NOTES ON STATUS OF INDUSTRIALIZATION

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80-00926A005000010019-7
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 4
• Document Creation Date: December 27, 2016
• Document Release Date: February 11, 2013
• Sequence Number: 19
• Publication Date: April 30, 1952
• Content Type: REPORT

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U.S. Officials Only
CONFIDENTIAL
SECURITY INFORMATION
CENTRAL INTELLIGENCE AGENCY
INFORMATION REPORT
COUNTRY China.
SUBJECT Notes on Status of IndustrieUzation.
DOCUMENT CONTAINS INFORMATION AFFECTING THE NATIONAL DEFENSE
OF THE UNITED STATES. WITHIN THEMEANING OF TITLE IN. SECTIONS 793
AND 794. OF THE O.S. CODE. AS AMENDED. ITS TRANSMISSION OR REVE.
LATION OF ITS CONTENTS TO OR RECEIPT BY AN UNAUTHORIZED PERSON IS
PROHIBITED BY LAW. THE REPRODUCTION Of THIS REPORT IS PROHIBITED.
THIS IS UNEVALUATED INFORMATION
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REPORT
DATE DISTR.34410e0
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NO. OF PAGES 4
NO. OF ENCLS.
SUPP. TO
REPORT NO.
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1. Chinese firms *.xe atle tL f7pply needs for AC and DC =tors, No one would
attempt to build any size motor larger than, 100 KW or 100 HP 4S- there is
to equipment in use to rur alarge size. There is little call for
rotary converters or rotary condensert. All systems in Chin are small,
equipment_which is IL normal usage in. the US is just not called for
in Chita. .5tatic condenser are in vely limited use because of the
difficulty in obtaining s'afficient siI'Ter or aluminum foil. The
A1 xm oil Coc9an.y was fremrly the largest supplier, and, only dom
sourc*. This factory also inadt foil for cigarette packages. ? There are
two document-paper factories; in Shanghai with4., capacity of five to 10
tons each per day. . There is also a paper fa*Acry in H ngthow and one in
Kaishing. These, too, manui*cture Qnly cl:Are ow:anent paper and do not
have facilities for making foil.
2.-
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The largest Chinese -built transformer Is capable of one thousand. KW, however,
the majority of transformers in use art vader two hundred KW? Material is
very scarce and. most of it met be Imported. Ootton-brided copper wire,.
silicon steel sheets? porcelain -InsItlators, and transformer oil are the
important items Nhich, if cJt off from China, would- very eriously cripple
the economy.- Before the Commanists came, Chins imported electrical and 50X1-HUM
EA,chanicAl Avinmotnt l'rnm the- Sk.oda Works in Czechoslovak.ia and from
Germany
Chinese can samutactre 4Y.,004 low -voltage Itfl11ato3s and
The (tiffltnVity, again? is getting insulator 50X1-HUM
oil0
there is no vire cable factory in China.
7
A machinery
manufacturing plant operated by the Natural E sources Commission did build
diesel ,anginej, each cylindex around 50 hP. They -have built machines up
U.S. Officials Only
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SECURITY INFORMATION
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DISTRIBUTION 140, [TATE
,
)1(JARMY
NAVY
FBI
ORB By
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COliFIDEIMAL/U6 OFFICIAL 6 UIli.74mitit.aaua Artz adrunes. m. 4%.
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to 100 HP. There wer ma working sonedules9 the plant pperaterstheriselv
didn't know how many machines were built. There w a a great hortg of
1 Tyor nd materials end work vas performed az each becamt available. The
ShangbalNanking Railmay mad:time Shops made some machine tools. This *hop
at Chang Chow was expanded
hops throughlaut_the_entire area
large shop.
Docks in Shanghai, at the Kailan Mining Company in Tientsin, the Chi Hein
Cement Mill in Chingmantao, the Sha:ngai Cement Company in Shanghai, the
Klan:Van Cement Mill in,NanKng, and the Wang Chi Kiang Cement Mill i.n H
hich *as completed in 1949,
, and all the equipment from smaller
brought in and co r olidated into one
there were machine shops at the IT ngwan
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The quality of imported go'as tr. to
-therefore the importance to Chins's economy of industrial importy,is great.
All industry hes been electrified - flour, dement, cotton ilk nl paper
mills, cigarette f'ct ries, rachine shops and refrigeration plants all de-
pend an sufficLent catmints of' electrical equipment. The country will have
to haTe additicnal eqUipent for txnansion? and if industry ie to continue
t all, a continuous srpply of spare pacts is needed for maintenance. Moet
of the plants are tilier steam o -a and deterior tian Mndb? be-
_grAtml_through_lswraper maintenance
and in snme aree, mare years of Communist occu
parts badly in teed were boiler tUbes, seames tubes
aM high pressure vaivea. The Communist engineers in charge of the plants
an't know hov to fit tubes and in them at extremely high temperatures. At
the !tresent time boiler ttb xi .y.h-ty be obtained from the Western nations.
those manufactured in
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and prObably does,eipp1y warn,1
pared with other industrial nations. In the U39 for instance, we speak in
terms of 10 thousand iteme, whereas f7Aaine the figure would be iP tens.
The dust of producing these iB far greater in China Where la.b is
such a big pro7portion of tle, coat, ProdwAivity iz low because math of the
work i -manual and because ail raw materials mwt be imported. Chinese
tnginetra and technicians ate diligent and t:esponsible and they r,B,P, "rake do"
''eNorarily with almost ,71nything, but', e,;(ontinued draining and misuse equip-
under the Communist have .trung them dry. In 1949-50 the
i'ottanist imported, a great deal of electrical equipment but not in igufil-
zltnt amount to counteract the tremendous lost through pour. maintenanct.
I'ltut equipment is very crude andso'bstittes are used Wherter positae.
BecaAte of serious shortage, steal ia 7,;s.f,A. only in shafts and cylinders
where substitutes just cannot bt cped, Luther is used for the the-
China will not be able tc continue sa an industrial nation -if She (cannot
get alloy steels or produce tbeuthrself. She, does turn out small &kAA,Cit
now but not nearly enough for her requirements. If th Western nations
could agree among thenstivre nct to supply equipment to Communist Gbins
they could in effect put up, their own Curtain and. realLy isolate a4na.
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Czechoslovakia could, 50X1-HUNI
needs are very srmul dome
50 ilicon steel ts tbe 'be 'graft or transfer r sheet metal. Low Mk't MBB
makes it all-impoetant. CTechoslovasia and Germany are the mai saures
of silicon sheets. I have never heard of transformer sheets bei r.-)prted
from Russia? or for that matter, any important itemi
Russia knows how
t present is blg problen.
ufacture it but t portation apact
there are AG hydro en-cooled gnernor bei.rig
built in China. There is 4 ten thousand. HP generator 'brought from ay
in the Shanghai Power Co. pany. if this te not: hydragen-coole6.? then. there
are no such neratcr inChine.
For the electrification of (Aoal tinin
these pointv
S ft haulage xr hoisting
Mine water drainage
Ventilation in nine shaft.
9
is -important tocoicenet
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Ulceration in t,"4e mine
Charging batterits ror portabl,- jtghsa tor miners' lamps
Gener,1. service - ma,,Liteop upply.
The items mcat in continuouge, lemanA art (zast iron ipies. mine boilers
boiler tubes? all of which last oniy two or three years. Condenser tubts?
valves, steal 1,11M9 411 items for waintensmce of mining equipment are im-
portant items. Small flashlight bulbs for the miners' caps and pocets
nd.fans-fOr ventilation art important. Thty may be able to get tungattn
wire for these hulbs from Czechoslovak:La. Ard ,galn, steel. Additional
-lints must bt run for transtatipr. A8 coa1 is taken out Of the iDotr. The
larger mines hale locomotive wrah. require, frequent renewal and. addittom
of rails and canto-The Ewa Nan CsalJr,ie 130 miles north of Nanking la
the largest coal mint in China, IA, is the only source vailable within a
three hundred milt radius of 5nala1.
mine shoud be at,le to p.onute 5000 totw a day? though
machine:1 ocTactty of
00 K4
1 T. 50X1-HUM
power plant ?with
Chinese railways have cot been electrified at! yet. China has not become in-
dustrialized- ufficiently tc, allow for such oJTansion. And only on z.ampara-
tively short rout twean two important CiA,64,, such a from. Shaner-ai. to
Banking and Peiping to Tientin ara the rOaroads doublt-trasked. Water
transportation is ti/.1 te frailroads.
9. In recent years therthave beta no new Imports of mining equipment9
fore the tha present equipwpt -is anywhere from 15 to 20 years nid, Extting
equipment may he either AC DC, which. complicates both operation and
maintenance. The trend of thought amchg thg:i,neers is that new equipment
should be AC with the exception Jft hoist becault of speed con-
trol and, adjustment. There ere no elecLro locomotives for mining operalons
in use in Chin AI1 mir! -Iromotle* art ran on coal. Diesel motors are
not used because diesel. cAl is nt7s scarce.
Chinese engineers fall irto thrtt ,L!..attgor'Ltsg
Those who rt(CeiN'it:d techical tAncatiP, ehroad.
b. Those who are graduates of'zsativt uniT,ensities with expe ?
ps and plants.
te:aCe
c* Those who have hcd. no te-,!chnIcal shoolins., tut have ltarned their trade
by practical experieneze.
Chinese engineers are capsWe of copying dta4r? adjusting factors. iv, des..igs
to meet new requirements, u:-Ing maninz and ther tools available to
whih are mostly of very siw3t Th e volume of prodt4tion is lomMA.
to be small because if tool capncity nted. for rhw me?vialv,
the people i,., liEstry resIlLe clerations 111.111d be :It,.,:.hanimed
but their equipment is AO ttl is ilTyxasible. The adnese )04A37 dODAt
as mach as any people could do ot the materials they, have to work, Oth,
Although many KW hours are Tiroduti, there no increase in el.s.IF.,Tifft ca-
pacity because they don't have f,de ractine it0 Thtr
creasing demand for tiectrial 4-apR...,.:A7 and the engineers art cA7,1-nstay
striving for an incrtase. 7,11t last baa genez,stive tquiment y::;11'111t
to China. eight f five thousand KW each, - of
the Export7Import Bank in One or' are..rL u.J$Lt in coal mints, Hvp
in the Peking Light and Pvii7w,Ir plant, ie 1;,:Ae in the T:5Ieitsin
Power plant.
Immediate prospects for a n%Itstartil 1,..nretta in, production of eletiv:al
machinery are nil. The country sill not be able to turn out Lelnectet-
gintera with suffici*nt mq.fv.rity of judgment for: another ttn years. The
older men in China are for 'bre., etpars( in '.11 health and are not lA tne,
ood to develop facilitieg 1.;,r,teent gcnermnent. If Russia senls,
er.zinera and teenni:Aens? trt.aa,Stry wiLI dtvalp, but at wta? 1:steqjr
wci dep,--,?nd tnt nunter of enineer eom;2,-re
important, their abilities. Than, to:. grow,:t of the electrical tr:A.:Tatry
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is limited by capital, The cost of equipment for a small or moderate-sized
plant may be at high as US$200 per nT. In addition; servicing of equipment,
building of foundations,. and the plant site itself may amount to another
US$100 per Kg. In order to use that Mi a great deal of money has to be
spent in trsnsmission and delivery of the electricity to industry - approxi-
mately an additional US4300. For this reason, growth of electrification of
railroads will be slow - --]about 8% in 10 years. If the present
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government will put money into heavy indys try, the picture would change;
but the National Government neve!: did finance any of this lork. All plants
and improvements had to c ome from the earings of existing olants.
'12* The 'only difficulty that ?cad be experienced in switching from US tn
Russian equipment is the problem of transportation,. Since there is very
little to speal- ot In the -.ay of equipment now in china, the country could
use Russian, C'enman; Engl.; ch. Swedish, American or any other kind of
equipmen0 Ly spebial transformers; eouipment could be utilized in any
area. in Hankow, for instance, both AC and DC currents are in use, and
with conv-rfr-F and frnquency chargers industry is gradually around to
a one curnlitt ystem0 Honever; serious as the transportation situation is,
if Russia wair,t, to tie China to her he will not stop at the difficulties
of building roads or railroads across Siberia and western China. There may
be a. stalemate foz a f,:w months, but nc longer. The Russians have the
ability to get thil c damn without anycne'r; knowing what they are up to
and for this reason the transno:.,ation problem wIll be conquered
if -Russia so desires.
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