31

(See 34 on

53838/24/38)

A

it has been decided that we cannot allow munitions to

be exported to the Japanese in South China via the

Canton-Kowloon Railway, the Japanese would have

strong grounds for regarding such a course of action

as a breach of de fac to neutrality. Apart from the

risk of more serious consequences there is, as the

Governor points out, the probability that Japanese

troops would return to the neighbourhood of the border

if the Colony continued to act as a source of munitions

supply, thus increasing the likelihood of unfortunate

"incidents" and increased influx of refugees.

On the other hand, it might be maintained

that the Colonial Government cannot fairly refuse

permission to export munitions which are properly

authenticated by Chinese Government Huchaos.

"

The distinction that exports by lorry or coasting

vessel should not be permitted may prove aifficult

in practice, and even ineffective, and if any

would

distinction is to be made it be preferable to

destination

do this by specifying the wet in the permit

given for each particular consignment.

On general grounds, moreover, it seems to me that the policy of H. M. G. will be sympathetically inclined

towards any encouragement which could be given to

the Chinese forces whether in South China or elsewhere.

To stop the export of munitions from the Colony to

Kuangtung would be to cut off what may be a potentially

important source of supply to local forces, and arouse

strong resentment on the part of the Chinese Government.

I suggest, therefore, that on the whole our attitude

hould be to allow the export of munitions from Hong

Kong in any case where they are covered by Chinese

Government Huchaos

"

>

and are properly authenticated

?

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