CAPITAL FLEES T'IEN-CHING; HONG KONG TRANSSHIPS NORTH-SOUTH GOODS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80-00809A000600280890-3
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 2
• Document Creation Date: December 22, 2016
• Document Release Date: September 21, 2011
• Sequence Number: 890
• Publication Date: February 14, 1950
• Content Type: REPORT

Sanitized Copy Approved for Release 2011/09/22 : CIA-RDP80-00809A000600280890-3
COUNTRY
SUBJECT
HOW
PUBLISHED
WHERE
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DATE
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CLASSIFICATION CONFIDENTIAL
CENTRAL INTELLIGENCE AGENCY REPORT
INFORMATION FROM
FOREIGN DOCUMENTS OR RADIO BROADCASTS CD NO.
China
Economic . Trade
Daily newspapers
Hong Kong
3 - 5 Jan 1950
THIS DOCUN[NT CONTAIN! INIORRATION AFFECTING IH[ NATIONAL D[FENSR
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SOURCE
DATE OF
INFORMATION 1950
DATE DIST. Feb 1950
NO. OF PAGES 2
SUPPLEMENT ' TO
REPORT NO.
THIS IS UNEVALUATED INFORMATION
CAPITAL FLEES T'IEN-CHING;
HONG ICONG TRANSSHIPS NORTH-SOUTH GOODS
TRADE RESTRICTIONS REDUCE PROFITS -- Kung-shang Jih-pao, 4 Jan 50
According to reliable reports from T'ierA-ching, businessmen are very pes-
simistic over the present Hong Kong -- Tien-ching trade situation. They say
than, at present, only those having special contacts with highly placed Con,-
munist officials are able to do business. Ps a result of the difficulties
T'it.i-ching capital is ralidly fleeing into Hong Kong with a view to re-invest-
ment.
There in a glut on the Hong Kong market of beans and bean products and
materia meO_ca, which are the best-selling items available from North China,
and whose prices are low. Consequently, importers are taking high losses.
Although shipping industrial ravr ?teriols to TTIe _ch provides a go--d
prof"t, the exchange restrictions 1.nd barter requirements of the North China
authorities reduce these profits to nil. Hence, regular traders are staying
out of the trade.
Those traders who have special connections with the right CCP officials
can carry on because of the ?ollowinm advantages: (1.) no exchange renuirements-
(2) quick action on export-import permits; and (3) local officials at both ends
who permit rapid turnovers. As a result, such traders have secured a monopoly.
It is reported that recently more than a dozen large firms in T'icn-thing
were closed by the authorities, allegedly because they were losing money or,
their cargo shipme.,ts to Hong Kong and were unable to meet their export loan
obligations..
A large number of Tien-thing traders, now in Hong Kung because of their
losses on cargo, apparently do no intend to return to the north.
CLASSIFICATION CONFIDENTIAL
STATE VINe'- NSRB DISTRIBUTION
ARMY D(JAIR I)(] Fa I I I I I 1
I I I I I I
Sanitized Copy Approved for Release 2011/09/22 : CIA-RDP80-00809A000600280890-3
 Sanitized Copy Approved for Release 2011/09/22 : CIA-RDP80-00809A000600280890-3
that the gouds would be shipped to Kuang-chou and not elsewhere. This require-
ment is made necessary by the stipulation of the authorities that goods handled
under- the provisions of the regulations must reach their declared destination
within 140 days. Traders estimate that, under present conditions, 30 days
should usually be enough time fox cargos to reach Kuang-chou from North China.
Traders say that the fact that Hong Kong is a free port makes this pro-
cess advantageous to them. Some northern fires with no representatives in
Kuang-chou have sold their cargos to dealers in Hong Kong under contract
through Hong Kong.
domestic trade between North and South China (including East China) passing
their goods through Hong Kong would not be required to secure export-import
permits, there has been a considerable increase in this sort of cargo passing
Although the reopening of the Kuang-chou--Pei-p'ing rail service will
result in rerouting of some trade, the higher costs of rail transport will
mean that ocean shipping between North and South China will continue to be
indications are that only a partial relaxation of the barter requirements has
taken place.
Tien-ching -- Data from the North China Internal Waterways Transport
Company reveal that the movement of goods on internal waterways during Novem-
ber 1949 amounted to 5,626,521 pounds as,compared with 2,023,121 pounds in
October.
The bulk of the freight carried was grain, ealt, edible oils, matches,
machinery, and pharmaceuticals.
The greater part of the cu go was carried in company boats, the rest in
private 'ooats.
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cnNFTfFM TAL
50X1-HUM
Sanitized Copy Approved for Release 2011/09/22 : CIA-RDP80-00809A000600280890-3