Mr. MAHON. They will not export these textiles; they will use the textiles to keep body and soul together. Mr. MOYER. Oh, yes. Mr. BUTTERWORTH. If I may volunteer a statement, the impression is that under the arrangement by which the cotton is furnished to Japan for export, repayment has to be made in dollars and therefore the export markets are restricted to those countries that can pay in dollars. It would be the aim of the Chinese who have an excess of mills to import the raw cotton rather than to import the expensive finished commodity. Mr. MAHON. I see. BREAK-DOWN OF COMMODITY PROGRAMS The CHAIRMAN. I would like to have put into the record at this point the table appearing on page 9, leaving out the first two columns and the items not involved in your proposal. (The table referred to is as follows:) The CHAIRMAN. We will insert the table on cereals appearing on page 11. (The table referred to is as follows:) Aid program COMMODITY PROGRAM JUSTIFICATION CEREALS It is proposed that $85,000,000 be spent for the purchase of 193,000 tons of wheat, or its equivalent in flour, and 282,000 tons of rice. About one-half of the wheat and one-third of the rice would be procured in the United States. The remainder should be available from China's customary sources of supply. The quantities under consideration are well below China's anticipated allocations of grain from the International Emergency Food Committee. The CHAIRMAN. We will insert the first paragraph at the top of page 13, on cotton. (The paragraph referred to is as follows:) Aid program COTTON The $72,500,000 in the Chinese aid program earmarked for cotton, would provide approximately 370,000 bales. The price is computed as $195.85 per bale c. i. f. Shanghai, based on United States prices as of April 1, 1948. PETROLEUM The CHAIRMAN. We will insert page 16 with the footnote. (The table referred to is as follows:) TABLE I.-Estimated total quantity and cost of Chinese petroleum requirements for civilian consumption, Apr. 1, 1948-Mar. 30, 1949 1 Products with a value of approximately $14,000,000 will be paid for by sterling. It is difficult to arrive at cost figures for a program during a period when products and transportation are short worldwide and there is a constant pressure from many sources to move all costs upward. The prices used are April 1, 1948, market quotations for products and transportation. The cost per barrel for products and for transportation are shown in table II. FERTILIZERS The CHAIRMAN. We will insert the table at the bottom of page 19 and the top of page 20, dealing with fertilizers. (The table referred to is as follows:) Aid program FERTILIZERS A total of $24,000,000 is proposed for imported fertilizers for China for the period April 1, 1948, to March 31, 1949, approximately 75 percent for nitrogenous and 25 percent for phosphatic fertilizers. In terms of the plant-food elements, this program would cover the procurement of fertilizers containing 42,100 short tons of nitrogen and approximately 20,000 tons of P2O5. Nitrogenous fertilizer programed Apr. 1, 1948–Mar. 31, 1949 These quantities are estimates based on 1947-48 IEFC recommended allocations. The CHAIRMAN. We will insert page 21 and the first line on page 22, dealing with tobacco. (The pages referred to are as follows:) Aid program TOBACCO It is proposed to finance delivery of 30,500,000 pounds of United States tobacco to cost $10,000,000, as follows: Tobacco is an essential part of the Chinese economy. Cigarette manufacture has developed into the second most important manufacturing industry of China. Supplies of United States leaf to supplement and complement native leaf are needed to make possible maximum output. Since employment in cigarette manufacturing and distribution is important in China's domestic economy-approxi mately 10 percent of industrial workers in Shanghai are so employed-imports of tobacco are of considerable significance to the laboring force in industrial cities. Cigarette-tax revenue is the third most important source of Chinese Government revenue, and hence the maximum manufacture and sale of cigarettes aids in stabilizing the Government's fiscal position by providing revenue from this customary and highly important source. CAPITAL EQUIPMENT The CHAIRMAN. We will insert page 23. (The table referred to is as follows:) REPLACEMENT ARTICLES FOR EXISTING CAPITAL EQUIPMENT Aid program It is proposed that $20,000,000 be allocated for the procurement of replacement articles for existing capital equipment. Based upon expected availabilities in the United States and the pattern of 1947 imports of this kind of equipment into China, a suggested distribution of expenditure of this sum is given below: The CHAIRMAN. What about administrative expenses? Mr. CAWLEY. I have a schedule which may supplement the material here, which is similar to the one that we used in connection with other ECA expenses. You might want it inserted in the record. The CHAIRMAN. We will insert it in the record, and immediately following it we will insert the green sheets. (The matter referred to is as follows:) Economic Cooperation Administration, China aid-Budget summary for administrative expenses 05 200 Remarks Average salary of $5,670, less 6 lapse. 2 China trips for each of 5 executives, at $1,000 per trip; plus 2 regular per annum travelers at $1,500 each. Average cost of $2 per person per year. Based on average cost of $195 per person per year. Space rental at $6 per person per year. Standard forms, etc. $14 per person; $504 internal use printing at $54 per person, $1,944; $3,552 for special printing. Average of $50 per person. Basic office set-up calculated at $690 per person. No provision for special equipment. Messengers, janitors, and chauffeurs. 122 732, 880 Average salary of $6,000. 135 assignments and replacements at an average of $1,447, $195,360; 10 round trips United States-China, $17,474; travel 135 shipments of household and personal effects averaging $1,878 each, $253,489; shipment of supplies and equipment, |