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difficulties of direct reinstatement. Labour was in any case very largely shifting and transient, and many industries had been greatly reduced and not a few extinguished owing to the rupture of normal communications and life. Employers of skilled labour, such as His Majesty's naval yard, would be ready to re-engage such labour up to the complement required for work in view. But beyond that. apart from the impossibility of putting compulsion on individual employers, it would not be practicable to procure reinstatement of strikers in their original posts. Mr. Sung, however, pressed strongly the point that reinstatement must be facilitated by dismissal of blacklegs. He further stated very definitely that no settlement could be hoped for without the payment of strike pay, but would not hazard any guess as to the amount involved. Mr. Sung also intimated his concurrence in the view that the strike and boycott is injuring Kuang-tung, if not as much as Hong Kong, at least to a very serious extent. He pointed out that the province is now unified and in the process of reorganisation under a central authority backed by adequate military force. Already, he said, reviving prosperity was shown by an increase in the provincial revenue from a little over 1 million dollars to over 4 million a month. A campaign for the suppression of piracy was now being formulated, and with a strong and clear administration controlling a peaceful and orderly province, the possibilities of development were houndless-a development in which Hong Kong would receive a liberal share. His Excellency assented most cordially in this forecast.
(Note. The 1922 strike compensation question was mentioned at this interview.)
D. W. TRATMAN.
December 21. 1925.
(Serret.) Sir,
(ii.)
Sir C. Clementi to Mr. Amery.
Government House, Hong Kong, December 24, 1925. IN continuation of my secret despatch of yesterday, I have the honour to inform you that Mr. A. G. M. Fletcher returned last night from his mission to Canton, and I enclose a copy of the very interesting report which he has made to me.
2. You will observe from this report that the present nominal Government at Canton regards itself as a Labour Government and for this reason would be unwilling to take any action antagonistic to the organised labour movement in Kuang-tung upon which its power is based, and of which (so it is alleged by Cantonese officials) the present anti-British strike and boycott is a spontaneous and patriotic manifestation. I am also very doubtful whether in the absence of General Cheung Kai-shek and his troops from Canton. Mr. Wong Tsing-wai and his Council of Government have the power, even if they had the desire, to suppress the Strike Committee and abolish the strike pickets. At all events Mr. Sung Tsz-man made the significant remark that the present Government of Canton would not last a single day if it shot down the strike pickets. The Canton authorities therefore decline to intervene except as mediators, who would use their influence to prevent the Strike Committee from putting forward any unreasonable demands; and indeed the result of Mr. Fletcher's visit has been to eliminate from future discussion any matter except the payment of a lump sum of money by employers to strikers as a for ending the boycott, from which admittedly the Strike Committee derives by means a quid pro quo of its strike pickets a considerable income.
3. It is obvious that the Hong Kong Government cannot participate in negotiations for a settlement on these lines. but the question for decision is whether or not the Hong Kong Government would be justified in obstructing such a settlement. I discussed the whole subject very fully with the Executive Council this morning. Mr. Chow Shou-son. Mr. R. H. Kotewall and Mr. D. G. M. Bernard being also present hy my invitation. In stating the case to the Executive Council I laid emphasis on the following objections to the proposed bargain :-
(a.) It will not eliminate Russian Bolshevik influence from Kuang-tung. You will see from Mr. Fletcher's report that the introduction of Russians as advisers to the Canton Government was apparently due to the refusal of His Britannic Majesty's consul-general at Canton to allow Dr. Sun Yat-sen
GI
to employ Canadians for this purpose. The effect of this action was to give Borodin, the Bolshevik emissary from Moscow, who happened just then to be at Canton a unique opportunity for offering Dr. Sun the help of Russian officers as well as Russian money and munitions. I trust that the very serious damage to British interests which resulted from this unfortunate step may serve as a warning for the future; and I shall certainly use all my own influence to induce the Canton Government to accept British rather than Russian help hereafter. But there is no doubt that Borodin and his officers have established a strong claim to the gratitude of the present de facto Government of Canton and that it will not be easy to dislodge them. Until they are dislodged, they will be a constant menace to Hong Kong and they may prejudice the permanency of any settlement now made,
(b.) The proposed payment by employers to strikers is neither more nor less than a payment of blackmail, and such payment may be a positive encourage- ment to organised labour to proclaim another anti-British, strike and boycott whenever labour funds are again needed. There is, moreover, the possibility-I would even say the probability that, after the present boycott and strike have been called off, there may remain at Canton the nucleus of a Labour Committee ready and willing to seize any pretext, however flimsy, to raise "
from Hong Kong. easy money (c.) The present nominal Government of Canton has only been in power a few months; it has many Chinese enemies both in and outside the Province of Kuang-tung, and the chance of its being attacked and overthrown by a hostile Chinese general during the course of the next year cannot definitely be ruled out. If the present Government of Canton were overthrown, then it is possible that no permanent advantage would accrue to this colony from a settlement of the boycott in the manner now proposed. (d.) The power of the sword in the Kuang-tung Province rests apparently with General Cheung Kaishek, concerning whom I know very little. He has for several weeks been away from Canton; and he is now. I believe, at Swatow. I do not know whether he is loyal to Mr. Wong Tsing-wai and the Canton Council of Government. If he is not, and if he is really under Russian Bolshevik influence, he may perhaps by force of arms make himself dictator at Canton, divert to his own war-chest any payment made by the Hong Kong merchants to the Canton Strike Committee and con- tinue the boycott. I do not myself consider this contingency at all likely. but it is not beyond the realm of possibility.
4.
Is there then any means of ending the boycott without paying blackmail to the Strike Committee? I confess that the only means that I can see would be the use of armed force, military or naval. In my last despatch I explained that I saw little chance of the overthrow of the present nominal "Government of Canton in the near future either by the Chinese navy or by any Chinese general from another province. It is not to be expected that any European Powers will attack Canton for the purpose of ending a boycott from which some of them actually derive commercial advantage and from which none of them suffer as acutely as Great Britain. While, as regards the employment of British naval and military force to end the boycott, I am firmly of the opinion that whatever temporary relief might be obtained in Canton, Hong Kong and Swatow from such action would very soon be lost in consequence of the resulting animosity throughout China towards Great Britain. The time is past when it was possible for foreign nations at the point of the bayonet to compel the Chinese to trade with them; and our commercial rivals in the Far East are not slow to take advantage of any hostility displayed by the Chinese towards British merchants in China. At present, as far as I can ascertain, most of the eighteen provinces are looking askance at the doings of the Canton Government as at the antics of a naughty child. But if Great Britain were forcibly to coerce the Canton Government, it is almost certain that all Chinese opinion would be united in its support.
5. I am driven, therefore, to conclude that without payment to the Strike Committee there can be no settlement of the boycott, and that the present unfortunate The 12th February next will be situation instead of improving will grow worse. Chinese New Year's Day, and before that day it is customary for every Chinese business in Hong Kong and elsewhere to settle all outstanding accounts. settlement of the boycott is made by an early date in January next, it is probable
Unless a
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