Copy.
From CHINA.
Decypher.
Mr. Howe (Shanghai)
D. (Wireless)
9,50 a.m.
3rd February, 1938.
3rd February, 1938.
3rd February, 1938.
No. 226.
15
SECRET
My telegram No. 223 and Kr. Mackillop's telegrums
Nos. 76 and 89.
finished.
Military Attaché believes central government to be
Mr. Mackillop, who does not go so far, thinks
they will crack when forced to leave Hankow if not earlier
but does not foresee subjection of China as a necessary
conconi tant.
My own views are these.
If Powers stand aside completely central
government may well crack before economic and financial
pressure compels Japan to relax her grip. Moreover it
is possible but by no means certain that if we were to
encourage China to make peace with Japan on any terms
they might lose heart and seek to negotiate. But this
would not necessarily bring about peace.
Whatever may happen in North, Southern leaders
will not easily accept Japanese domination nor will they
agree to any terms recognising economic or political
domination of the North by Japan. I think that if Chiang
Kai-shek were to endeavour to make peace on such terms
Kuangai generale would assume control and would have
behind them not only sympathy of vast majority of Chinese
but some of the best organised forces in the country i.e.
their own (gp. undec.) men and Communist troops.
Even
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