ECONOMIC CRISIS IN CHINA

Press, Volume LXXXIII, Issue 25181, 12 May 1947, Page 7

ECONOMIC CRISIS IN CHINA

Shanghai Strikers Given Increases NEW DEMANDS TO GOVERNMENT (N.Z. Press Association—Copyright) (Rec. 10 p.m.) NEW YORK. May 10. “The Chinese Government to-day bowed to the demands of the striking Shanghai workers, granting pay increases in proportion to rises in the cost of living index,” says the “New York Times” correspondent in Nanking. “This, coupled with the decision made yesterday to increase soldiers* and civil servants’ salaries, means that the Government has virtually abandoned one of the basic aspects of the February emergency legislation which aimed at bringing the economic crisis under control. It was decided then to keep wages frozen at the January level, but the present move again links salaries to the living costs index. “The Government has failed in its attempt to break the vicious circle leading to even greater inflation. This will now be given added momentum by a larger Government payroll. “Meanwhile, attacks on rice shops by hungry mobs are occurring in 12 cities in the Yangtse valley, and officials say that conditions will be more critical in the Government-held areas before the next rice harvest.” An investigation of the private property holding of leading Chinese officials, including Marshal Chiang Kaishek and the Soong family, is among demands by the Federation of Industrial and Utility Workers whoso 800.000 members in Shanghai threaten to strike on Monday. The federation’s manifesto declared: “We are not Communists, but workers demanding fair treatment. We are willing to play our part in reconstruction, but we refuse to be made to suffer from the greed of a handful of political leaders.” The federation sought pay increases and a reduction of the Nationalist Army to 1,000.000 within nine months. The “New York Times" correspondent in Shanghai says: “There is a widespread feeling in Shanghai that, pressed by the steadily worsening economic conditions, the slow progress of the anti-Communist military campaign, and the social and political disintegration almost everywhere in Govern-ment-controlled areas, the Government may be compelled to renew its efforts to negotiate a peace .with the Communists. “The galloping pace of economic disruption is nowhere more evident than in Shanghai, where the cost of rice has risen 500 per cent, since January. Daily attacks on rice shops reflect the food stringency and the ugly temper of the people. “Speculation, black marketing, and racketeering are flourishing, while corruption is rampant An American banker in Shanghai said he believed that nothing short of the dumping of 2,000.000.000 to 3,000,000,000 dollar’ worth of commodities into China could slow down the inflationary trend.”