CO129-573-2 Export of torpedo boats to China 14-5-1938 - 5-10-1938 — Page 54

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factory in Hong Kong; and possibly it is the fact that

the basis of our policy is not so much concerned with the principle of neutrality in de facto war conditions as with the avoidance of local provocation to the

Japanese naval and military forces.

Some consideration

of that sort would cover both (1) the decision to immobilise (nominally with Chinese consent) the Chinese war vessels now in Hong Kong, and (2) the

hesitation to carry out the duty of a neutral to

prevent (e.g. by the institution of an adequate naval patrol) assaults in Hong Kong waters by Japanese

warships on Chinese fishing boats and Customs vessels

(on which the Foreign Office have now supported our view with the Admiralty).

8.

Our instructions to the Hong Kong

Government to conduct itself in present circumstances

as would befit a neutral under the Hague Convention XIII (Colonial Office telegram of 22nd January to the Governor) can hardly override the Colony's obligations under such International Agreements actually in force

as