SHANGHAI INDUSTRY SINCE THE LIBERATION

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP82-00039R000200020061-1
• Release Decision: RIPPUB
• Original Classification: R
• Document Page Count: 26
• Document Creation Date: December 22, 2016
• Document Release Date: May 15, 2012
• Sequence Number: 61
• Publication Date: May 20, 1952
• Content Type: REPORT

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Chung,-lCU.O Iun.yeh+ Wu Pen-cht8,
Sngaai + 2L1' A~ri1 1950
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%STAT
w ,,'
'?gin
i' ,
.*' t
119.1 t'..~aY
S I ANGHA ' S I DUSTRY AFTER T LIBERATION
Wu pen-ohia
TH COLD tAL CEMACTER OF SE&NG'IAI 's XNDUSTRY.
It has been often said that China's industry is an assemb-
ling (i.e. assembling machinery and machine parts imported from
foreign countries) and f abrioating (i.e. making finished pro
ducts from Imparted semifinished goods) industry. This points
out unmistakably thca oo1oria1 nature of China's tdustry, esm
peo1all Shanghai's industry.. In fact, 1n reoent years Shang
~'
hai,.a large city with more than 10,000 industrial plants and a
population of 3 million, had served as a major outpost of imm
erialsist expaloitationa S.tnoo the later years of the thing
p
Dynasty, Shanghai has been brutally exploited by the 1mperia1 '
fist oountries and their conspirators ? the bureaucratic oap ta1-
fists Due particularly to tha destruction inflicted on the
national industry in Shanghai by the reactionary Kuomintang,
not only were the basic industry materials such as wood pulp for
paper industy, steel alloy for the manufacturing of household
untens`ila, raw rubber for rubber industry, high equality naphthalene
for manufaoturi dye, eto. , dependent on foreign supply; but
agricultural products used as basis industrial materials, such as
wheat for the flour industy, cotton for the tei1e industry, wool
the woolen textile industry, etc., as a aonsequenoe of Insuffi.
for
dent domestic supply as it was in,the ease of wheat and oottaf or?
as a oonsequenoe of. rroneous preference. for foreign goods as It
In the oase of wool and tobacco. All these indioate clearly
oolanial..oharaoter
the
the
inherent weakneaSe3 and the dependence of
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 THIS COLD N:tAL C~IAR CTTR CAF S NC'I t' S INDUSTRY
S ? NGHAi' S INDUSTRY Al T1R T ! ITERATION
Wu Pang. ohia
It has been often aaid that China's industry is an assemb
ling (I.e. asaembling machinery and machine parts imported from
foreign countries) and fabrioating (i.e. making finish:od pro-
ducts from imported semi finished goods) industry. This points
out unmistakably the colonial nature of China's Industry, ?ss
peoially Shanghai's ~ridustry. In faot, t xreoent years Shang
hai, a large oity with more than 10,000 industrial plants and a
population of b million, had served as a major outpost of im.
erialsist expOioitationp Snot h later years of the Ching`
p
Dynasty, Shanghai has been brutally exploited by the 1mperia1w
ist countries and their conspirators
4N~I f 'rl
I4 LW
fists. Due particularly to the destruction inflicted on the
national industry in Shanghai by the reactionary Kuomintang,
not only were the basic industry materials such as wood pulp for
paper industy, steel-alloy for the manufacturing of household
untenslls, raw rubber for rubber industry, high quality naphthalene
for manufacturing dye, eto., dependent on foreign supplyi but
agrioultural products used as baaio industrial materials, such as
,
wheat for the flour industy, ootton for the texti le industry, wool
for the woolen textile industryp eto., as a oonsaquenae of insuffiw
cient domestic supply as it was in the oase of wheat and cotton or
as a consequence of erroneous preference for foreign goods as It
was in the ease of wool and tobacco.; All these indicate clearly the
colonial character, the inherent' weaknesse3: and the - dependence of
the bureaucratic capital-
STAT
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of Shaghai'S industry.
It was for these reasons that Shanghai was )oonfronted with
many difficulties in the period immediately following the liberate
Lion. Rowever, these difficulties oan be overcome, including the
new and many possible difficulties fron internal or external sources,
In fact Shanghai's eoonomy has taken a basic turn for the better
since it survived the most trying months of June and'July of last
year and also the first half of August. It too]c another change to..
ward a new stage of development after the violent price fluotua
t ion in November 1949 and the air attack which ooourred on 6 Febr-
uary 1950. Events of the past 10 months show, that Shanghai's 'in
dustry is now undergoing a basic change from serving the few and
being dependent, on foreign oourrtries to serving the people and being
self..suffioiente
As a matter of fact, the aboveMmentianed'industries which de-
ended on foreign countries for raw materials are now doing what
p
they can to find new sources. For instance, state-owned and private
woolen textile firms have established a joint purchasing organi-
zation to purchase raw materials in the interior oChine; the paper
manufaaturin industry is making experiments on paper pulp production;
the Division of Industry of the East China Government is planning a
paper pulp plant in Chun kung; the, steel company in Anshan has dew
vetoped thin sheet steel to replace ferrous sheet steel-alloy 'for'
the manufacture of household , untensils # the cigarette manufacturers
are now trying to use as much domestic tobacco as possible.. All
these are evidence that after' the liberation, Shaha9. was reborn
~
and has laid new foundations for future' developxxient.
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7N Aiaa c: '
II, FROM RECOVERY TO NEVV DE1T LOPD4ENT
In the battle of 8henghat, beoauee ofhe ewift arr1va11 of
tha people ' s Liberation Army and the proteotion of the, plants by
the brave worker, exoept for the etatea.owned China Textile Company
No 5, whioh was destroyed oompletely when the enemy demolished itai
nearby bridge, and the privately"owed
Fu
Feng-ulung Flour Mill,
which was aleo completely runined, the rest of the tndustrial plants
remained undamaged. The six pubio utility industries. (eleotrio
lightsn, telephone, opal*gas, water supply,. street oar, arid bus)
~
did not suspend eervioe for even a single day. On the very
day
27 May
when Shanghai was liberated, all China Textile Comp'
any's mills resumed operation. Plants formerly belonged to the
National Resouroes Committee also gradually resumed production on
a later date as a result of the Coverrments poioies of Making
over swiftly, aonfisoating carefully, and interfering patiently."
The liberation of Shanghai has enable workers in the state
enterprises to raise their political awareness and has oreated a
new attitude toward their labor; they have developed their en-
thueiaasm for, work and have cultivated their inherent creativeness
Consequently, production efficiency has been increased and economy
realised.. For instanoe, th,e productivity of a spinning mill in a
20~hour period. per spindle in terms of 20's cotton yarn was 0.883
ounda in May 1949 preceding the liberation, but increased to 0.955
p.
pounds in Deoember ,1949, and to 0.983: in January 1950. The pro
~
duotivity of weaving mills also:showed.increases. Ina 20"hour
period and in terms of 12.paund fine. cloth, a weaving mill pro*
du?ed' 58.9 yards i.n May 1941, 88.7 in December
r an. ire
crease of 8. percent [sic ], and 88.7 yarde in f January 1950 or an in'.
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orease of more than 50 pervnt over the preoec1ng xeaord. The
braakin rate deoreased to 4.1 percent, a 50?peroent deoreaae
ppmpaved with the average breaking rate of 8 percent in 1948.
A bale of cotton yarn now requires only .401 oatties of ootton in
eomparisan'with 410 patties In )Iay 1949, showing a saving of 9
patties per bale of yarn. As to volume of praduetion, Shanghai
produced 306,204.3 bolts of ootton olothe, and 16,432,90 bales of
cotton yarns for May 1949; but it produoe'd more than twioe as
muoh as before in January 1960 with 699,435 bolts of sloths and
32,061 bales of cotton yarns.
The steel industry, which almost came to a standstill under
the Kuomintang regime, is new making good progress. Due to the
expansion of transportation faoi1ik e$ and the inoreasing demand
for steel, the steel mills of the 23 public and private steel com?
.
s are rnllin again. Despite the price 'spiral of last NoW
penis
v?mber, more steel mills are operating, while some individual
steel companies are better off than before. An example is the
Shan hai Steel Company, which is owned jointly by state and
g
private investors. Due to the increasing zeal on the part of the
workers and to the democratic management, the first steel plant of
the Shanghai Steel Company. produced more than 1,000 metric tons of
steel from 4 January 1960 to 13 March, or an-torease of
0e U
per
cent over the original target. This also exceeds ' the 'total proms
duation for last year. ( aperated only 4 month's last year.)
The Company's 9?av d plant produoted 603,metriv tans, a 20,6 per
nt over the original target. Its produotion declined in Feb.
ae ,
ruary 1950 due to a lack of power supply resulting from the air
attack. howevor,' its output jumped again in March; by 29aroh
it had produc~bd 664 tans of steel, a 28 percent improvement on t"he:
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LII
original stipulated amount, The Oompany' s third p1arib had an
output of 1,014 tons in January and February as pornpared with the
ori'gtal target oi` 800 tons, It planned to produoe 384 tons in
Mar?hy but its production reached 423 tons by 21 March. Not only
has production shown inoreases in these plants, but their machinery
and equipment have also been expanded. For instanoe a new 2-ton
fur,ae has been added to the Company's first plant, a medium size
steel mill to its second plait, and a large steel mill has been
repaired in its third plant, It is predicted than when these newly
added or renovated 'installations begin operating in June this year
4Th!7 , production Will exceed the highest peak of the past (1940);
steel output will increase 3 tines and cast iron 6 times over pre-
vious periods:
,: The recovery and :re-development of pH irate industry is
attributed to the: governrnent's a11aut support, In other words,
had the government not purohased the finished~produots in the
t
early days of Shanghai's liberation, the long-paralyzed Shanghai
industry would not have reoovered; had the government not en-
couraged the textile mills by rushing cotton supplies to the pro-
duoers and by lifting import duty on ootton, the textile industry
'
of Shanghai, which at that tmy had a stook of cotton only suf-
f oiexrt,for half a months use; would have closed down; had the
g0v0rnment not rapidly restored trapportation and provided batter
oonditions for the circulation of goods, Shanghai's trade would
have been strangled; In short, government support has pit private
industry back to ' normal operation and enabled it to forge ahead;
This is indicated by the inoreasing number of plants :whioh have
resumed operation every month, According to data compiled by the
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H
Jt tt sspC:t~ ~:orz of ak ax~ghc~i ~ axy ~ nG axed Maritifacb~are, the
ibar of rma re~iumin operattOU in peroentage of the total, ' num*
n~~l ., ~
ber of firma in individual industrriob are as fallowe><
I 1~~9
Daeembsr 199
Per c~erxt)
industr
Stc~c~i ~'
Q*4?.4
86.7
M ne tai1d11ag
~.ah3~
2O.O
~J1.4
Elaetri e Equi ant
44.4
79.3
Rubber Industry
38.0
77.5
Blanket and 'owl
31.0 (August)
84.0
House hold utensils
55.0
6000.
79.6
Thermos bottle
14.3
Paper. manufaoturing 510.0
86.1
noxease of industrial. eleatrio ty oonsumption asili;
The monthly i'
indicates that Shanfhai's industry Is raoa'ering and moving ahead.
The Paper nuf aoturtg indu ty .s leading in this re apeot its
pager consumption in September 1949 was b times as great as in May
in November 1949 was 3 times as great as in day 1949.
.1948, and that
This shows that people are now more interested in cultural aotivtti?s.
The a,ahine building industry, which met with many difficulties under
.., m.
the Kuvminn regime, has inoreased its power oonsumpt3.An 3 times
over the previoua period as a result of government support arid purer
...
aota. Power consumption, for other4.ndustries suoh ae
ohaee _aerntr
textile mills, flour, rubber, and others 1nareased 20 to 200 per
,
cent.
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 Declassified in Part -Sanitized Copy Approved for Release 2012/05/15 : CIA RDP82 000398000200020061 1
SxarrcHAi's z~uS~RuL POWER coNsur[Priox, 1949
industry
Cotton Spinning. 17,131,6711
Cloth 6leaving
Paper
Machine
Flour
Wool weavi
Rubber
..Silk
9?getab1e ail
~.... -?.
Cigarette
;331,3}4
517,x45
491,363
943,790
639,Otio
392,558
a'6,~-75
?-a5983o
109,789
(Unit: Watt/hour)
June u1 y August
September
October
18,585,699 15,18lc,l~78 13,090,791 169160'972 71i,137,C}00
2,217,562
1, 047 ,053
523,078
3J8s2o$
Chi;, X00
582,788
260,497
157,6I2
132,870
2,74:179
1,085,254
8,519
1,272s760
622,000
662,665
235,119
292,1I.~9
21,350
2,703,528
2,178,&96
937,71x5
2,612,123
608, 000
b4.9,705
193,320
397,866
21x4,508
3,136,375 2,375
2,799,823
1,029a578
1,920,16
1t
636,000
663,907
207,615
323,58
187,721
000
I,515,Ofl0
1,020,Oi0
1,667,000
582t000
621,000
193,000
9h,O0o
lbr,ooo
November
20a5b7,0tJ0
3,36Lt,oCjO
7-s8tt7,0O0
1,153,000
1,026,00
863,000
766,000
2,:,000
109,000
222,0
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,W:Li A Fo U AT IO o oovi DEELOP
L
baa.a faotors which has suaoessfu .y, Led Shanghd
ona of the
1
dust toward recovery' and de 1opment i+ that the revolutionazl
force has wiped out of China the imperi tste' inC1uenCe, to Camp *
dar capitalism fostered by the impexia1tSts, and cud .sme d
these imperialist and feuda1it elernenta riot beep wiped out,
Shangh 'a industry p'obably oould have barely survived or could'
have mace only limited and uneven progreas. Xn order to describe
how Shanghai's industry' has recovered and iron ita way toward
future development despite a shortage of capital ? and raw materials'
and despite the absence of a strong market demand for industrial
goods and many other difficulties, some concrete illustrations
should be presented
(1) Communist policy with regard to cities has contributed
much toward the rapid recovery of Shanghai's industry. In essence.,
the Communist city regime did not interfere too much 4th the city's
industry. ?. Liu hao'wen, head cif the Light Industry Div.stona,
when he tools over the China Texture Company said the followings
"All participating delegates and employees shall unite as one to
make this industry grow. Henceforth, all employees shall maintain
their former positions and keep the sans salaries. Every employee
wilI from now on `stick to hts job and perform his work contentedly,"
Thua under the polio y cif "taking over swi f tl y1 confiscating
carefully, and interfering patiently", all , industrial plants which
were taken over by the goverment have resumed production rapidly,
( 2) Shanghai ' o industrial recovery is also the result of
loans provided by the People's Bank and support 'given by state
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 Ij
entsrp,aea , _ Aaaarding to statitQs available, the Peopis 'a . Bank
made ica to the etete..awned enterprises amounting to 29Li., 290,000
yuanin Jae 19)4.9; 2, X03, 90, OOO yuaan in July y 3,867,910,000 yuar
p
in August; L,1.SL ? O OOO Yuan In September; 7,332, 7O,.OOO yo*n I rl.
aotober; and 23, 312, 930, 000 Yuan n Novernbcr. Loans ` to they pa~r3?
vatelya*owned induatriaL Firms amounted `to 1 983 SLO,O00 yuan in
June; 7, 237, 980,000 yuar in July; L , 2L O, 8L O, O00 yuuan in Auguat;'
21,8 1,1Lt.O,OOO y'uan in September; 29,191, 90,000 Yuan Ln October;
and 7 , 8S 9O, OOO y uan in November,
The Harm df China made loan tataU3.ng 1,160 DO, O00 yua
in August 1914.9; L,01i, 21O OQD. yuan in September; 7,O3DQO,OOO
yuan in October; and 8,L 3,390 0OO rtxan in November
The Bak of Communications made loans inlovember the
very month it resumed bus nesa, totalling 1.2 billion yuan d
27Q thousand units of eubsistance allowance, In order to render
assistance to the chemical industr~r during 1ta months of de-
pression, the Bank of Communications nnade commodity mortgage
loans to the chercal manufacturing firms 'and purchased their
products. Thus it purchased L 2,OOo barrels of sodium sulphide.
worth 780 mt'lion
worth 18O imi,ll on
ai,
yt~and
ana 21 barrels of ~mrmbnium su,phide
The former is node of.tpeter which
is produced in w?ritar and;pn and mst be sued in eu1ctent
quantities, ,in
order to
keep the p?,t in operation.
_t purahaae of ', r%onium supl.co was r
4ack marked.
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result ' . of `the
From what has been. menbIaned above it is obvi?ua that the
total amount of loans is increasing by the month the total amount
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of :Lo to o a e enterprt$e~ jn: Novembex' . a ..rnee ~;rea' x ~aau
+~
that he tots amount off` 1Q to private busino$s
in ~'u~~~ _ wk~i~e ~ ,
in November L~ ~ tLmay in, excess off' that ih June. These loans
have of ca tai, turnover and taus renders.
increased the rafts ,
neat assistance to ~induetria L production.
While the bank credits; given to pxivate. enterprises have While ~
fac industrial praduobioxr the distribution of raw mateZ.
~..itated and the ai.gnng oe marketing contracts initiated by to stag
als .~.
?ntexp~e have.also contributea a good deal to prod ct any Last
October when prices of imported good went up, the state owned
d to private enterprises a1~cut , 600
c,etribute
importing comparf
hence dowered their production cosh and solved
tons of rubber,
the problem of the r , maters-a1 supply. On the other hand, the
s rketing contrasts between state enterprises ald , pesigning a~ ma
ses has assured pxivate enterprises of a & eac mar-
vate- enterp
ket and stimulated their capital turnovero Thus the state-owned
Sha~ghai Trading Company and the Cotton rare, and Cloth Gompan r
signed a series of marketing contracts respectively with the
'umber 2, S, and 9 p1 ltS ci f the Shen-'hsin Textile compaflY# the
,
Ho feng radin CompaX' the }iengfeng .'darn Company, and the
~ >~ ~
cal Comper'''Processing contracts were also signed
~'ing hs~,n Chem,
between the . Cotton, Zarn, end Cloth Comprl' and some ceing firitia
.
in Shangi from last' September to December the Company signed
d
processing contracts. with I dyeing and weaving firms invoLving
-
he weaving of 208,Lt.hi bo'ts 'of cloth and the dyeing of 106,209
,
boas of cloth. 3eginning in L9 O, more processing contraetS
?wiU be signed; now about 30 firms have signed processing
contracts with state eriterl)risee?
Private banks: in Bhang? have so made Loans to
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..
II'
~aeouragent from the PGaple osw
private enterp~eE8. With ~
Ba, p?vata baxakl.n~ _jnetjtutia b,ave. made 3.ndu~trl loanS lfl
'
~.a~~~~ 'ram the standpoint ~~
~,dd~,tian to making ac~mmerc~.-
them to ~htft ~heix
ivate banks it t~ a healthy re 'oxm for
pr ,
business emphasta f dam cammarO3.81 loans to tndu$tx~.al lnans
It is the bung of a change frvm the re
the ~uomintang Regime toward a recOg??
attitude prevai.lin~ under
nit1an a~ the necessitY of development. '
~ item Of the FQple 'S epub11d,
fact, under the new econOxr3.e Y
p?vate banks must graduallY change their business palicY and
. ,
tivn? Only by so doing can the private
promote industrial praduc
cap mi~$10n `and make SonUe contrlbu~~.?n
banke fulfill their h1st
as do other types a1? acanoTJic anterpxisaB toward the entire
' eCOTI banks ~n shanghai have ~'a~.~.ad such
~'e ~a ~~r private ~~
of lame made ~hanghair~
spend policy as indicated by the types
rat10n? Fats inetanea,
'priva banks sInce the li
percent of the total loan made last
loans constituted 8?
~;r~k, one of the jar banks in hanghal,
,~~~~, by the ~~~s~ang ~
62. percent in September, and 63 ? 6 percent in O(StAb~'. Pex-
cen~.ta,ge ~ that bank' s laans~ among ve~ricaus ~,ndu~distribution distribution of '
tries are as follaw~ ~ Textile 39 p~rcent9 Maur " perceni',
paper mianufacturi2 percent, chemical induStrY 19 percent~
vegetable Q i~ing ~.ndustrY 3 percent, c~.g~re~tte rnanuoil e~c ~rac
nIcataans ane percent, cultural indu.s.?
faeturG L percent, co1flu
n~ yard goods
y' percent, aotta
tries 13 percenta food ~,nduetX 2
and silk goods re ereex~ty department stares ane: percent,
.~..ng ~ p,
others 6 percent. For the . Bank ai
Fruit retai1ing ~ percent, and
r' 4
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ti~a
low canstjtuted 66.23 p~xcea~ ~~
comm:1.a~tatansy ind11
tabe~c ard:7Q percent ii Navem~e~.
~,u~ust~ 7 ~M~ p~raent in Ac ~
I
And far Hs~.nduetrt lc~+~s can8~-itutec~
' ~.n~hna ~~ ~ manthl~ "
7 ~ percent e . the tot+ 1 10 axis on to avez"age ?
What has been statod above is 1irrd,ted to actionS taken
ndiv enterPx~.se$. ln order to ~aavst prom
i~.du~.l~' by private
duct:ian, collective action is of greates~- importance. Hence,
.
a faint argan mn',n ~ ~.eane to f~.nance the purchases
~:~atlAn for ~
or cotton ~Ta9 set up nd was partici ated in by 93 banks, 76
~
loan companiES , and thx ?ee trust Compwni ee. In order to make
f /able to ~.ndustr3.es other than the financial assistance available
r
textile another cofect?ve loan office was set up
.~ndustr~''! last December by private and public banki.ng firms with capital
UndeX? the leadership e1'' the People ' s
totalling 12 bull on yuan.
Bak, this caflective loan office is mobilizing the available
f a develop industries ~hjch are beueficiafinancial resources t to national welfare and people's
Uvelihaad; it has tran5fed
sharttarm sacia1 Thnds into lcang.?term investment. ' 14
licatione; loans were made
February 19~O there were 237 loan app
each approved application. lapplapplication. ?ortynine
in. sip installments for e
firms benefited: by theee ;pans. The Joint Cotton rcha8iflg
De hp greatest nmaunt in leans.. h~.le the Department , received t
the chemial LnduStry received, the second
textile industry and
~t~.~'e
these loans have had a very pa~.
largest amount. Undoubtedly and etimuIating effeet an industrial produetian. They mark the
t s effort to regulate private banking
beginning of the, gvv~rnmen
business of Industrial development. In order
business in . the interest .
effort, this collective ~,aan office has
fully utilize the united ,
Declassified in Part - Sanitized Copy Approved for Release 2012/05/15 : CIA-RDP82-00039R000200020061-1
 f
Declassified in Part - Sanitized Copy Approved for Release 2012/05/15 : CIA-RDP82-00039R000200020061-1
Increased its cap t by 18 bil ton , aflar a total of 3o bi1iion
Other factors such as price etabili ai4on, campaign agaizist
speculators, and the ever expanding market as a result of the
aucaesefut revolution have also helped in the _ recovexy of Shanghai ' a
industry.
M ASUR S TO OQU ERkOT THE N DIFFICULT
ARISING FROM BLOCKADES AND AIR ATTACKS
However, while Shanghai ' s industry is on its way toward
recovery and development, there exist aiong` with favorable
elements which would eventually lead toward ultimate victory,
new difficulties springing up from hidden evil socici forces.
are always bewildered by the surface facts without being
People
able to go deeper for the meaning of the phenorenof~ for bra-
stance when prices jumped up by several hundred percent, a
majority of the owners of industrial plants still maintained
the 8,!11O attitude as before - they valued goods more dearly`'
than money )hcn they e ected prices to rise they not only
w?thhe1d goods from the market, but also harrowed ,heavily to
buy raw materials in huge quantity. Therefore, the goverment
was foxed to
sell cornhod3 tie . revise previous regulations on
avings and loans, reduce intreet rated and take other de-
fletioraa.ry measures. As a rest, prices once again went dorm
and thole who gaxubled on aomm tnod1ties suffered and took the oon~-
sequence . of their speculative 'activities,; for when prices' went
down those who had previously withheld goods from the market
were unable to resell them now even at 'lower prices M Being
Declassified in Part - Sanitized Copy Approved for Release 2012/05/15 : CIA-RDP82-00039R000200020061-1
 11
Declassified in Part - Sanitized Copy Approved for Release 2012/05/15 : CIA-RDP82-00039R000200020061-1
t1Gi~ ;"?
n ad 4th a slo'market, the rOE1*" ~uAre4.
~, ~au~or~ ~~' ~ enu~ ,
fact ~e~c~h pee r~.$8 W98 o '
~pequ~.attc7S~e ' Natr4V then
sin ~owex ~ ~.~ has , aaus~d~ '~ ~'
~,ur~ha ~ ~ds general
spsbu~.at~.v'e buY~.~ reoeded and p qea drape
00di ctual s3~tua,?,an~ In ~~,n,ghai? ,
e~.aGken~da '~h~.e w~~ the ~? .
n'~iox~ ~.anc~d :~~~~~?~~
i,o~, ~,nst:~ncp s the shir'b maaoturin induS'tcxpor
uari'~
too high. gar~aeq
vember because shirt priced wQx
sales in ~n
' cap3~tal and ~o~' athem ra"
ducsxe ware short of working r ~
xt ~xa rats s any percent lower
oduct~?oh ..~ the stc~re?aps~. ~
hzxt ~aroducer~s x 319)?
in October (total number of s
than i
evert worse sr~ pr~.ceS ~'~.uctu~
Curers a~ 1~nitted gaade halt
lac ads a~en~.n~
bsr a` Jn.ttcd go
ated v'io~.ently~ producers of the ni~m ?~br~r a total of
ember was ll less than In Oct, ,
for ~bus~.rieee in Nay' to c~x~.~ 29.6
their total' outpUt amounted
6?~~. producers} ~ and nt below
1 m~anthlY Outputs or perce
d vcle~~ ,~~.ueM
percent of the na~October's.
The cigaratt~ 1ndustrY expsrtonc
Asa in 4cta]~ex, but ar~~.' ~ or
?uat~.an ? ~i~ ~i rase d bu~ln
~ and
ndustrtp s such. as the d~aln~
6 did ~o tn Navamb0x~ Other
` u& 7 ( silk, ~ottafl~ want)y
~raa ving
say a.hc~u~'~~'.S,ce ... all faced a
al'crnlntun wary s procola~.n,
nsacurO, exld finallY e~.thex
in market, felt financtalh1 j
lad g
t or went out a1 busiflOSS.
reduced autp
'orders fax ? goods, the
After airing filed oVernment
ust the steel indu~tx7 and the
ma~hl~e..bu~.ldin~ ~,nd '~
lurk '~~ a bush.?s~~ de~rae*
tad
~,c. indua?bere alb, ca'ra~
`
i an?
Declassified in Part - Sanitized Copy Approved for Release 2012/05/15 : CIA-RDP82-00039R000200020061-1
 Declassified in Part - Sanitized Copy Approved for Release 2012/05/15 : CIA-RDP82-00039R000200020061-1
It, was most unfortunate that before the bueinesS oriaia
was averted, Chiang a American planes waged attacks on Shanghais
- ,
main power plants for a period begtnning 6 February l9o. This
,
turned out to be a heavy blow to industries concentrated in
Shanghai. However, the Chinese Communist Party has always been
.
a party which fears nothing. We believe that the broad masses
of people can salve any difficulty. Thus a movement to cope
with air attarka was begun immediately and spread overyrhere in
Shanghais workers in power plants rushed to repair the damaged
machinery, some of ahem even donated their wages voluntarily to
in order to purchase new machi.nesj business firms,
the companies
government offices and schools all made an effort to reduce
~
powersonsumpLion. To take care of the new situation, the
government made up aPeratian schedules for power plants and
the use of electricity by aeon-industrial users. In
regulated
order to m tah production, some plants of the machi.ne??buiZd
. ~.n
ing electric appliance, chemical, dyeing and weaving, aluminum
tare , textile , steel , paper manufacturing , drug and glass,n-
w ;
dustries supplied themselves with power generators. It was by
,
means. of these efforts that the anti air attack movoment achieved
the third week of ` Februuary the number of operating
some gains. In
spindles was cut from l,1a0,000 to 1?341; yarn from 7,000 to
his bales; and cloth
from
0 ?oo to i,L?P
bolts. Unly Less than.
one tenth of the textile mills remained in operation (Total mills:
from the fourth week of February to the second
Fortunately
week of March more textile firms resumed operation with , to ~+ I~he East
p~3.~6a axe.. be~a.nn~.n~ to m ~ a to ~'une
the whale Salo price index (Jsnu
- China ~'eop~6 ~ s ~' ~ o
193? equals iQQ) was 2~~316 an 6 yarch 199, 8ha.ng y
~6riad a~.vse to ~hine6s ~
ncreas~ of 8, ~ percent o~rer the )~.~ 199 ~a
s 23 32 ; to index for 31 rc~a
"~aar~ s Day, w~ch ~. , stab1e.
apparent deareaae from b ,rchmj
~ ~ ~ ~ ~~ ~ sham a~ n ~.np
.?
6 fvorab1e CO ridit1on for the da1re
price level of fens v ~' uch a
induatXiI partiCU1 rlY in p~ao s s
~.
went ?~ ~ prvs,te
shanghai where specu1at3.v~ cap
etab~.6 p~.oea
the iportance jai having
poasab1a to - r6cogn3.~e ~Tovem~~"
d e s`u1t~.nE~ From the price spiral of last
if the a~~
fludtuate ~ the blockade w1ll
~,s recal1.ed'. Now prices no longer
n if. Taisan' is iibexated; and he 1easant6 ' buying pqW~r
be bra'~e All these
a of theagrar~,9n ref?'8.
U mA
~n~r6a66 , ~a a xea~
w~l b~.e for Shanha~.`te` industrwill be very ~'avo ra ,
Declassified in Part - Sanitized Coy Approved for Release 2012/05/15 : CIA-RDP82-00039R000200020061-1
 Declassified in Part - Sanitized Copy Approved for Release 2012/05/15 : CIA-RDP82-00039R000200020061-1
However, the above object&ves can be realized one with
dt?;Cicu1ty. $ince August 1919, Shanghai has, won tts.' ir8t
battle on the production font. ?ride must i of be allowed to
take us relax; the ` struggle must be Qarried on with greatex
confidence. It must be realized thab birth is paiu1; pain
is r"eit because a now offspring is expec beds It will not be
long before a new peop)o ' e Shanghai wil proudly emerge arid
announce the death of its dependence on ?oreigi imperialism,
and the birth of prosperity, indepOndena$y and freedom for
the pe ople,
Declassified in Part - Sanitized Copy Approved for Release 2012/05/15 : CIA-RDP82-00039R000200020061-1