CO129-501-8 General policy in China 30-11-1926 - 30-11-1926 — Page 155

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created enabling him to float a loan to save his

inflated currency from collapse inseparable from

reckless prosecution of wars of revenge and feudal

ambition:

(b) not alone Peking (whose receipt of Customs

surpluses has made it hitherto an object of envy) but every treaty-port will become a fresh object of mili-

tarists' plunder and an added incentive to perpetua-

tion of feudalism and civil war in China; and

(c) Shanghai, which has been on the eve of passing

to nationalist control without much fighting, must now become the theatre of a bloody struggle (involving my be permanent injury to foreign trade), since millions

to be collected, i.e. 40% of surtaxes, are to Sun

Ch'uan-fang and Chang Tsung-chang like raw meat to beasts of prey. If views and sentiments expressed in

British declaration leave nationalist mind unmoved,

it is because they cloak a policy that is objectively

a menace and a danger to speedy advancement of the

cause of Chinese nationalism. But those who support

the cause are strong enough to meet the danger" (Han-

kow telegram to Foreign Office No.1 of 1st January).

54.

In Chinese political circles at Peking the

reception of the British policy memorandum was not good. Fêng-t'ien politicians professed to object on account of the violation of the principle that surtax

proceeds should accrue to the Central Government for

administrative expenses and for debt consolidation,

by promises of which they probably hoped to curry favour with the Japanese and the French (Peking tele-

gram to Foreign Office No.1 of 1st January).

55.

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