693.002/864
The Consul General at Shanghai (Gauss) to the Secretary of State
[Received May 2.]
Sir: I have the honor to report briefly on certain parts of a recent publication of the Inspectorate General of the Chinese Maritime Customs which it is thought may be of interest to the Department. This publication, The Trade of China, 1938, Introductory Survey, was released for publication on March 23, 1939…
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In summary, it is suggested that this Introductory Survey of China’s trade for 1938 provides information from which generalizations may be made regarding the effects of the first full year of hostilities upon the foreign trade of China. It indicates Japan’s steadily increasing power, by the occupation of China’s ports, fixing of its tariffs, detention of its Customs revenues, and control, by means of blockade and other restrictions, of its exports, to exert pressure upon the Chinese Government and to displace the trade of other nations in China. It shows that these measures have already brought about a large increase in Japanese trade, both proportionately and in actual value, and have caused decreases in the trade of each of its important rivals. The report brings out the significant fact that in North China where Japanese control is most complete the benefit to Japanese trade and the damage to the trade of other nations is the greatest. The [Page 390] most disturbing fact brought out, however, is that Japan has caused the United States to suffer the greatest loss of China trade suffered by any country and has succeeded in displacing the United States as the leading nation in China’s trade.
Respectfully yours,