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power as it may contribute to our transportation and communication needs is a matter of unlimited significance and possibilities, for we have a very large population and our laborers can be organized to do a great many things which otherwise could be performed only with the aid of steam and gasoline.

Industrialization of the Southwest

Turning now to the industrial field of the reconstruction program, we find that the interior of China, especially the Southwest, is naturally endowed with rich resources of the type which are required on the one hand for domestic manufacture for military or civilian purposes, and on the other hand for export to foreign countries in exchange for materials and products which cannot be obtained at home. Take such basic mineral resources as iron, coal, petroleum, copper, tin, tungsten, lead and zinc; they are all found in our interior provinces. It is meaningless to mention the fabulous size of deposits which have been discovered by geological surveys or which are believed to be in existence. It is, however, indicative of progress that we are producing in the interior nearly one million tons of iron ore and about fifteen million tons of coal a year. Our capacity of production is yet small, but the significant aspects of the situation are that the capacity is increasing rapidly under both Government and private enterprises, and that by a vigilant control of consumption, no serious shortage of these materials has occurred.

There is even gold in the Province of Szechuan and the neighboring districts. There is almost a gold rush in the fashion of the California days, However, as the gold vaults in Kentucky are already full, Washington has agreed to extend to China additional credit of $20,000,000 to be repaid with shipments of tin from the Yunnan mines.

In the Southwest, a number of industrial areas have been opened.