CO537-3713 — Page 19

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(5/1162/46)

dor, NANKING.

TOP SECRET

No. 19.

No.36.

GOVERNMENT HOUSE,

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m.

HONG KONG,

28th May, 1948.

Sir,

(31) a '47 file 100

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I have the honour to refer to your Top Secret Despatch No. 14 of 12th September, 1947, concerning the activities of the Kuomintang in Hong Kong, and to submit herewith a report on the present position. I regret that a report has not been submitted to you earlier.

2.

In your despatch under reference you directed that no immediate action should be taken to expel the Kuomintang from the Colony, but that this Government should continue to exercise surveillance over its activities, and should confine itself to countering any undesirable activities by such ad hoc measures as may be possible; and that at the same time evidence should be collected in order to be able to establish a clear case for banning the organisation from the Colony, at an oppor- tune moment, should this be considered desirable.

3.

I have generally been guided by the above except for a brief period during last February, after the Kowloon City incident, when

I have immediate action against the Kuomintang seemed to me desirable. dealt with this more fully in paragraph 5 below. My present view is that action to expel the Kuomintang is neither possible nor desirable, so long as we tolerate the activities of certain other parties in Hong Kong, such as the Chinese Communists, the China Democratic League and I consider Marshal Li Chai-sum's Kuomintang Revolutionary Committee. that the policy outlined in the preceding paragraph remains the only one practical at present.

4.

In reviewing the activities of the Kuomintang in Hong Kong during the year which has elapsed since Sir Mark Young sent to you his Top Secret Despatch No. 13 of 17th April, 1947, I am able to report that the Kuomintang has steadily continued its policy of trying to assert control over the so-called "Overseas Chinese" residents in Hong Kong, in order to make them look towards Nanking rather than towards this Government for guidance and the solution of their problems. The intensity with which it has pursued this policy has varied, reaching its peak in January- February last at the time of the Kowloon City incident. Nevertheless, I am of the opinion that the Kuomintang has not succeeded in making much progress towards the consolidation of its influence in the Colony. only issue on which the Party readily gains support is the issue of nationalism, and it is primarily in this field, in arousing the latent nationalistic feeling of the Chinese, particularly among students, that it has most success, and presents the most serious threat.

The

5.

The Kuomintang during the period immediately succeeding the Kowloon City incident was in the forefront in fanning the anti-British feeling which was aroused. In this, the "National Times", the local organ of the Kuomintang was the chief offender. This newspaper is financed from Kuomintang coffers; the editor and staff are paid by the Kuomintang from Nanking, and have openly stated that they regard themselves as Chinese Government servants. This is an ironic reflection on the fiction that

The demonstrations in Canton, one-party rule no longer exists in China.

At.

THE RIGHT HONOURABLE

A. CREECH JONES, M.P.

- 4 JUN 1948

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