CO537-2187 — Page 164

CO537 Colonial Confidential Records 理藩院機密檔案 All

Change in China

Marshal Chiang Kai Shek is expected within a month to reform his Govern- ment, basing it exclusively on the "Liberal" elements to which General Marshall referred in his homecoming report on China.

News of the impending change follows receipt in Nanking of reports that General Marshall intends, at the Moscow meeting, to seek an overall agreement on Far Eastern issues with the Soviet Government and is prepared to suggest that the "Big Three" should cease to recognise China as a Great Power until a Central Government of national unity is formed.

A further hint of the change was con- tained in an official Nanking statement this week, that Marshal Chiang Kai Shek expects the present financial crisis in China to be overcome in three months. Far Eastern observers assert that it can- not be tackled without extensive U.S. financial aid, which General Marshall has said will be available only after the Cabinet is shifted to a "Liberal

27 basis.

96

Scotsmen

24-FEB IS:

MIR Mayle. Miss Ruston,

MR J. 13. Williams (3)

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