A vicious contest for saw mills and teak forests owned by British companies erupted early on, followed by similar disputes over the control of enemy energy and shipping facilities within the country. Other problems were more severe. For a time Germany continued actively purchasing Thai products, but once shipping difficulties became intractable, Japan became Thailand's sole significant trading partner. Similarly, Thailand had to rely on the Japanese for consumer goods previously imported from Europe and the United States, which Japan was increasingly unable to provide as the war wore on. A shortage of commodities quickly developed, with inflation soaring and standards of living dropping. Worse still, the Japanese had aggressively claimed the right to import goods duty-free, significantly reducing Thai government revenues. After the Japanese Army seized Rangoon, British and Chinese troops were forced to withdraw from Burma. On 9 May 1942, the Thai Phayap army crossed the Thai-Burmese border and engaged the Chinese Expeditionary Force. Thais captured many Chinese soldiers, and in 1943 the Phayap Army invasion headed to Xishuangbanna in China, but were driven back by the Chinese nationalist force. The Thai government feared that Phibun might lose popularity. Consequently, the government spokesman decided to lie to its people. Luang Wichit announced the Phayap Army had captured Xishuangbanna. Thailand also oversaw a military occupation over significant sections in a Burma-China border, west of Yunnan. But despite the official territorial achievements, the so-called "Great Thai Kingdom" was a paper tiger. It was faltering as its economy failed to adapt to the conditions of war, natural disaster (floods) and the Thai capital being bombed by the Allies. The Royal Thai Navy contracted the Japanese Kawasaki Shipbuilding Corporation of Kobe and Mitsubishi to construct coastal defence ships and submarines. The following territories of Burma, Laos, Cambodia and Malaya were returned to Thailand during World War II. All these territories were part of Thailand (Siam) before the Western Powers severed them from the Thai hegemony in the late nineteenth century. The Thai army would remain in these territories until the end of the war. Following the fall of the Phibun government in August 1944, the new government of Khuang Aphaiwong communicated to the British government that it renounced all claims to the Shan states and northern Malaya, and that it would immediately cede the territories to Britain. The Churchill government did not accept the Thai overture, and was prepared to retaliate. The Thai army evacuated the two Shan states only in August 1945.