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China and imbue them with Communist teaching directed

The seduction of primarily against foreign interests.

the peasantry will necessarily take time, but the labouring masses in the big towns and the student community have readily swallowed the bait. They have allowed themselves to become highly organised and have indulged in violent propaganda and anti-foreign demonstration.

The Shanghai riots of the last month of May and the Canton boycott are the first fruits of the new Russian gospel ofhatred. In the former place the trouble began in a Japanese mill and labour's grievances, such as they were, were against Japanese

In the latter place it was the owners and foremen. French who first replied to the fire of the

demonstrators.

In both places the agitation as it developed became more anti-British and less anti-foreign.

4. Spectacular though the past year has been and damaging to foreign interests, Russia as she looks back can have no very good grounds for self- congratulation. Her one success she has achieved is in the South, where rather by luck than good management her agents are crippling a British Colony which hitherto has prided itself on its invulnerability. But against this success must be sat the failure of her scheme in the North. The defection of Feng Yu Hsiang must have come as a grievous disappointment. He was not defeated in the strict sense of the word, and one can only surmise that he saw the futility of continuing to offer battle to an adversary who could rely on Japanese support. Had Feng been successful against

zile

Bc. nt. fices

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