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Donald Nelson, now Chungking's Mr. Fixit, last week submitted the latest of many recent reports on China (TIME, Jan. 1 et seq.). Salient excerpts from the Nelson* report to President Roosevelt:

"For the first time the Chinese economic war effort is now coordinated. Two members of the staff of the American War Production Board have remained in Chungking to act as my deputies in further advising the Chinese War Production Board on problems of policy and operation. . . .

"An American technical production mission has begun work in China. By arrangement with the Foreign Economic Administration, on my return to China in November I brought with me six American production specialists, five of whom are experts in steel production, one in alcohol production. . . ."

Red Tape Cut. "War production requirements have been financed. The four Chinese Government banks have contracted to lend ten billions [$550,000,000] . . . to the Chinese War Production Board to finance essential production. The urgent need for additional working capital in many Chinese industries also made it necessary that China's Government banks reduce interest rates for war production to a point where management would once more find it possible to borrow capital and borrow it quickly. With the approval of the Generalissimo, I put the issue before the newly appointed Minister of Finance and participated in negotiating among the Chinese War Production Board, the Ministry of Finance and the four Government banks. The bankers agreed to reduce interest rates on loans for war production purposes to less than half the previous customary rate. . . .

"Additional transportation facilities have been allocated in China.

"Shifts were made in the Chinese Cabinet with a view to strengthening the war effort. . . ."

"In addition to the improvement in the military situation, we can look for far-reaching gains on the economic front. . . . By spring of 1945 I expect the rate of China's total war production should be at least double the November rate. . . ."

For the Future. "Growing confidence in the national future will make for greater governmental effectiveness and stability, as will experience gained in war-production planning. . . .

"The success of China's venture in planned war production, if properly followed up through American Government and business channels, will make for close postwar economic relations between China and the United States."

*For other news of Mr. Nelson, see PEOPLE.

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