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by Major Hilton Johnson, Commissioner General of the 11 Shanghai micipal Council, in consultation with some prominent Chinese officials and with Colonel Steward, British Military Attaché at Peking, for the information of the Shanghai Chamber of Commerce, in view of the critical situation which may arise in the event of the continued advance of the Cantonese forces down the Yangtsze.

3.

I particularly invite your attention to the passage in this appreciation in which Major Johnson, after referring to the immense pro-Southern feeling

in Shanghai", points out that "the Nationalist move-

ment as a whole, of which the Cantonese are the militant

champions at this time, is aimed equally at the treaty privileges of all foreigners without distinction as to country of origin. That the Nationalists might endeavour to do here is indicated to some extent by what they have already done in Canton, Hunan and Hupeh where, according to latest reports, conditions are gradually becoming worse. What they actually plan to do, according to my informant, is to bring about a complete paralysis of local trade and industry. This is to be accomplished by intensive picketing, boycotts and strikes among all classes of labour, in the expectation that in due time the foreigners will be reduced to a frame of mind in which they will come to realize the unprofitableness to themselves of continuing to resist the inevitable and will accordingly be willing to accept the terms

In other imposed on them by the Nationalist Party. words it is a case of the Canton-Hongkong scheme of 1925-1926 being applied in Shanghai, the objectives on this occasion being the almost immediate abrogation of so-called unequal treaties, the abolition of Extrality

and

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