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PUBLIC RECORD OFFICE

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C.O.882/11

PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-

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Ping-sheung and Mr. Wong Cheung-kuk at the Foreign Office, the same party, with the exception of Mr. Wong Ching-wai, being present. Mr. C. C. Wu came at once to business. They had found a way round the impasse. The Government would be able to persuade the strikers to waive the political terms but a formula would be necessary. I replied that in that event 1 would stay on and get this formula definitely settled. Mr. Wu said it would take some time and it would be better for the merchants to come and discuss the crucial questions of reinstate- ment and strike pay. I said that I must know the terms of the formula first. The Hongkong Government could not allow the merchants to enter upon protracted negotiations, if at the end a formula was to be put forward to which the Hongkong Govern- ment could not agree. Mr. Wu then gave me to understand that the matter depended upon the settlement with the merchants. If this was satisfactory, there would be no necessity for a formula, but the strikers would not abandon any part of their We then position until they were sure of their main point..

I pointed out that on Mr. proceeded to define the position. Sung's original argument it was the Chinese merchants of both places who received benefit from the strikers' patriotic sacrifice, and the British merchants were therefore not concerned in the question of compensation. Mr. Wu replied that, in the first place, nothing was to be expected from the Canton merchants. They were even appointing delegates to sit with the strikers. Canton was very prosperous, shipping was increasing daily, and large volume of trade was being successfully diverted from Hongkong to Canton. The West River trade, for example, used to be entirely in Hongkong hands and Canton merchants had now got it. It was the same with regard to the shipping with Shanghai. A large number of the merchants were now opposed to a settlement. As regarded the British merchants, taking the longer view they were ultimately benefited by the strike, as it would hasten the independence and so the prosperity of China, At any rate, the with consequent increase of foreign trade. British merchants were interested in the question of reinstate- ment. I replied that the question of reinstatement had been fully discussed. There was no rancour against the strikers per- sonally, and I felt sure that the large majority would take their men back if they had vacancies for them. The Commodore, as I had already told them, was prepared to take back his skilled men in the Naval Yard in proportion as the work expanded and provided vacancies for them. It seemed to me that the reinstate- ment question resolved itself into one of payment, and that there was no ground for the British merchants to come up specially to discuss it. If the British merchants stood aloof and did not pay, would the strikers on that ground refuse to negotiate? The Council agreed that they would not refus but that the negotiations would be considerably more difficult A settlement was, however, quite possible if the Chinese merchants would meet the strikers in a liberal spirit. The Council d put to the strike pay strikers my earlier query as to the amount of the claimed, but they could give no answer. They were working out the figures. Mr. Sung had suggested to me on board H.M.S. "Tarantula " that the figure would run into several millions. In the course of the discussion Mr. Sung said that he wished to correct a wrong impression which he had given at the last

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meeting. It was not correct that the Government was not firmly in the saddle and that it would fall if it coerced the strikers. It was in a position to impose its will absolutely, but, if it was to coerce the strikers against popular sentiment, it would lose, and rightly lose, the support of the people. I replied that, if the Government had complete control, the least it could do was to see that all within its jurisdiction were compelled forthwith to conform to the civilised usages which were universal in the intercourse of friendly Powers.

was

When the discussion was ended, I said that I wished to make a very serious and carefully considered statement. The Council had informed me that they were in complete control of the situation. What was the logical. conclusion? Canton maintaining a complete boycott of all British shipping and it was refusing all trade facilities to ships of others nations which touched at Hongkong. This was contrary to all international law and custom, and such a state of affairs could only obtain The Canton between civilised nations when they were at war. Government must very shortly decide whether they would accept the responsibility for this state of affairs, or whether they would repudiate it and put an end to it. If the strike negotiations failed, I felt sure that the British Government would call upon them to make this decision.

The Council in conclusion promised its most cordial assistance in promoting every means of enabling the merchants and strikers to arrive at an amicable settlement. Mr. Sung reminded me of the Chinese proverb that a match-maker could bring the parties together, but could not guarantee that children would result. They would keep in close touch with the Hongkong Government. and officials would exchange informal visits, if it should appear I expressed my that this would help the situation in any way. very great obligation to them for the friendly manner in which they had received me; the frank manner in which they had dis- I would cussed the problem, and for their kind hospitality. inform the Governor. Mr. Sung asked me to express to the Governor his appreciation of the latter's hospitality.

As we were leaving I returned and asked if I might speak privately with Mr. C. C. Wu. I said that, as a newcomer to Shameen, I was impressed by the extraordinary state of affairs. It seemed to be in the position of a beleaguered fortress, a position which was at least anomalous, and appeared to be quite As our Governments had arrived at a friendly unnecessary. understanding, could not Mr. Wu meet the Consul-General half- way and arrange for Shameen to be opened up for ordinary ingress and egress. I was not suggesting a lifting of the boy- cott. It would, of course, be a necessary condition that the Canton Authorities should effectively control the strike pickets so as to prevent any possibility of an incident. Mr. Wu replied somewhat bitterly that the fault was entirely the Consul-General's with his absurd wire and sandbags for which there never had He would, been any necessity, this had disappeared months ago. however, meet the Consul-General half-way in the establishing of friendly relations and he would guarantee that the strikers' I informed the Vice- pickets would be effectively controlled.