Office of the Historian

893.5151/7–1845: Telegram

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

Washington, August 10, 1945—6 p.m.

1235. For Adler from the Secretary of the Treasury. This will confirm your information (ReEmbs 1179 of July 18, 1945) that Treasury had issued, and is still prepared to issue, blanket licenses to interested domestic banks permitting them to effect transfers from a blocked account of any United States citizen or any partnership, association, corporation, etc. located in China which is wholly or substantially owned by United States citizens to a blocked account with a banking institution in the United States of any reputable person located in Free China. The terms of these blanket licenses, however, do not permit the sale in China of U. S. dollar drafts or checks. [Page 1121] The transfers from the seller’s blocked account must be effected only by him and he is required to instruct his bank in the United States, by whatever means he deems desirable, to effect such transfers. In addition, the transfers will be permitted only if they are to be made to the blocked accounts of the persons in China who are the purchasers of the dollars.

For your information, Treasury is prepared to act favorably on an individual case basis on applications for licenses to transfer from the blocked account of any person located in China funds to be paid to persons within the United States for the purpose of financing the purchase within the United States of goods for exportation to China for the account of the person in China whose account is to be debited.

We have received reports that the official rate for remittances from the U. S. to China of CN$20 to US$1 has been changed to CN$500 to US$1 and that this rate applies only to Chinese but not to Americans residing in the United States, who, it is further reported, receive a CN$40 to US$1 rate.

Please verify these reports and reply immediately.11 [Morgenthau.]

Byrnes
  1. In telegram No. 1355, August 14, 3 p.m., the Embassy reported that the official rate for overseas Chinese was 500 to 1 and for Americans, 40 to 1 (893.5151/8–1445).↩