Evening star., 1932-02-04
SHORT WAR SEEN
IF PEACE FAILS
China Lacks Raw Materials
for Munitions and Japan
Has Little Gold.

China's lack of raw material for the
manufacture of munitions and Japan's S
low gold stock will bring hostilities at
Shanghai and other points to close
within one month should peace pro-
posals fall through, according to opin-
ions expressed today In well informed
Government circles here.
1t was pointed out that China has no
facilities for the manufacture of steel,
and that the finished material now on
hand is limited. There are no first
class steel manufacturing plants
throughout China, and the blast fur
naces scattered throughout the republic
are not only antiquated, but can be used
only for the manufacture of pig iron.
In event of blockade at Shanghai
by Japan, together with Japan in con-
troll of all railways in Manchuria, China
would be shut off from its outside steel
resources, it was said.
Japan Controls Mines.
While China has supplied Japan with
iron for years, all of the important
mines, both in China and Manchuria,
are now controlled by Japanese. In
the past the republics chief source of
munition supplies came from its huge
arsenal at Mukden. This plant was
seized by the japanese September 18
last and its 5000 employees thrown out
Of work.
Other and small munition plants in
Manchuria also have fallen into hands
of the japanese.
On the other hand, Japan has ample
raw material to carry on an extensive
invasion, but doubt was expressed here
in governmental circles as to whether
its finances would permit an expedi-
tionary force of any size to remain in
Chinese territory for any length Of time.
On January 80 Japan's gold reserves
were quoted here as being 1921, $3.50, 900.
Meantime, from sources outside of the
Government, it was learned today that
American direct investments in China,
as distinct from holdings in the United
States of Chinese bonds, amounted to
s129, ,768, 900, of which S10,22l 900 Is In
American branch manufacturing estab-
lishments.
Shanghai Is Center.
About 65 per cent Of all direct invest
ments by Americans in China are con-
centrated in Shanghai, where practi-
cally all American firms, representing
all phases OF international
trade, have central offices.
$50, the following represent the most
important for China as a whole, and
the majority of these have central offices
in Shanghai:
American Asiatic Underwriters, Inc,
U. S. A; American Banknote Co.;
American Express Co.. American Con-
struction Co., Inc, U. S. A; American
Machine & Foundry Co.; American
Trading Co.: Anderson, Meyer & Co,
Ltd; Arkell & Douglas, Inc; Asia Lille
Insurance Co., Inc, U. S. A; Betting 81
Leather Products Association, Inc;
Bolton Bristle Co.; China 81 Japan
Trading Co, Ltd; Connell Brothers
Co, Inc; Dodge & Seymour (China),
Ltd. The Robert Dollar Co.; E. l. du
Pont De Nemours &, Co, Inc; Eastman
Kodak Co; Equitable Eastern Banking
Corporation; Paul I. Fagen & Co.;
Getz Brothers & Co.; Gilmore United
Petroleum Co.; Goodyear Tire & Rub
sock e. Check Co.; Herzberg g-Peacock
Enterprises, Inc, U. S. A.. H. S. Honigs-
berg g. Co., Inc, U. S. A; Kellogg
Switchboard Supply Co.; Robert Lang,
Inc, U. S. A; Liggett & Myers Tobacco
Co. (China), Ltd; Ely Lilly & Co.;
Marshall Field & Co.; Raven Trust Co.,
Inc, U. S. A.; Charles A. Schieren Co.;
Shanghai Building Co., Inc, U. S. A.;
Silk Association of America; Simmons
Co. China Division); Singer Sewing
Machine Co.; United States Rubber
Export Co.; Vacuum Oil Co.; John
Wannamaker Co.; Wolworth Interna-
tional Co.; Yangtze Rapid Steamship
Co., Inc, U. S. A; American 1nterna-
ton Underwater, Inc, U. S. A.; Amert-
can Oriental Banking Corporation; Asia
Fire g. Marine Underwriters, Inc, U.
S. A.; China Electric Co., Inc; China
General Edison Co., Inc; China Motors,
Inc, U. S. A; Shanghai Evening Post;
Ford Motor Co. Exports, Inc; Fox
Film Corporation; General Motors
Japan, Inc; National City Bank
of New York; Aluminium, Ltd; Col
observation-disclosures Co.; Henry w.
Peabody g. Co.; Parke, Davis & Co.;
Standard Oil Co. of New York; The
Tex.- Co.; Baldwin Locomotive Works;
Harvester Co., and Pacific
Orient Co.
In addition to these, the American 81
Foreign Power Co. controls the Shang-
hal Power Co., the electric light and
power plant of the International Settle
ment, while the International Telephone
g. Telegraph Co. controls the Shanghai
Telephone Co. .--..--- -