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Chinese Government may require for delivery under barter
agreements or as security for loans), should by agreement
between the Commission and the Pekin Syndicate be exported
through the latter as sole agents. Ore which is produced in
Kwangsi has now also in theory come under the terms of this
agreement. Ores produced in Yunnan are exported through the
Fu Tien Bank. In actual fact, however, some one hundred tons
of ore are smuggled every month out of these areas, (which
are still under Chinese control), and find their way to Hongkong
where they are sold in the open market at prices much below
those fixed by the Commission. Permission to smuggle this ore
out from the producing areas is reported to be obtainable on
payment to the local authorities of a sum of under Ch.N.950.00
per picul.
The position with regard to tea is unascertainable beyond
the fact that an unknown but large proportion of the crop (as
in 1938) has been allocated to the Russians under a barter
agreement. During the past year both the Foreign Trade Commis-
sion of the Ministry of Finance and the China National Tea
Corporation (which is under the Ministry of Economics) have
claimed that they are in sole control of the export of tea.
The position at the moment, which has been obscured (though it
may prove to have been simplified) by the transfer of the head
of the Corporation to the post of head of the Commission,
appears to be that the Commission will only be concerned with
such teas as are allocated under the barter agreement while the
Corporation in conjunction with the Central Trust will control
the sale and export of all other tea together with the production,
purchase and transport of all tea in the interior; the Commission
however, assert that they are in sole charge of the transport to
the coast and sale in Hongkong of all tea while the activities
of the Corporation are confined to the production and purchase
of tea in the interior. In April 1939 the position was further
/ complicated
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