GENERAL CONSIDERATIONS 



United States Administration of Micronesia . -It must be borne 

 in mind that United States control of the ex-mandate is based on 

 military security. Regardless of whether eventual administration 

 is military or civilian, it must be expected that certain areas will 

 not be open to free commercial exploitation. 



Under Naval Government, native welfare is very properly placed 

 ahead of commercial exploitation by outside capital. For the present, 

 private capital may not operate in the area, but if and when this 

 restriction is removed United States firms will still have to comply 

 with protective regulations relating to: 



a. Conservation of natural resources. 



b. Native property rights; there is no "wild" land; foreigners 

 cannot own land. 



c. Established wage scales. 



d. Local customs, laws, taxes. 



Physical limitations to establishment of export fisheries 



Shore facilities . -Insofar as conmercial availability is concerned, 

 the following items are non-existent, and would have to be supplied 

 by the developing company. 



Fresh water on atolls must be made by evaporators. Surface wells 

 are brackish, quantity is small, easily contaminated. High islands 

 have a limited supply of potable water, but no systems of distribution 

 except those serving the military. 



Ice and Cold Storage plants do not exist beyond the needs of the 

 military. 



Power produced by portable gasoline or diesel generators is for 

 use of Military Government agencies, and in any case would not be 

 adequate for commercial needs. Japanese installations were destroyed. 



Sewage and Other Disposal Systems are provided only to military 

 areas. Japanese installations mostly were destroyed. 



Housing is insufficient for the native population. Construction 

 materials are practically non-existent. No local timber above native 

 needs. Japanese construction levelled; some foundations could be used. 



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