3.
38
9.
But from every point of view it would seem that
for the present Macao has little to fear from this irredentism
being as she is the least rich of the various possible prizes,
even if the most vulnerable. One has always heard that the
fall of Macao will be the first manifestation of the so-called
Yellow Peril, but there seems little danger of this at present
either from a partly organized armed mob or, still less, from
regular troops under Nanking's orders.
10.
Dr. Barbosa spoke of the Mediterranean but I need
only say that he does not fall into the common error of trying
to fit the Sino-Japanese conflict into the political dichotomy
of present-day Europe. Anything may have happened before you
receive this despatch, but as I write it would seem that both
Germany and Italy are finding it difficult to affix the
proper labels in Asia at a time when both are actively helping
China with munitions and with those "advisers" who alone have
made China's resistance possible. The Government of Portugal
is said to be anti-Bolshevik but Dr. Barbosa takes the
Macchiavellian view that out here this may safely be left to
Japan to deal with.
11.
Much has been made of Japan's peaceful penetration
in Macao and in other Portuguese colonies in Asia. The Macao
waterworks negotiations in 1935 and 1936, of which you are
aware, are a notable example, and besides these I was told of
an important land transaction in Timor, an attempted sub-
stitution of Formosan sugar for the Mozambique product, and,
in Macao itself, the question of certain concessions, salt and
alcohol in particular. Dr. Barbosa showed no signs of treating
this "bogey" too seriously though he is frankly against
Japanese intrusion and would from all points of view welcome
British capital in cases where foreign capital in Macao is
necessary.