BREAKDOWN LOOMS

Gisborne Herald, Volume LXXIV, Issue 22319, 2 May 1947, Page 5

BREAKDOWN LOOMS

CHINA'S JECONOMY MOUNTING INFLATION COMMODITY PRICES SOAR no a.m.) NEW YORK. May 1. The economic situation in China threatens to break completely out of control again, reports the New York Times' correspondent in Nanking. The main cause of the increasing state of the economic collapse is contined of the economic collapse is continued civil w?r drains the national Budget. The Government has refused to reveal any note issue figures, but it is reliably estimated that inflation is mounting at the rate of 600,000,000,000 Chinese dollars monthly. Military expenditures are consuming most of the amount. Prices of many basic commodities have increased as much as 100 per cent in the last few weeks. The black markets, which were temporarily suppressed by the new economic policing inaugurated in February, are spreading rapidly despite rigid supervision. United States dollars are now selling at up to 30,000 Chinese dollars in the Shanghai black markets, compared with the official exchange rate of 12,000. Commodity prices in January were 12,000 times the pre-war level, but have since increased to 20,000 times the rates ruling in 1937, Little has apparently been done about the phases of the February programme calling for more effective tax collections from the wealthy and mobilising the assets possessed by Chinese citizens abroad which are known to total several hundred million United States dollars.