893.34/10–1547
Memorandum by the Chief of the Division of Chinese Affairs (Ringwalt) to the Director of the Office of Far Eastern Affairs (Butterworth)
You will recall that on August 25, 1947 the Department forwarded to the Embassy at Nanking a draft of an “Agreement Between the Government of the United States of America and the Government of the Republic of China Concerning the Transfer of Naval Vessels and Equipment Pursuant to United States Public Law 512—79th Congress of the United States of America”.70 In its telegram no. 2076, October 15, the Embassy reported that the draft is now under study in the Ministry of National Defense in consultation with the U. S. Navy Advisory Group Survey Board.
This morning Captain Hummer, of the Office of the Chief of Naval Operations, called to inform me that the Chinese Government had indicated in the course of the negotiations that it would be prepared to accept these naval vessels only on condition that this Government give the Chinese access to naval ammunition to equip these vessels.
It is my understanding that naval ammunition of the type required by the Chinese Government cannot be procured commercially but can only be obtained from naval ordnance. Captain Hummer tells me that Navy has no surplus ammunition which can be transferred to China and that in order to satisfy Chinese requirements the necessary [Page 979] shells and other explosives would have to be manufactured by the Navy to meet Chinese specifications.
In view of our present directive which precludes transfer of munitions on a government level, this case would seem to require special consideration. In a previous instance when it was understood that the naval vessels transferred under Public Law 512 would be for the use of the Chinese Maritime Customs Preventive Service, the Secretary authorized the transfer of ammunition as well. This case, however, is somewhat different as there is no indication that the vessels now subject to transfer are to be used in the Customs Service. Navy has no strong views in the matter other than a desire to be relieved of the responsibility of maintaining these vessels.
It is recommended that the Navy Department be informed that this Department has no objection to the sale to China of the ammunition in question. We could justify our position on the ground that there is little likelihood at this time of the Chinese Navy participating in the civil war on any substantial scale.71