182
(iii) The Japanese obviously look forward to an eventual raising of the Chinese standard of living in Japanese controlled areas; and quite a slight rise should very greatly increase the Chinese demand for sugar. (iv) There is a much increased demand for sugar cane within the Japanese Empire quite apart from its need as a source of food--because of its value as a raw material for alcohol, and so as an important factor in the solution of the national fuel problem.
On these grounds it would appear that the demand for sugar within the " yen bloc" will exceed home-grown supplies for many years, and therefore it seems unlikely that fear of Chinese competition will restrain the Japanese from developing the sugar industry on the mainland. It goes without saying that these plans, like all other plans for the large-scale development of Kwangtung and Fukien by the Japanese, call for the subjection to Japanese control of a wide hinterland, får exceeding the present area of the occupied zones.
V.—Amoy Development.
20. Light and water services in Amoy have been taken over by Fukudai Koshi.
21.
Nanko Koshi, a company for the export of Formosan Monopoly Products, plans to establish a liquor and cigarette factory at Amoy, which will use material brought from Formosa. It is hoped that work will start on construction in March 1939, and that the factory will have a capacity of 150,000-250,000 gallons of liquor, and 150,000 to 300,000 cigarettes.
22. A press report of the 28th January states that Amoy is full of Japanese nationals returning to the city. Some are old residents returning, and others new- comers. The following is said to be the result of a Japanese consular investiga- tion made at the end of December :-
Japanese (male)
Japanese (female) Koreans (male)
Koreans (female)
Formosans (male)
Formosans (female)
1,604
594
46
107
3,653
1,646
7.650
Of the above total, 3,000 were temporary visitors, and 4,650 permanent residents. There are also 1,631 Formosans and 53,419 Chinese returned from Colon Island. The naval authorities reported that at the time of the occupation 15,000 Chinese remained at Amoy. It is said that other Chinese refugees in Colon Island are now most anxious to return, and have submitted applications.
23. It appears that some of the more disreputable members of the old Japanese and Formosan colony at Amoy (who were useful enough material for fomenting trouble under the old régime) have now been refused permission to
return.
VI.-Emigration.
24. Under the auspices of the Taihoku Provincial Government and Police, an emigration association has been formed. Its purpose is to train and emigrate prospective emigrants, and to carry out the necessary formalities on their behalf.
VII.—Fishing.
25. The Shonan Maru, fishery experimental boat belonging to the Govern- ment-General of Formosa returned on the 28th January from an investigation of the fisheries along the China coast, over an area 400 miles long and 50 miles wide. from Kokusan Island in the north to the Keitei Islands in the south. The results are said to have been excellent.
VIII-Communications.
26. The Formosa Development Company apparently owns one ship, the Kinrei Maru; the purchase of more were contemplated, but an arrangement appears to have been reached with the Kinkai Yusen Kaisha instead.
<
1
{
7
27. In conformity with Japanese plans for cutting out Hong Kong as an entrepôt of South China trade, a service is said to have been inaugurated between Canton and Macao by a trawler of the Nippon Suisan Kaisha. It is said to have a capacity of thirty passengers, and to do the round trip once every five days.
28. Advertised sailings from Formosa to Fukien and Hong Kong are as follows:-
Osaka Shosen Kaisha-
Keelung-Amoy-Keelung: Four times a month. Takao-Keelung-Amoy-Keelung-Shanghai-Keelung-Takao: Twice a
month.
month.
Keelung-Amoy-Takao-Hong Kong-Takao-Amoy-Keelung: Twice a
Nippon Yusen Kaisha (European Service)—
Keelung-Hong Kong Hong Kong Keelung: Irregular, averaging
once a month each way.
29. There are no advertised sailings to Foochow, Swatow and Canton. The Dairen Kisen Kaisha was reported on the 18th January to be going to extend its Formosan service to Canton, and to increase sailings. Enquiries indicate that this is premature. The Osaka Shosen Kaisha has not yet been able to restore its Takao-Canton service, and does not wish a newcomer to get in first.
30. There is an air service between Taihoku and Canton, running daily in each direction.
(Most Confidential.)
IX. Concluding Note.
The following later information has been obtained from a usually reliable
source :-
++
(i) A Formosan, who before the "incident owned extensive house property in Amoy, and himself held a good job in Japanese employ, has had his property destroyed by the Japanese bombardment, and compensation refused. has lost his job, and is now reduced to earning a livelihood by peddling to the Chinese population opium supplied from Formosa. He says all trade in Amoy is dead except for the drug traffic.
(ii) When Amoy was first occupied, Japanese nationals were freely invited to return, but latterly this policy has been modified; and Formosan residents of good character and standing, who did not return at once, are now finding much difficulty in obtaining permission.
(iii) It is becoming a grievance that Formosan merchants are being gradually excluded by the Japanese from trade with the mainland. Not only are they excluded from army contracts in which they first had a part, but they are being pushed out even from the old-established trade with North China and Manchuria.
(iv) Mr. Kato, the Director of the Foreign Affairs Bureau of the Government- General, was in Foochow for six weeks last autumn, making plans for economic development. Some sort of understanding between the Fukien administration and the Japanese has long been believed to exist, but this would appear to indicate considerably more intimate relations than had been supposed. This report is founded upon a statement made by Mr. Kato himself in private conversation.
+
(No. 13.) Sir,
Enclosure 3.
Consul Archer to Sir R. Craigie.
Tamsui, February 16, 1939. IN continuation of my despatch No. on the subject of Japanese activities in South China, I have the honour to report that Viscount Inouye (see paragraph 10 of the report enclosed with that despatch) returned to Takao on the 13th February with several members of his mission, of whom Mr. Nagai, a
183