Beautiful day. Approved budget estimates of $250,000,000 for southern Kweichow, to be submitted to the Executive Yuan for approval, as well as a plan of organization. Hu 【胡可時] submitted supplementary estimates of $59,000,000 for office buildings and equipment, and I approved them for submission to Executive Yuan. Captain Emery came to lunch; Bell was supposed to come with him, but died of an accident. Told Emery that I had, for many years, favored close relations with England, because China’s future development needed the co-operation of the U.K. and because the U.K. could be counted on to be a loyal comrade in building up a better world. I saw no major conflict of interest, but I thought that there were two sources of trouble. One was Hong Kong: while I wanted Hong Kong back, I valued British friendship above Hong Kong. The other was the mentality of certain die-hards who regarded us as being inferior. Churchill was not free of such prejudice. Emery asked me about Malaya and India; I said we had no other interest in Malaya than fair treatment of our fellow-countrymen there. As to India, I knew no more about its future than many Indians. He inquired about Russia. I said we wished to do our best and most to achieve good relations, but the future is a big question mark. He asked what the U.K. could do. I said, (1) to get Russia to play ball with us, for example, in Korea, (2) support the present government politically. He was much interested in agrarian problems and in development of capitalism. Seemed to me to favor a bold policy for China. At 2, spoke to staff on the work of CNRRA 【行政院善後救濟總署]. Dinner with the Belgian Ambassador.