898.243/9–1147: Telegram
The Ambassador in China (Stuart) to the Secretary of State
[Received September 11—11:33 a.m.]
1899. In conversations with General Cheng Kai-min, representing the Generalissimo, he revealed that while the National Government armies are making good progress in Shantung and are generally displaying better morale and fighting qualities elsewhere, they are running desperately short of ammunition. They would like to buy ammunition supplies in the US in order to avoid delays and other abuses. Purchasing would be handled by team of General Pee55 in Washington and General Cheng Kai-min in Nanking. However, according to Cheng Kai-min, China’s foreign exchange position is such that she cannot pay cash and he wondered whether an arrangement could be worked out whereby China could purchase the munitions on account or against an advance, either of which is presumably another name for a loan.
An alternative bruited and urged by Mr. Bullitt56 is the declassification of combat equipment and supplies in the Pacific so that they could be made available to Chinese under Surplus Property Agreement of August 30, 1946. However, Military Attaché57 informs us that Army does not keep munition supplies surplus to its needs on hand; this proposal would not therefore appear to be practicable.
[Page 887]Military Attaché reports that in fact Chinese do not themselves know whether or not they are short of ammunition as they do not have an adequate inventory or supply system, on the basis of which estimates of supplies on hand can be accurately gauged.