In the last week China has suffered two serious blows.
The first, the fall of Suchow, has given Japan control of the whole length of the Tientsin-Pukow railway ; but the victory is incomplete, as the encirclement of the "70 Chinese divisions" which Japan aimed at has apparently failed, and the Chinese armies appear to have avoided the " pincers " closing in on them. The second may prove to be more serious than the loss of a battle or railway, an army corps or a province. Herr Hitler has now recalled the staff of German military experts who for ten years have worked in China to form the armies which have offered such astonishing resistance to the Japanese. For many years their chief task was to help suppress the Chinese Communists. Nothing could better illustrate the paradox of Japan's " anti-Comin- tern " policy than that the German experts are now co- operating with the Chinese Communists against Japan. Their return to Germany would be a very serious loss to Chiang Kai-shek, but it is by no means certain that all of them will go. The Chinese show no alarm at their recent defeat ; and anyone who thinks their confidence extravagant may find some confirmation for it in the gloomy outlook for Japanese trade. It may be said that if Japan's victories are won on the battlefield, China's consist in the severe shocks given by the war to Japan's economy.
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