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10/7/1948 - O.K.Y. Sun; Shanghai; Import-Export Field by Albert Ravenholt

INSTITUTE OF CURRENT WORLD AFFAIRS Boynsion Shanghai China Mr Walter S Rogems Institute Crent World Affaims Fifth Avenue New York N Y Dear Mr Rogers As chairman Shanghai Council Promotion International Trade K Y Sun carries importers exporters An independent businessman inside government common cause With foreign Chinese companies share problems Sun holds Jobs aside spare chairmanship Council He manager Hwa Dah Development Company Inc which exports skins laces ambroideries imports industrial chemicals diesel machine parts operates several small ships Yangtze River He general manager principle owner Hudson Company Ltd consulting engineers engaged than0 factories cotton rubber paper Shanghai Sun years comes fairly wealthy Shanghai family He Chinese direct forceful manner speaks fluent English He studied years Ohiaotung University before first Job publicity department large British Imperial Chemical Industries Ltd While orking British began taking correspondence courses sclentific management He learned import export business workin British John Manners Ltd Chinese General Import Export Corporation Eventually organized Hudson Company cooperation number British engineers Before interfered become consultin eineePs factories lower Yangtze River Postwar difficulties these factories encountered tryin accounts paratively small number factories Hudson Company serves today The Hwa Dah Company incorporated Shanghai October The principle owners include several retired Nationalist generals returned Shanghai after intention investing their holdings productive enterprise Sun Joined because experience import export field He intended resign company firmly established countless government regulations Job Since China shifted trade controlled trade Sun explained And traders government Job Not Chinese firms export business Before exporters foreigners I Sun thinkin about skins Most skins Szechuan Hankow shipped after dried bamboo frames In prewar New York provided steady market lightweight fourth three quarters pounds skins After Sun Hwa Dab Company opened market San Francisco eavier skins which formerly local tanners Hwa Dab began exporting skins after normal season November early December They aIppe skins before goverent regulations inter fered Sun spoke illustration considers regulations enforced nothing about business Chinese exporters required government foreign exchange proceeds sales abroad reimbursed Chinese currency official To prevent exporter signing phony contract officially taking price goods while remaider value banEed account United States Export Import Board Executive Yuan minimum price exports Any which wishes export figure below minimum obtain special permit which practice means Several month Export Impor Board raised minimum heavy skins cents pound FOB Shanghai At price United States dopped about cents pound That margin cover freight insurance exporter profit Te result block shipment about 200000 heavy Shanghai And beginning killing season makes impossible export about million sklns Individually through Council Sun representations government The responsible officials their superiors refused without understandable explanation adjust minimum downwardad thereby permit resumption exports The Sun understand simple fundamentals export business He includes criticism Premier Dr Wen respect Western engineers government experts In efforts develop import trade Sun untered other equally impossible obstacles All Chinese imports clared through Export lmport Board which allocates foreign exchange cover purchases To considered possible importer qualify commodity either imported fixed amount commodity before exclusive agent Shanghai product Sun first difficulty establish relations official willing Directorship called quota department Board which issues permits commodities considered essential government changed times lastt years Each director brought entire staff This often meant import applications filed months previous administration submitted The grant import permits Shanghai firms When director takes office fiends favor The energy recuired motacts appreciated those familiar byways Chinese business Several times spell fairness Board ruled importers particular field given equal allocations A company might result allocated ridiculous dollars importation commodity during given month At other times Board shifted Sun considers equally silly policy handing import permits basis Operatin under these circumstances Sun succeeded during three years since importing about 230000 dollars worth machine parts chemicals ether essential commodities His import margin items percent He unable estimate profit because money result inflation figure His earnings however short expectations import export under present regulations holds little promise siness proposition Sun quarrel government efforts conserve foreign exchange But thinks authorities trying carry policy experience implement He viseed China developed point where western controls applied successfully The Hwa Dah manager careful estimate possibilities Chlna exports which durir months totaled somewhat dollars He convinced export total could increase times workable regulations enacted Because breakdown export trade farmers Hunan Chekiang Provinces cutting trees other crops Feathers abroad collected duction menthol crystals fallen percent Sun present controls encourage exporters become hoarders The value China currency fallen Whenever exchange which exporter reimbursed government sales abroad drops below black market longer possible goods original investment As consequence exporters holdin stocks goods rather chance being caught large paper money doubtful value The August price freezin order export difficult Price ceilings enforced police Shanghai effectively extended countryside where farmers refuse controlled price As alternative tangle present controls Sun puahin adoption calls Link system He overnment remove present impot export regulations Erantin oreig exchange private importers He would limit overnment action speciic types imported trade dependent exports orein exchange cover imports The government oreisn exchange assets conserve basic state purchases China Southeast Asia Sun argues system admits might modification practice strerthen China export position He private Chinese exporters could times abroad market could cover their export losses profits imports To overnment ailed proposals whlch Sun public through letters speech Chamber Commerce articles The Council established further interests traders regulations bein6 issued every So recommendations ignored Sun private opinion action blocked officials Central Bank Export Import Board They their power their friends sometimes themselves freer system trade adopted Like Shari inessmen Sun lookin program China mission ECA firms His firms small taken supervisin engineers projects promised American millions projects announced granted dollars He associated Marsman Company American large minin operations Philippines They negotiating become engineers railways rehabilitated By handlir Chinese their tenders Sun hopes seems bound beccme sirle business opportunity China If American associates should contract Sun would position other small medium sized import firms China They representatives limited number products needed reconstruction which offered competitive prices But afraid excluded ation those projects ECA decides replacement parts The large supervising engineers project speci fications The small firms access those specifications competitive basis So staff ECA given satisfactory answer SIncer_ely A1 avenhol Received New York