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            <text>of the 251 French (700 individuals including the 10 men) are employed by the police and the municipality in our situation, who have gone into the service of the Chinese authorities. The latter pay them what amounts to about 40,000,000 CHR dollars a year. This sum, although very considerable, does not in any way correspond to the cost of living, which has risen 325% in the last 10 months. The Embassy and the Consulate are constantly trying to get salary increases for our compatriots, but so far without any appreciable success. Regretfully and with extreme prudence I felt obliged, beginning 1 January last, to make supplementary payments to them —so — to live. These payments, taken out of the reserve fund set up in view of this situation which the prolongation of the war made inevitable, have exceeded since I say a monthly sum of 2,000,000 CHR dollars, which can only continue to increase. At this rate, it is not difficult to foresee the time when these extra resources will be used up.

6. As the Department can see, our authorities in Shanghai have therefore as their essential task, the assurance, until repatriation, of the existence of the French people who were here only to serve the concession, and who aspire only to reenter France at the first opportunity. To take care of that we have at our disposal 40,000,000 a year which the Chinese Government pays and the reserve fund which the crisis devours at so rapid a rate that I should not be astonished to see it exhausted as early as the beginning of 1945.

I have tried so far to resort as little as possible to financial aid from the State. The department, by granting 1 August last the sums necessary for the service of liquidation, for the consular police, for the College, and for the Ecole Franco-Chinoise; the Ministry of Colonies, by attaching to the occupation (7 corps?) the Tonkinese Supplementary Battalion (which entails expense for the mother country, but an economy in the budget of Indo-China) have reduced by one-third the expenses I meet with our local resources only. Likewise the Government, by according the municipal personnel substantial transfer facilities, has made a gesture greatly appreciated by our compatriots. The retrocession of our concession has, however, involved only a minimum of expenditure for the State, more than largely compensated by the constituting of a considerable real estate (7 fund?).

7. Although the ......?

x Part 6 (not numbered as such) same number
a French: Galisse des oeuvres
b French: supplétif

Inter 27 May 44 (2)
Rec'd 27 May 44
Trans 14 June 44
Rec'd Ottawa June 24th; 1944
File D-5195

Examination Unit, National Research Council, June 24th, 1944.</text>
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