CO885-11 — Page 132

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PUBLIC RECORD OFFICE

Reference :-

C.O.882/11

PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC. COPYRIGHT PHOTOGRAPH—NOT TO

252

Mr. Ch'ên: I presume you will consult your Government. As far as the future of this Conference is concerned we suggest that the Conference stands adjourned, and that in the meanwhile cor respondence between the Consul-General and the Foreign We have Minister be carried on. We do not want a breakdown. suggested a positive solution which may take time, but promises an eventual settlement. We are on the eve of big things.

Mr. Kemp: If the enquiry is to take place, and if the French are to take part, I presume that paragraph (b) of your enquiry pro- posal statement would be amended by the inclusion of a French judge.

Mr. Ch'ên: Yes. We have already stated our views on publicity. Three statements have already been sent to the Press, and your last statement will be inserted.

1

At this stage the British delegation retired for five minutes. On their return-

Mr. Brenan read the loan proposal statement, and added: —

(1) That any foreign technical assistance would have to be British, and

(2) That our loan proposal was for a complete settlement of the boycott, and that if any other proposal were adopted the loan proposal would be withdrawn.

Mr. Soong: What do you mean in your loan proposal by "adequate safeguards."

Mr. Brenan: If the Whampoa proposal were adopted the safe- guards would be similar to those in railway loans. The receipts would have to be paid into an approved bank. There would have to be an accountant under whose signature monies would have to be paid out-the usual provisions. Also, the works would have to be the security for the loan, and if they were not enough, per- haps the Canton Government could suggest further security. The works and the revenue would be the security, and would be mortgaged.

Mr. Brenan thanked the Chinese delegation for their courtesy during the whole proceedings, and for their evident desire to con- duct them amicably. He understood the Conference adjourned only.

was

Mr. Ch'en returned the compliments, and hoped that the Con- ference would turn a new page in the Nationalist history of China.

17695/26.

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No. 30.

The Governor of Hongkong to the Secretary of State for the Colonics.

(Received 16th September, 1926.)

Government House, Hongkong, 7th August, 1926.

Secret (2).

SIR,

At a meeting of Executive Council held on the 6th August, 1926, your telegram of the 4th August* on the subject of the boy- I also supplied a cott negotiations was carefully considered. copy of it to Mr. J. F. Brenan, His Majesty's Consul-General at Canton, and I had the advantage of discussing it with him to-day when he came to spend the week-end with me in Hongkong.

2. We share your view that the Canton Government is prob- ably not sincere in demanding an international enquiry into the Shakee-Shameen incident of the 23rd June, 1925, and we agree that this enquiry may have been proposed by the Canton dele- gates to gain time, in view of the military situation in Hunan, as well as to "save face." They probably also considered that successful anti-British propaganda could be made out of the pro- posal for an enquiry, whether unconditionally refused or condi- We further tionally accepted by His Majesty's Government. agree that, if the Canton Government were willing effectually to remove the boycott, as a condition precedent to the proposed enquiry, the immediate gain would be so great as to outweigh the dangers which I indicated in the 7th paragraph of my secret de- spatch of the 28th Julyf to be inherent in an international enquiry, even though confined solely to ascertaining the facts of the Shakee-Shameen incident and conducted under terms of reference drawn strictly for this purpose. The Canton delegates, how- ever, clearly intimated at the recent Conference that the Canton Government would not agree to the removal of the boycott as a condition precedent to the proposed enquiry, and there is no reason to suppose that the decision of the Canton Government on this point is likely to be modified, unless its "northern punitive expedition "' meets with disaster.

3. I have endeavoured to give a description of the military situation in South China in my secret despatches dated the 31st July, 2nd August and 6th August. The latest news appears to show that Marshal Wu l'ei-fu is likely to win his battle with the Kuo-min-chun at Nan-k'ou in the north, and that he may, there- fore, be able, before long, to turn his attention to the campaign

• C 14832 28; not printed.

↑ No. 29.

C 17108/26, C 17105 26 and C 17101 28; not printed.