Chengtu, Jan. 31.
The month of January has been a time of excessive tension in the environs of Chengtu. The Reds have kept everybody on the qui vive. We have had scares enough in the Northern area of the Province for the past two years, but the situation has been severely aggravated by the escape of the Communist army from Kiangsi through Hunan and Kueichow fappesring close to the Szechuan Border where they appeared to have every intention of attempting to join with the Northern Reds here. The speed of their advance unhinder-"Jed by any serious attack seemed 10 make the local populace sure of an rosy victory for the Reds u. this pro-
Military and civil officials had seats in the air-mail plane booked up for weeks ahead in their endeavour get families and money down river place of safety.
The bank rate went up overnight to $90 on the 100 to get money Shanghai. Rushes on the various Danks were only stopped by official faction. Many. towns" in Szechuap contiguous to the Border were reported already tumed over to the Reds. This is explained by the persistent report that in many cases the focal militia fearing a Red attack, took over the towns in the name of the Reds in the hope of saving their heads when the Reds did arrive, 'While the Reds are not closer to [Chengtu than six days' travel the real Jdanger is that local troops incited by Communist influences here will be Feady to turn over at a moments notice, "The unsettled conditions have favoured the schemes of the Reds in she North to make further advances ning has twice been reported captured, but to date it seems quite evident that the Reds have not enered the city. Kangyuan has been a utterly contested city. General Dsong-lan with his Shensi troops were attacked and withdrew into te city. Supporting troops came up anc attacked the besieging Reds trapping them between the river and the city. The Reds were badly defeated and (of away from this melee, 90 reported, with badly decimated forces, 'A Capable Commander General Chiang Shang-pu who was formerly the Brigadier of the Model Army of the 2ist and later was appointed City Defence Commissioner, has been dispatched to the Luchow area to assist the hard pressed former commissioner, General Lise Hal-tao, General Chiang's place here has Deen Meng Chang" of Liu Hstang's Zist Army. We were present changed to "Wel Ssu Si Ling." or "Commissioner for Protection of Chengtu." He holds both positions, his and Chief of Staff of 2ist Army. 'Liu Hsiang has implicit confidence in him, and he is certainly holding the city' with a strong "hand. Two "tuans" of the 28th and two "tuans™ of the 29th Armies are united under [his command for the protection of [Chengtu and environs. The Communist "cells" keep well under cover, Any appearance with literature oF [speeches and a well-equipped flying squadron is on them and they are locked away for a quick court= martial and a "sun-rise farewell."
Word from Luchow tells of he orders out to dig up the opium. Evidently the officials do not want Chiang Kai-shek to see opium growing here. General Fu Dsong-lan in administering the Kwangyuca area is reported to have abolished all the taxes except the land tax and is operating completely on this. This will mean a new day in Szechuan it entrenched in this province. The struggle will be bitter. We are glad Chiang Kal-shek is sending troops to Szechuan, "because we have not mush confidence in the opium sodden troops here,
Text read from the printed page and cleaned; old type leaves the occasional error.