CO129-494 - Governor Sir Clementi - 1926 [9-10] — Page 486

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of local Consule and without the assistance of Peking. The British Consuls at Ohungking and Ichang and the Commissioners of Foreign Affairs at these places seem to be settling the Wan-hsien incident without any interference from Peking. ir. Eugene Ch'en has called off the Canton boycott without advice or assistance from the acting Premier; and the Canton Goverment is now asserting its right to levy both "consumption" and "production taxes" on its own citizens, defying at the same time foreign nations "to raise the bugbear of infringing the integrity of the sacrosanct Maritime

Customs". The Canton Government is asking the Chinese Customs service to co-operate in collecting the proposed taxes, in order to avoid confusion and consequent

annoyance to trade; but it adds that it can, of course,

create its own entirely independent organ of collection,

if necessary.

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Apart from the consideration that, if the

Canton scheme succeeds, local tariff autonomy will

probably follow in every port of China, which might mean, incidentally, that no more Indemity contributions would be paid, surely facts of this kind make it doubtful

whether the Government of Paking will continue to exist

much longer even in name; whether, indeed, the next

phase in the Chinese turmoil will not be a general disintegration of the Chinese Republic. This is at least a view which is being more and more widely accepted out here, and it has penetrated also to the London press. A leading article on China which recently appeared in the "Spectator" contains the following:-

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"So far as we can see, it grows less and less likely that the great agglomeration of races and

tongues,

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