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TRANSLATION.
I am glad to give you an account of the development of events in China since my stay here a year ago. 
2. Months
This development may be summed up thus: our nation has grown more self-conscious, its leader more beloved, its army more disciplined and its finances more stable; more is known of Japan and the problem of the Far East is understood better in other countries.

The first result of our hardships has been to give our people a deeper sense of their national duty. In the country districts, the peasants - men and women alike - whose ideas were bounded by the village, or province at most, offer their children voluntarily for military service, and though lacking education, they find spontaneous and most moving expressions for defining their duty: "though we cannot all fight for the Motherland, at least we should suffer with her and for her" this is their watchword and typical mentality. China herself has become a reality to them and they realise that the Nation's Cause is just and good. The Japanese claimed to wage a "sacred war"; but while their people have grown indifferent to this term, it is increasingly thrust upon our own people who relise that, without armed rosistance, all is lost for us and that our aims are loftier than mere national interests and assume the noblest and most vital character; we are fighting and suffering for Justice itself, for the preservation of the principles of common Right and Humanity and the protection of the Law of Nations. This conviction increases in each one of us our confidence and certitude of victory. Faith in the lasting victory of Truth and Goodness gives us, together with optimism, the courage and strength to undertake whatever sacrifices our Country demands of us.

Because he accomplishes and exceeds all that a National expects from its leader, the Head of the Chinese Nation is obeyed with daily increasing respect and love. Chiang Kai-shek has come forward as the protector of the people and the foremost champion of the Nation's rights, and everywhere, down to the women and children, he he is venerated and beloved by all.

There is no better proof of this unanimous attitude than the reception accorded to Mr. Wang Ching-Woi at the time of his recent spilt. He was the chief personality in the National Party after the Generalissimo, and he anticipated that his proposals would have had the necessary influence to attract a substantial part of the country to his following. On December the 26fh, Chiang Kai-shek refuted and refused point by point the calls made by Prince Konoye. This speech sufficed. When five days later, Mr. Wang Ching-Wei spoke for the opposition, he met with absolutely no response. 

At every turn in the present war, on the fall of each big city lost, every renewal of Japanese propaganda has encountered a similar set-back: one word from the Generalissimo has sufficed to leave no one in doubt as to their duty. Chiang Kai-shek, at the very outset of hostilities, had described the course which these would pursue and the extent of the sacrifices entailed. In his opinion, losses of town and retreats from the front had no decisive importance, but he intended above all to conserve the vital military forces of the country so as to be able to fight to the end, and he intended each retreat to be the evacuation of all the supplies and personnel responsible for assuring to the services in the rear the continuity of the tremendous role they shouldered. He fulfilled what he proclaimed and event have occurred as he foretold.

Now, at the opening of the second phase of the war, he possesses a wider confidence than ever, which all his actions merit. He is a man of few words only concerned with achievements. Before him all parties fade away. The whole of China has found in him the actual symbol of her national unity.

I have just mentioned the army. After a year and a half of campaign, it is more vigorous than over. No mishap or retreat impairs wither its strength or morals. At the beginning of the war the Chinese lost 30 men to the Japanese 10: the proportion has been notoriously modified; at present, when the Japanese lose 10 men, we lose 8. At the beginning of the war we had 140 divisions each composed of 10,000 men; we now have 200, and added to these, there are the troops engaged in guerilla warfare who total four million; the latter cost public funds very little, being generally fed and armed at the expense of the enemy they plunder.

The Chinese Army consists of increasingly good cadres. Practice makes perfect. Recent months have seen the return to the front of 250,000 soldiers, wounded and cured, who rejoined the fighting units, reinforcing their cadres and contributing valuable practical experience.