CO885-11 — Page 99

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mumin

PUBLIC RECORD OFFICE

Reference :-

C.O.882/11

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-

COPYRIGHT PHOTOGRAPH-NOT TO

PUBLIC RECORD OFFICE, LONDON

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8. Mr. Brenan telegraphed to me in this sense on the 4th June, saying that he would suggest the adoption of the course (b), which aims at settling all anti-British trouble in Kuang-tung, and not the Hongkong boycott only. I consulted the Colonial Secretary, the Attorney-General and the Secretary for Chinese Affairs, and telegraphed next day to Mr. Brenan-

(a) that the Hongkong Government was ready to re-open negotiations with Canton as soon as possible,

(b) that I should prefer a letter addressed by Mr. Ch'ên to Mr. Brenan proposing that the Cantonese delegation com- posed, as Mr. Ch'ên suggested, of himself, Mr. Sung Tsz- man and Mr. Chan Kung-pok, with full powers to negotiat: as principals, should meet Messrs. Brenan, Kemp and Halifax to negotiate a settlement of the anti-British trouble throughout Kuang-tung: and,

(c) that I would be willing that Mr. Brenan should ad- dress a reply, accepting this proposal, to the Minister for Foreign Affairs of the Nationalist Government of Canton.

9. It would seem, however, that the reconstituted Canton Government is in a great hurry about these negotiations, for Mr. Ch'ên, without waiting for a reply to his private communication to Mr. Brenan, wrote to me on the 5th June, the letter* of which I attach a copy, and which states that the Government is ready to enter into negotiation with the Government of Hongkong and is prepared to appoint three delegates with plenipotentiary powers. This letter was forwarded to me through Mr. Brenan, and reached me on the 7th June. Mr. Brenan tells me that Mr. Ch'ên, after their private interview of the 4th June, attended a meeting of the Canton Council of Government which evidently told him to carry on without losing time. Mr. Brenan believes that the Canton authorities are very hard up for money, and that they recently tried to borrow $100,000 from the Bank of Taiwan, but were turned down.

10. I have not yet replied to Mr. Ch'ên's letter, for Mr. Brenan is due here on the 8th June, and Mr. O'Malley, Councillor of His propose to Majesty's Legation at Peking, on the 10th June. I discuss the matter with them, and also with my Executive Council before sending a reply. But a further indication of the anxiety of Canton to press forward these negotiations is afforded by the fact that on the 3rd June the Canton General Chamber of Com- merce had a meeting with the various other Canton Chambers to discuss preliminary measures to hasten an end of the boycott. As a result there were sent from Canton to Hongkong on the 5th June, two Chinese merchants, Messrs. Ma P'ak-nin and Leung P'ui-ke, to consult the Chinese merchants of Hongkong concerning the best means of ending the boycott. These mer- chants have had informal conversations with Sir Shou-son Chow and Dr. Kotewall, but nothing tangible has so far eventuated.

• Enclosure 2.

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11. The reasons for this sudden haste on the part of Canton can only be a matter of conjecture, but I have little doubt that Bolshevik intrigue has again been at work. The two bitterest enemies of Bolshevism in China-Marshals Wu P'ei-fu and Chang Tso-lin-are endeavouring to bury their old enmity and patch up an alliance. Marshal Sun Ch'uan-fang, who appears now to control five provinces-viz., An-hui, Che-kiang, Kiang-su, Kiang-si and Fu-kien-is still sitting on the fence, while Marshal Feng Yu-hsiang, the so-called "Christian General," menaces Marshals Wu and Chang from Mongolia and Shansi. It is plainly the Russian game to help Marshal Fêng from the north, and the Canton Soviet from the south to destroy Marshals Wu and Chang, while Marshal Sun remains neutral.

If this strategy succeeds, Bolshevism will again dominate northern and southern China, and will also extend into central China. After that, there will only remain Marshal Sun to be dealt with. Accordingly, Jacob Borodin and General Gallent, who recently returned to Canton, have arranged to supply General Cheung Kai-shek liberally with arms and ammunition upon the understanding that he shall conduct an effective campaign into Hunan Province, so as to menace Marshal Wu from the south, and prevent him from uniting with Marshal Chang to crush Marshal Fêng. It is, of course, just possible that General Cheung Kai-shek is playing a double game, and that, having got all he can from the Bolsheviks in the way of arms, ammunition and money, he may declare him- self" War Lord" of Kuang-tung and Kuang-hsi, and endeavour to establish himself as dictator of the south in the same manner as Marshal Sun has established himself at the mouth of the Yangtsze. But, in any event, General Cheung needs all the money he can get; and he must know that the boycott hampers him in getting supplies, that armed strike pickets at Canton will be a danger to his prime base when he takes the field, that at a time when his war-chest is none too full it is foolish to allow the Canton Strike Committee to collect a revenue of its own by exactions on foreign trade, and that foreign ill-will must weaken him in his control of Kuang-tung. No doubt, he also still hopes that negotiations with Hongkong may result in his getting a cer- tain amount of "free money,' whether from a development However, only the future can

loan or in some other manner. show what his purpose really is.

12. Meanwhile there is news from Canton to the effect that the Canton Government intends no longer to pay to the Canton Strike Committee the dole of between $7,000 and $10,000 a day, hitherto granted to strikers as a subsistence allow- ance. This cash support is to be withdrawn on the ground that the money is urgently needed for the northern campaign. More- over, for months the strikers and strike pickets have been in the habit of occupying at will any empty premises they could find in Canton, the only formality being to notify the Police Department that they had moved in. No pretence was ever made of paying rent. But, on the 5th June, Mr. Li Cheung-tat, the Chief of Police, notified the strikers that this practice must cease. It is