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the crowd with a minimum of bodily injury, should these directions be discheyed. Arrangements were also made for a military route march past the Lee Gardens at about the time when the meeting was due to end. The Emergency Regulations forming Enclosure No. 10* had in the meantime been amended to provide for the prohibition and dispersal în mediis rebus of any objectionable mecting and an order under clause 5 of the new regulations, copy of which is enclosed. was held in readiness at Government House for use in the event of
the proceedings taking an undesirable tone. I am, however, glad to say that, thanks to the firmness and tact of the police under Mr. T. H. King (Director of Criminal Intelligence), assisted by Mr. R. A. C. North (Chief Assistant to the Secretary for Chinese Affairs), the mating held on the 12th March dispersed without any untoward incident. I am also glad to say that, although parties of schoolboys and schoolgirls attended the Lee Gardens, the schools of the Colony as a whole, with a few notable exceptions into which further enquiry is being made, took no part in these celebrations. It is, of course, the aim of this Government to keep school children out of politics. I may add that the Lee Gardens celebrations were organized chiefly by the Seamen's Union assisted by some young Chinese men and women who are quite unimportant and who have no real influence in Hong Kong.
2. On the same day (12th March) the arrogance of the Seaman's Union received another set-back. Certain
" union stewards on the S.S. Fatshan (owned by Messrs. Butterfield and Swire), which was lying at her Hong Kong wharf preparatory to leaving for Canton at 8 a.m., saw fit to celebrate the day by posting on the ship's super structure (where it would be visible to all comers) a placard de- nouncing the Imperialists" for sending troops to Shanghai. Other posters in praise of Dr. Sun were put up in other portions of the ship. The police on duty attempted to remove the first-named placard but were met with threats of violence from the crew and had to send for reinforcements. On the arrival of these, the offending placard and one other were taken down by the Assistant Director of Criminal Intelligence (Mr. L. H. V. Booth) and later referred to the Secretary for Chinese Affairs. The first poster was confiscated and the other, being harmless, was returned to the Captain of the ship. The crew thereupon refused duty and the ship was finally removed from the wharf and anchored in the stream by European staff. An attempt was then made by the Union officials to call a general strike of river- steamer crews; but they appear to have met with no sympathy what- ever from other crews. It is even stated that they were told brusquely by fellow-members of the Union to let seamen earn their living in peace. Eventually, on the morning of the 15th March, the S.S. Fatshan resumed her sailings with the same crew.
3. The quarrel (see paragraph 5 of my despatch of the 11th March†) between the Nanchang clique of the Kuomintang, headed by General Tseung Kai-shek, and the Hankow clique, headed by Comrade Hsü Chien (not apparently by Comrade Sun Fo, though he is in support), has become more public. The latest reports appear to indicate that
Printed as enclosure in No. 6.
+ No. 6.
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The issue is between the many-headed and the single-headed theories .. Government. A copy of a most interesting first-hand report on the whole position from a confidential source is enclosed. It may cause surprise that General Tseung should be found ranged against proletariat rule in view of the sentiments expressed at the interview reported in Enclosure No. 7 to my secret despatch of the 17th February. † But every Chinese politician is a past-master of the art trimming and there is no more efficient factory than the Kuomintang propaganda bureau for turning out ready-made senti- ments appropriate to the moment for the use of its members.
4. The peace and order afforded by this Colony in contrast with the dangerous chaos in China appears to be attracting a steady inflow of Chinese from Kwang-tung and elsewhere. The inward passengers by the river steamers for the period 21st February to 7th March have been over 9,000 in excess of the outward, and the railway returns for the period 14th February to 6th March show a similar excess of over 5.000, A portion of this tide may be a reflux of the Chinese New Year exodus and yet another portion may be ascribed to overseas emigration. But I believe the Colony is filling up, as it has so often before, because conditions in China are becoming intolerable.
5. Another sign of the times is a complaint addressed by the Com- missioner of Chinese Maritime Customs to the Harbour Master to the effect that the crew of the S.S. On Lee (British flag, Chinese owned) refused with menaces of violence to allow the Customs officers at Kong Mun (Kongmoon) to search their quarters for contraband. The owners, on being called upon for an explanation, pointed out that the crew had been forced upon them by the Canton Seamen's Union and that the ship's officers, while in Chinese waters, have no means of compelling the crew to do anything they do not wish. Chinese sailors are the most inveterate smugglers in the world and it is interesting to compare this incident with the recent attack on the Customs House at Wuhu, which is stated to have been due to interference with opium -muggling.
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6. In conclusion I have the honour to transmit the following docu- ments bearing on the general situation:-
(a) Copy of a memorandum by a Church of England missionary in Kwang-tung furnished to me by the Bishop of Victoria.
(b) An extract from a report, dated the 10th March, by the local representative of the Federation of British Industries.
(r) Translation of an article in the Man Kwok Yut-Po, Canton, of the 26th February containing a report of Mr. Eugene Ch'ên's of the statement to the Central Propaganda Committee Kuomintang on the action taken with regard to the despatch of British forces to Shanghai.
I have, etc.,
C. CLEMENTI,
Governor, &c.
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* Not printed.
+ No. 4 (enclosure not printed).
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