1. The totals of various categories of budgetary expenditures for the period 1950–52 as a whole are (in million yuan):
2. The only exceptions are the years 1954–57 when China was receiving loans and in the meantime amortising the outstanding credits in instalments. Part of the current loan payments were “balanced” by the repayments. However, they are relatively small in size and would not invalidate my argument here.
3. Using the rate of 4 roubles to the dollar and 2·617 yuan to the dollar, which was the official rate since 1957, 5,294 million yuan is converted into 8,092 million roubles. More recently, the figure of 1,816 million new roubles as the total for Soviet loans to China has been repeatedly cited in some Soviet official statements (see New York Times, April 4, 1964 and Kommunist, No. 5, 1964). This figure has been most puzzling to those who do not understand the very complicated exchange rate system in Communist China. The 1,816 million new roubles is nothing but a newly converted figure of the previously reported 8·1 billion old roubles. If one multiplies 1,816 million new roubles by the new dollar-rouble rate of 1.11:1, he will get $2,015 million which, if compared with Li Hsien-nien's figure (5,294 million yuan), gives an exchange rate also at 2·62 yuan to the dollar. Moreover, this new figure in fact strengthens my argument that the U.S. dollar has been used as an accounting unit for all Soviet loans to China. In other words, the sum of the Soviet credits to China was $2,015 million which can be converted either into 8·1 billion old roubles according to the old rouble-dollar rate or into 1,816 million new roubles according to the new rouble-dollar rate. Had all the loans not been connected with dollar accounts at all, the Soviet Union would have used the 10 to 1 conversion rate between old roubles and new roubles. Then, 8·1 billion old roubles is equivalent to 810 million new roubles, or 1,816 million new roubles is equivalent to 18·16 billion old roubles. However, there is a really puzzling element in the information which the Russians have recently released. They mention in Kommunist, No. 5, that this total includes eleven long-term credits. One possible interpretation is that the Korean war loan was made in several separate credit agreements according to the nature of the war expenditures involved and/or that the transfers of the Soviet shares in four Joint Stock Companies were concluded in four separate documents but the official announcement of the transfers combined the four separate transactions.