102.1/11–2746: Telegram

The Ambassador in China (Stuart) to the Secretary of State

1977. From Adler to Secretary of Treasury.

1.
Will cable reply on currency shipment as soon as Pei, who is ill, is contacted. (Reference your telegram 1051 of November 2077.)
2.
Reference your telegram 1002, of November 6. Discussed matter with American appointed banks. They informed me that Central Bank gives them only 3340 for Treasury checks and that as settlements of foreign exchange are now made with Central Bank at end of each week they do not cover costs of collection on transactions at this rate. Pei informed me that he would permit Navy to purchase CN dollars with US currency from appointed banks at 3350 plus 5% minus Central Bank charge of 2% for cost of insurance and transportation of currency to the United States, i. e., approximately 3450. He also indicated that he would investigate possibility of reduction of insurance and transportation charges and that benefit of any such reduction would be passed on to Navy. Both National City and Chase assured me they would sell CN dollars to US armed forces either for Treasury checks or US currency at same rate as Central Bank will repurchase from them without any charges, that is at 3340 for Treasury checks and approximately 3450 for US currency, though they would prefer US currency to Treasury checks for reason stated above. Accordingly, having cleared applicability of circular No. 59 with Pei I see no objection to Navy or Army purchasing CN dollars from American appointed banks with US currency. [Adler.]
Stuart
  1. Not printed.