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SECRET (2).

GOVERNMENT HOUSE,

HONG KONG.

17th August, 1939.

Sir,

I have the honour to inform you that in the

early hours of Wednesday, 16th August, 1939, Japanese troops appeared again in Chinese Territory on the

frontier of the New Territories of Hong Kong in the area

extending from Deep Bay on the West to Shum Chun on the railway just beyond the British frontier. The troops, comprising infantry and cavalry, were estimated as

numbering about five hundred and were accompanied by

light artillery. In the course of the morning six Japanese aeroplanes were also observed flying continuously

over Chinese territory in the neighbourhood: they did

not however approach the frontier. The Japanese proceeded to occupy Shum Chun and the district right up to the

Chinese Maritime Customs Station, where the railway

crosses the frontier. It was further reported this

morning, 17th August, 1939, that the Japanese were extending their operations eastwards from Shum Chun and

had occupied another station of the Chinese Maritime

Customs some distance east of Shum Chum in the vicinity

of the road which runs along the eastern half of the

border on the British side.

2. The Japanese on their arrival did not attempt

THE RIGHT HONOURABLE

MALCOLM MACDONALD, M.P., etc., etc., etc.

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