CONFIDENTIAL.
27
Enclosure No. 3.
Honourable Colonial Secretary,
Last night General Chen Chiung-ming called at my
house to enquire after my health, and stayed for over an hour. Inthe course of a friendly conversation he gave me the following information and views on the present political
situation in China.
1.
The present strained relations between Chiang Kai- shek and Feng Yu-hsiang may develop into an open conflict. There can be no question that General Sun Liang-cheng's sudden withdrawal from Shantung without the permission of the Central Government was ordered by Feng Yu-hsiang who resented Chiang Kai-shek's despatch of his own troops to the province which he had virtually promised to Feng.
2.
Should warfare break out between Chiang and Feng,
Kwongsi would have a chance of saving itself. Under present circumstances Kwongsi is in a precarious position, and is bound to "go under" soon or late. Realising their position the Kwongsi leaders have lately been in negotiation with the promoters of the recently-formed "Great Republican Confederation" with a view to joining forces with
them. The latter at first desired the Kwongsi-ites to
divest themselves completely of allegiance to the Kuomintang, and to use the five-bar flag again, but the Kwongsi leaders hesitated to do so for the reason that in their own camp
there are two groups holding diametrically opposite views. One group is for denouncing the Kuomintang as being the
cause of all the existing evils, and for adopting once more the five-bar flag. The other group is for continued affiliation with the Kuomintang but denouncing Chiang Kai-
shek as having been untrue to the principles of the Party
which
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