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372A 2 Republic or to the Chinese Nationalist authorities. It has been suggested that the Japanese Peace Treaty meant that the parties to the Peace Treaty, other than Japan, had become co-sovereigns of Formosa. This seems doubtful. The Peace Treaty merely removed Japan's title without making any alterations in the existing arrangements for its administration.

3. Formosa and the Pescadores are, therefore, in the view of Her Majesty's Government, territory the de jure sovereignty over which is uncertain or undetermined. In the meantime, Her Majesty's Government do in practice recognise the Chinese Nationalists as the authority administering Formosa; but they do not recognise them as the de facto government of Formosa, whether as part of China or on any other basis, since they do not regard Formosa, as such, as constituting a separate State.

4. The logical corollary of our view as to the basis on which the Chinese Nationalists occupy Formosa is that although they are entitled to be in Formosa, they exercise a limited authority there. As we do not recognise the Nationalists as the Government of China, they are not, in our view, entitled to use Formosa for trying to get back into the mainland of China. Their powers in respect of Formosa are, or should be, strictly confined to administering Formosa itself and not using it as a base for outside activities.

5. On the future of Formosa, Mr. Morrison when Foreign Secretary in the late Labour Government, took the line in the House of Commons on May 11, 1951, that it had now become "an international problem in which a number of nations apart from those signatory to the Cairo and Potsdam Declarations are closely concerned" and which could usefully be considered by the United Nations at the appropriate time. The Prime Minister said in the House of Commons on February 1 of this year that "the problem of Formosa [had] become an international problem in which a number of other nations are closely concerned."

The Coastal Islands

6. The Nationalist-held islands in close proximity to the China coast are in a different category from Formosa and the Pescadores, since they are undoubtedly Chinese territory and therefore, in our view, part of the territory over which the People's Republic of China is entitled to exercise authority. Any attempt by the Government of the People's Republic of China, however, actually to assert its authority over these islands by force would, in the circumstances peculiar to the case, give rise to a situation endangering peace and security, which is properly a matter of international concern.


 * 7th February, 1955.