"There are relatively few Communists" M, Escarra stated. "They seem to be keeping the promises made in the autumn of 1937 and are col-elaborating with the Government. My impression is that they are directing themselves towards a sort of socialism throughout the nation. The former Communist Army, now the 8th Rout: Army, is not directly supplied by the Soviets who send material and munitions to the Central Government.
"There are no Communists in the Government and in the Kuomintang Party, and their activities are being carefully watched over. The Communist danger would be susceptible of reappearing only in the event of a defeat for China."
"The financial situation was satisfactory at the date of my departure. Stocks of gold abroad were heavy. Domestic loans were well received. although the Japanese financial manceuvres in the areas occupied by them are liable to bring about a depreciation: of.the Chinese dollar. Most of the supplies purchased abroad are payed for in-cash."
Text read from the printed page and cleaned; old type leaves the occasional error.