The Chinese Retreat The attempt of the Chinese at Shanghai
to hold the Soochow Creek was decisively 'frustrated this week, largely through the landing of 30,000 Japanese at Chapei, which turned the Chinese lines from the South. Though Nantao, south of the foreign settlements, still holds out, the bulk of the Chinese troops had by Wednesday withdrawn in good order south- west. The Japanese hold all the country south of the creek and are now in control of the whole of Shanghai except the International Settlement. Thus the battle for Shanghai is over and the war may be said to have entered a new phase. In the north the capture of Taiyanfu has protected the flank of the Japanese in Shansi and they pursue their advance down the Peking-Hankow railway. Thus, with North China to the 'Yellow River practically in their grasp, and the Chinese driven back from Shanghai, the Japanese have both \ indicated their prestige and attained their main military objective, the control of North China. There appears to be no reason why they should not now be ready for mediation. Yet in one respect they have not attained their " war aims " ; Chiang Kai-shek's government is still unbroken and China, though defeated, has in no sense been brought " to her knees." Determination to resist is still unshaken. Meanwhile the Nine-Power Conference at Brussels waits on Japan—minus M. Litvinoff, who has gone back to Moscow for reasons which appear to indicate no kind of breach with his British, French an I American colleagues.
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