristles, ramie, December 19. 10. All -60 RESTRICTED REPRODUCTION OF THIS MESSAGE IS PROHIBITED