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EXTRACT FROM LETTER DATED 31st MAY, 1939 from A. E. MARK???

HONGKONG.

Since my arrival here, and as a result of the various

conversations I have had with various people, I am more than ever

impressed by the confusion and the complete absence of co-operation

or co-ordination as between the various Government trading concerns

and the Institutions sponsoring them.

As you of course know, at the back of all this is primarily

the personal feud between Kung and Soong, and in matters such as

this where one is powerless obviously to effect remedies, it is

above all things essential to deal with the situation with which

one is confronted.

The Chinese themselves are all aware of, and in private con-

versation will admit the facts of the situation, but I have no

reason whatsoever to think there is any prospect of any sort of

remedy being thought out. Under the circumstances, it is unfor-

tunately probable that the present confusion will continue, to the

great detriment of all concerned. So long as this confusion con-

tinues at the very source it is of course useless to try and evolve

schemes to deal with this and that situation.

So far as the position in London is concerned, it is abundantly

clear that the Chinese have no plans at all. There do not appear

to be any arrangements at all for the payment of exports from the

U.K. by exports from China, and I rather gained the impression from

my conversations with Tsuyee Pei that there is no desire at all out

here to turn these London Credits into something of a Barter

arrangement.

I am personally very doubtful whether anything will be done to

create any sort of organisation at all in London.

Even if we should eventually succeed in negotiating some thing

of this sort, it seems to me inevitable that, so long as this

intense confusion and discord persists at thid end, no London

organisation could hope to work satisfactorily.

It must also be

remembered that the Chinese appear to be so completely in the dark,

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