Shortfalls Abroad

Accompanied by 440 functionaries, diplomats, actors, athletes and jugglers, Red China's Premier Chou En-lai visited neighboring Burma last week to proclaim that "no gift in the world is more precious than people's friendship." Honored as the first recipient of Burma's jade-studded order of the "Supreme Upholder of the Glory of Great Love," Chou was in his most conciliatory mood as he exchanged papers with Burma's Premier U Nu formally ratifying the border treaty that settled the long-festering Sino-Burmese frontier dispute (TIME, Feb. 8, 1960). To seal this new accord, the Supreme Upholder also pledged Burma an interest-free ten-year loan of $85 million.

Burma was reportedly offered more than the $85 million, but kept the size of the loan within limits, largely because U Nu could not be certain that Peking would deliver even what was promised. Aid is made contingent upon "the capabilities of the government of the People's Republic of China." If the Communists' promises cannot be fulfilled, the agreement "may be extended by mutual consultation."

It would not be the first time that Red China had failed to deliver on its expansive promises. Sample failures:

P: Since 1952, Ceylon has been piling up credits in Peking because the Chinese have not been able to make good on a trade agreement that called for the exchange of Chinese rice for Ceylonese rubber.

P: In 1956 the Chinese promised Nepal $13 million worth of aid, one-third in cash, the remainder in industrial equipment ; the cash arrived, but the equipment was never delivered.

P: Three years ago Peking pledged $20 million to Indonesia, but to date-has anted up only half that amount.

P: Grants of $28 million were extended to Cambodia in 1956 and 1958 to build a small iron-and-steel works and textile, plywood, cement and paper mills; only the textile mill and a radio station have been built.

Cf Even delivery to Communist North Viet Nam has lagged. Despairing of ever receiving $320 million promised by the Chinese in 1955, the Vietnamese finally, in 1959 and 1960, turned to Russia for firmer help. In an attempt to save face, Red China has negotiated a new agreement which incorporates the defaulted aid (similar face-saving pacts were recently concluded with Nepal and Cambodia).

Such trade embarrassments, Western experts concede, are the exception and not the rule. On the whole, Red China's aid record is better than its output figures would normally warrant. But they are evidence that Red China's vaunted economy is subject to irregular lapses and shortfalls in the very areas where the Communists are most anxious to impress.

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