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case in point is the purchase of horses in Sikang in exchange for goods, one item of exchange being felt hats, which the branch has been endeavouring without success to obtain in India.
Another function in the direction, where possible, of foreign and Chinese relief work to areas which are important from the military view point, i.e. relief measures in Kweichow where the of destitute refugees hampers the military effort. This work is at present handled by Major Smith of Production branch, but may be taken over by the Civilian Economy branch, as may cooperation with UNRRA. AND SINNRA.
a)
Production Branch.
This branch works closely with F.E.A., the Nelson Mission, the Chinese WP B. and Chinese Arsenal Adm. Its object is to stimulate Chinese production of items required for the war effort in order to bridge the gap between the total requirements for the war in China and the quantities which can be imported over the Hump and by road. It is naturally concerned with the screening of Chinese demands in the light of real or potential Chinese ability to produce certain items and also with research into Chinese
resources.
This branch wants from us all possible information on Chinese potential and actual production of:
Coal, Coke, Steel,
Munitions,
Liquid Fuels,
Machine Tools,
Food,
Signal Equipment,
in both Free and Cccupied China, What is really wanted is a detailed economic survey of China showing raw materials available and facilities for processing.
A sub section of this branch is concerned with travol in China by non-ilitary allied personnel using American transportation. We are unlikely to deal very frequently with this section but may occasionally be asked to identify British subjects applying for transportation and to indicat. the degree of urgency of their movements. In general G 5 would like any applications put in by B. M. M. to give all possible information on these points and to specify that no British means of transportation is available. This in order to assist in allotting priorities.
8)
Military Government.
As already indicated I was unable to discuss the work of this branch in any detail since Colonel Junge has only just taken over. I will do so later, however, and submit a supplementary report. My preliminary impression is that this branch will probably prove the most important one in G 5 from the view point of the E.L.0. Its activities
are/
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