BANKING IN CHINA
In dealing with the banking problems of the Far East, Mr. T. E. Pearce, the chairman of the Hongkong and Shanghai Banking Corporation, had no option but to tread very cautiously. The full report of the meeting now available in this country bears unmistakable evidence that he was saying much less than he would have liked to say. Nevertheless, his speech gives a striking picture of two outstanding features of the present position-the great difficulty of doing business at all in present conditions and the extraordinary pertinacity of the Chinese in managing to do business somehow. It was impossible, he said, to reconcile Mr. Hirota's declaration that the door would be "left wide open" with the trend of developments in North and Central China. Nevertheless, he reported that, partly through good fortune but mainly through good management, the currency and financial situation in China had been kept well in hand. He paid a tribute to the Chinese farmers and traders, who, in spite of restrictions, multitudinous forms of irregular taxation, and dangers and difficulties of transport, had managed, sometimes with Govern- ment help, but often without, to find ways and means of moving goods.
Mr. Pearce's estimate of the strength of the two combatants in the Far East is that, although the effects of the war are telling on Japan month by month, she is a well-disciplined country with a highly-organised system of Government, and it would be a mistake to under-estimate her lasting powers with conditions as they exist at present. China's loosely-knit organisation contrasts vividly with Japan's, but the threads are stronger than they seem, and have an elasticity which gives but does not easily break. His final plea was that no oppor- tunity of mediation should be missed.
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