CO129-502-8 China- general situation 27-4-1927 - 15-9-1927 — Page 83

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Tangshaoyi recently informed me that on a pair of shoes made

at his native village Tongkatsun (see my despatch Secret of

1st July) taxes had to be paid 33 times on the way to Canton.

Fact is that in the delta extortion by brigands is super-

imposed on the Likin machinery and squeezes trade in a

manner which Canton Administration is powerless to prevent.

If tariff autonomy is successfully usurped by

Nanking Government other Chinese region authorities would

undoubtedly follow suit but they would probably repudiate any assurances given us by Nanking nor (?omitted could any confi-

dence whatever be placed in any assurances given us by

Nanking Government which would not hesitate to repudiate them

if found inconvenient later on and which itself may not long

exist.

It must constantly be remembered that any additional

revenues granted to China would only be used for civil war

and further impoverishment of the country whereby foreign trade is being steadily ruined.

In conclusion I strongly urge that it now

imperative to make all Chinese region

authorities understand

that no further encroachment on British treaty rights will be tolerated. Hong Kong is not opposed to grant of tariff

autonomy to China by negotiation in due form and under reason-

able safeguards for its proper administration but we consider that under the chaotic conditions now obtaining tariff autonomy is not a practicable proposition and that to allow it to be usurped by individual regional authorities would be most

detrimental both to our trade and to the Chinese themselves.