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at Pearl Island Harbour (Hawaii), against which the risk of attempting a major combined operation at a distance by sea of some 3,500 miles was overwhelming, so long as the American fleet was in being and at sea. Hence the surprise air attack which in the result was very successful. The island ring secured, Japan would then be in a position to conduct operations against her main objects of Singapore and the Philippines without having constantly to watch her eastern flank.

34. At the outbreak of war with Britain and the United States, Japan had available 62 divisions, of which approximately 14 are now committed in the south. As reserves available immediately, or at short notice, it is believed that she has a further 14 divisions and sufficient shipping to transport the equivalent of 12 divisions.

35. The present estimated enemy strength in North Malaya is three divisions and one tank regiment.

36. The chief factors in the situation at present appear to be time and the attitude of Russia. Japan must have quick results in view of her difficult economic situation and the inevitability of defeat, if the United States and ourselves are given time in which to build up our strength against her. She is also anxious not to start another front in the North, whilst fighting is still in progress on the southern and China fronts.

It therefore appears that after the initial phases of the war are over, the position of Japan, who has now been at war for over four years in China, will become precarious if operations are opened on her northern front, and if sufficient time becomes available to the United States and ourselves to strengthen our military position in the Far East.

Malaya.

37. In North-East Malaya 8 Indian Inf. Bde. holding the Kota Bharu area has been reinforced with one battalion and one field battery, and has now fallen back to a line covering Machang aerodrome (25 miles south of Kota Bharu). Since the 12th December activity has been confined to patrols.

38. In North-West Malaya heavy attacks by Japanese forces estimated at one division (subsequently reinforced by a second division) supported by a tank regiment (150 tanks) have forced back 11 Indian Division, with 12 Indian Inf. Bde. protecting its flank, to the line of the River Muda (12 miles north of Penang and approximately 70 miles from the frontier.

Heavy casualties in personnel and equipment have been suffered and our troops have fought without respite. 6 Indian Inf. Bde. on our left were cut off and suffered severe casualties.

39. Penang, from which some troops have already been withdrawn to join the Kedah battle, is now seriously threatened. Heavy air attacks have produced a difficult position.

40. Japanese attacks are being pressed home with fanatical courage in spite of heavy losses.

Sarawak.

41. A Japanese landing took place on the 16th December at Miri, from which our small garrison, having completed the oil denial scheme, had been successfully withdrawn to Kuching.

No attack on North Borneo has yet been attempted.

Hong Kong.

42. In face of increased enemy pressure in superior numbers, our forces withdrew from the mainland and Stonecutters Island to Hong Kong Island in

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