1.
In his despatch at No.16, Sir Mark Young set out his recommendations as to the policy to be adopted towards the K.M.T. in Hong Kong. These were, briefly,
2.
(a)
(b)
(c)
that the subordination of the Head of the local branch of the K.M.T. to the Chinese Government's Diplomatic Representa- tive in the Colony would not be a real solution nor secure any real advantage for us:
that the only really satisfactory
solution lay in adopting as our long-term objective the eventual expulsion of the K.M.T., as an organisation, from the Colony:
that, whilst the Hong Kong Government should neglect no means of countering the activities of the K.M.T. by such ad hoc measures as might be possible, they should concentrate upon the task of collecting evidence with a view to the expulsion of the organisation when the case is complete or an emergency demands.
We sent the despatch to the Foreign Office (see No.17) expressing agreement with Sir M. Young's recommendations, and the hope that some immediate effective action could be taken to reduce, and if possible, to terminate K.M.T. influence in
Hong Kong. We also asked for Foreign Office views on the recommendations at (b) and (c) above.
3.
The immediate Foreign Office reaction to our letter, expressed verbally, was that the action proposed was far too drastic. They were, I think, considerably surprised when the Ambassador in Nanking, whom they consulted, expressed his agreement with Sir M. Young's recommendations (see telegram at No. 24). That telegram promised a despatch, which has now arrived and is registered at No.26. We wanted, however, to have the considered views of the Foreign Office before Sir A. Grantham's departure last week, and the F.0., therefore, gave us their reply (at No.25) before Sir R. Stevenson's despatch was received. not wish to modify their reply in the light of that despatch.
They do
4. The F.0. advice is, briefly, that the Hong Kong Government should pursue a more cautious line for the time being, though they do not exclude the possibility of our being able to expel the K.M.T. should there be a substantial deterioration in the Chinese internal situation. We gather this is quite possible within the next 3 or 4 months.
I might record here that I arranged for Mr. Kitson to come to the Colonial Office to meet
Sir A. Grantham last week. Mr. Kitson then expressed the view, based on the latest information from China, that unless the Nanking Government succeeds in bringing about a substantial improve- ment in the internal situation of Nationalist China within the next 3 or 4 months, there is a distinct likelihood of its authority disintegrating and South China breaking away, under Canton's leadership, and setting up an autonomous government.
Mr. Seel