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Enclo. No. 3.

for the Tsinanfu outrage last year, are hiding in

disguise in this Colony. I am endeavouring to verify this rumour; and, if they are found here,

I shall at once eject them both.

6. Chinese business with Canton has had a

sudden setback, and I fear that several months of

anxiety and even danger may be in store for this

Colony.

7. I received with the greatest surprise

your telegram, dated 25th March, from which I

understand that the proposal to return the British

share of the Boxer Indemnity funds to the Nanking

Government is still being actively pursued by

His Majesty's Government, and that instructions have been issued to His Majesty's Minister at

Peking on the subject. These instructions have

not yet reached me; but I cannot think that, at a

time when the Nanking group of the Nationalist Party is again engaged in civil war, His Majesty's Government would make any grant from these funds

to any Chinese regional Government. Funds of

any kind now placed at the disposal of the Nanking

Government would, of course, undoubtedly be used

for purposes of civil war.

8.

The Chinese characters for the names in

this despatch are given on a separate sheet.

I have the honour to be,

لله

Sir,

Your most obedient, humble servant,

Governor, &c.

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