The excellent summary of China's position vis-à-vis of Japan in the present hostilities, obtained by Reuter from officials in Chungking, might be termed a trifle optimistic in vein. It is declared that the only hope for peace lies i an international conference on the lines of the Washington Conference, a proposal which Tokyo has already flatly refused. Japan believes in its mission to establish a "new order in East Asia," and nothing short of a "new order" is likely to satisfy the nation's leaders. China, however, is opposing this "new order" so long as it requires loss of Chinese sovereignty and Japanese hegemony on the mainland. From this complete opposition of views nothing is likely to materialize which will contribute toward: peace, Nevertheless, it cannot be denied that both sides would like to have peace as soon as possible. The Chinese government, courageously though it is carrying on, has been crippled by the Japanese victories; most important cities and lines of communications have fallen to the invaders; and a stranglehold has been placed on the Maritime Customs, one of the chief sources of China's credit. But is Japan in any much better condition? It is unfortunate for Tokyo that Chinese losses have not alway: meant Japanese gains, while the material drain on the country's resources is enormous. In addition Japan has outside preoccupations, chiefly with Soviet Russia, as is shown by the most recent border clash in Manchoukuo and the deadlock over the fisheries dispute. Japan would very much like to free itself from entanglements in this country, but cannot do "o until at least some of its declared objectives have been obtained. So far none of these objective has been approached, and the prospect ahead must appear to Tokyo's eyes none too rosy.
Text read from the printed page and cleaned; old type leaves the occasional error.