CO129-619-1 Parliamentary delegation to China 1-9-1947 - 23-12-1947 — Page 92

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In the military sphere, the Communists have

had some success in Manchuria in recent months, and

some 90, of this large area is now under the more or

less effective controls of either the Communists or

their adherents. The Central Government still control

the railway corridor from Changchun southwards, but

their hold is a somewhat precarious one, both rail

and road communications boing threatened constantly

by gourilla bands. At the time of writing (end of

August) the Communists also control most of Shantung

province (excepting the port of Tsingtao, but

including Chefoo, which is within easy access of

Russian-hold Dairen and Port Arthur), and parts of tho

provinces of Joh 1, Suiyuan, Shansi, Shensi, Hopci,

Honan, Kiansu and Anhui. There are also Comunist

banüs in Kwangtung provinco. The Central Government

are in more or less effective control from the Yangtze

valley southwards.

14. Many predictions have been made in recent

months of the impending disintegration of the Central

Government's authority. It may be that this will

come about, especially if America fails to come to

China's aid. It must nevertheless be remembered that

China's is largely an agricultural economy which can

survive strains which would be unbearable in most other

countries. In alternative development would be that,

while continuing to function as the Government of China,

the present Nanking regime, whose authority has never

been very effective even in areas comparatively close

to the capital, will gradually lose offective control

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