FO371-23518 — Page 70

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F10413 7987

1938

10

8.

accommodating attitude which the British authorities

adopted in this regard.

12.

I do not suggest, however, that the question

of the Shanghai Pilotage Service may now be considered

to have been finally settled. As I stated in paragraph

7 of my despatch No. 339, it is rumoured that, before

long, the Reformed Government will attempt to gain

control of the Filots' Association, and these rumours are

substantiated to a certain extent by the report contained

in Chungking telegram No. 166 to Your Excellency

(paragraph 4). It is unfortunate, also, that another

two vacancies have occurred in the association, and that

the question of filling them has again risen. The

Manager informs me that they have every hope of re-

cruiting a Briton and a Netherlander, who would be able

to buy their shares with the assistance of one of the

local banks, but, while the Japanese have not yet made

any move in the matter, some further approach from them

may certainly be apprehended. I have arranged for this

office to be kept informed, and I shall have the honour

to report developments to Your Excellency in due course.

13.

I have one further item of interest to report

in connection with the affairs of the Shanghai Licensed

Filots' Association before I conclude this somewhat

lengthy despatch. as Your Excellency is doubtless

aware, the gold unit, although it is still maintained

by the Customs at a nominal rate for duty purposes, has

practically disappeared from the market, with the

result that, as the capital of the Shanghai Pilot Boat

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