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Szechuan and the expulsion of Sun Yat-sen from Canton, the overthrow of Tang Ch'i-yao in Yunnan and of the Anfu leader, General Lu Yung-hsiang, in Chekiang, and finally, after most of the provinces have been thus dominated, an attack in force on Chang Tso-lin in Manchuria this summer. Tsao Kun is to become President, and be and Wu Pei-fu are then to proceed to the reorganisation of a unified China. It is of course notoriously difficult to forecast events in this country, but one cannot help feeling doubts as to the ability of Wu Pei-fu to succeed where Yuan Shih-kai failed. Perhaps the former, if checked in his plans at Canton, will abandon the attempt to unify the country by force, but for the moment at any rate all schemes for peaceful reunification appear to be relegated to the background, and we are faced with the prospect of continued turmoil and internal warfare throughout the country.

7. In the meantime local rumours of the impending resumption of civil war in North China between Chihli and Manchuria continue to be prevalent, and certain movements of troops on both sides of the frontier between the Metropolitean Province and Manchuria have given colour to these rumours, Wu Pei-fu himself, however, denies any intention of attacking Chang Tso-lin as long as the latter remains within his own dominions, and he spoke in this sense to the military attaché during a visit which the latter recently paid to Loyang. A copy of Colonel Orpen-Palmer's report on this visit is attached to this despatch. As for Chang Tso-lin, he also denies any aggressive intentions, but professes to have conclusive proof that he is about to be attacked by Wu Pei-fu. I have the honour in this connection to enclose copy of a despatch (enclosure No. 3) from His Majesty's consul-general at Mukden, reporting on a conversation which he had with Marshal Chang on the subject of the Peking- Mukden Railway, in which the latter expressed himself in the above sense.

8. In paragraph 9 of my despatch above referred to I mentioned the application, made to this Legation by the Wai-chiao Pu on behalf of Wu Pei-fu for permission for certain ships of the Chinese fleet now in Canton waters to refit at Hong Kong with a view to coming North. A curious development, indicative of the political plottings and counter-plottings which are now going on all over China, occurred in connection with this matter soon after, when the Minister of the Navy conveyed to me a secret message urging that permission for the ships to refit be refused on the grounds that the application had been made against the wishes of the nominally responsible Department, the Ministry of the Navy, and that no matter what guarantees were given, the vessels would after their refit be employed in the further- ance of Wu Pei-fu's military plans. A similar message was also delivered by Admiral Tu, the nominal Commander-in-chief of the Chinese navy, to His Majesty's consul-general at Nanking. I accordingly advised his Excellency the Governor of Hong Kong by telegram that, in view of the above and the strong opposition to the proposal shown by Sun Yat-sen (who had been sounded indirectly on the proposal) the matter had better be dropped, and received in due course his Excellency's reply expressing the hope that it might be possible to induce the Chinese Government to withdraw their application, which would otherwise have to be refused. The fact that hostilities had in the meantime broken out in the South afforded a suitable pretext for regarding the matter as closed, and I accordingly caused a private message to that effect to be conveved to the Vice-Minister in charge of the Wai-chiao Pu, with an intimation that under the circumstances it was impossible to give any further consideration to the application, which we preferred to regard as withdrawn.

9. The position of the Chinese navy in connection with the general political situation in somewhat as follows: The main flotilla, under the Commander-in-chief, Admiral Tu-Hsi-kuei, remains in the Yang-taze in the neighbourhood of Nanking. It will be remembered that in last summer's civil war Admiral Tu supported Wa Pei-fu and the Chihli party in their fight against Chang Tso-lin and sent ships to Shanhaikuan to bombard Chang's line of communications on the Peking-Mukden Railway. From the developments recounted above, however, it is apparent that, like many other of Wu's former supporters (e.g., Feng Yu-hsiang). Tu has now become to some extent extranged from Wu, and, though he may not take the field against him, does not intend to further his military plans, at any rate as far as his operations against the South are concerned. The Chinese Ministry of Marine and the Chinese navy are very largely staffed and officered by Fukienese, and Wu Pei-fu's action in forcing a Northern Governor on Fukien has naturally aroused their opposition. Admiral Tu recently made another threat against the Yang-tzu salt revenues (as he did last spring) owing to the non-receipt of the monthly subsidy of several thousand dollars which he was supposed to draw therefrom for the payment of his men. It was fortunately not found necessary for the Legations to intervene, and the matter

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bas. I understand, now been settled by the renewal of the subsidy. Another portion of the Chinese navy, consisting of the ships at Shanghai, have declared their independence" of Peking, and appear to have placed themselves at the disposal of the Anfu leader, General Lu Yung-hsiang of Chekiang. A third portion, the five ships under Admiral Wen-Shu-te in Canton waters, which the Central Government desired to refit at Hong Kong with a view to recovering them in Northern interests, had, I am informed, been heavily bribed by Wu Pei-fu to desert Sun Yat-sen, but permis- sion for them to refit at Hong Kong having been refused, their commander will presumably now await developments with a view to joining the winning side.

10. In Peking the prestige and authority of the Central Government continue to deteriorate, and the collapse of the Cabinet, which is as usual in extreme financial straits, is expected at any moment. Opposition to the Administration is becoming more and more apparent in Parliament, partly no doubt as the result of Sun's return to Canton and the outbreak of hostilities between him and forces representing Peking, and there have been unruly scenes in both Houses in connection with attempts to pass a vote of non-confidence in the Chang Shou-tseng Cabinet. Wellington Koo, who is still in Peking, was appointed Acting Minister for Foreign Affairs by mandate in the middle of April, but he has so far refused to accept the appointment, and the Wai-chiao Pu remains without a responsible head.

Enclosure 1 in No. 1.

I have, &c.

R. MACLEAY.

Mr. Mayers's Notes of Conversation, April 18, 1923.

Political Affairs: The Chihli Party's Programme.

THE following is a note of what was said to me on the 15th April by a Chinese official, who professes to know the policy of Tsao Kun and Wu Pei-fu :-

The plan of dominating Szechuan has already succeeded. Chungking and Chengtu are occupied. The next step in the West and South-West will be to fight T'Ang Chi Yao, the Tuchun of Yunnan, but this is less important than the movement against Sun Yat-sen at Canton. Within a month Shen Hung Ying (Shum) and Ch'en Ch'iung Min will drive Sun out of Canton, while Sun Chuan Fang-who is already in Foochow with the assistance of forces now advancing from Kiangsi, will attack the Chekiang Tuli (Tuchun) Lu Yung Hsiang, and will then have the open support of Tuchun Ch'i at Nanking.

Within three months the Chihli party will dominate all the provinces south of the Great Wall except possibly Yunnan and Kueichow. Wu Pei-fu himself will probably go to Szechuan, to bring the province into order and smash Tang Chi Yao of Yunnan.

At the same time, say, in June, Generals Wang Huai Ching (Jehol), Peng Shou Hsin (Shanhaikuan) and Feng Yu Hsiang (Peking) will attack Chang Tso-lin (Mukden). The latter's generals and regimental commanders are nearly all Chihli men, and will come over to the Chihli side. It is all arranged.

LL

By the autumn all will be over. It is all arranged. Tsao Kun will be elected President by the present Parliament or, if the present Parliament proves unmanageable, it will be dissolved and a new one will be elected, which will elect Tsao Kun as President. There must be a Parliament, because China is a republic. and it must be a large body of many hundreds of members because China is a large country. So Tsao Kun will be President, and the country will be unified. There will be no punishment or persecution of defeated rivals. They will become yuan lao (elder statesmen) and receive salaries. Chang Tso-lin will be required to live in Peking, but Sun Yat-sen can live where he likes.

"The Cabinet will be formed of the most suitable men. Liang Shib Yi is a bad man, but suitable for Minister of Finance. He may be Minister of Finance. Yeh Kung Cho is also a bad man, but he has experience of railways. He may be Minister of Communications, because if Liang is Minister of Finance, Yeh must be Minister of Communications.

Liang Ch'i Ch'ao will be Minister of Education. Wellington Koo or W. W. Yen will be Minister for Foreign Affairs. The difficulty is about the Premier. The most suitable man would be Tuan Ch'i Jui, but he cannot serve under Tsao Kun. as he is senior to the latter. Perhaps it will be Chou Tzu Ch'i. He is a

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