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Thus, by means of this Conference, the military federation of the British Empire was established. By its efforts the English squadron in the China Sea and in the Australian seas are more closely connected together than they have been before, and, if needed, the English forces in the North Pacific would be reinforced by Australian troops. We saw an instance of this in the late Egyptian campaign.

One more question remains to be ventilated, viz., whether England is able to secure absolute power in the North Pacific with the naval and military forces she has at her command there, using Hong Kong as the centre of war preparations.

I answer in the negative. It could be maintained only by an occupier of the Island of Formosa, the “Malta” of the North Pacific, which lies between the North China Sea and the South China Sea. Its area is estimated at 14,978 square miles. It has a healthy climate, tempered by the influence of the sea and its mountains. Coal is to be found in considerable quantities, although not of the best quality. Its natural products are plentiful, such as sugar, tea, and rice. It possesses several good harbours, one of which, Tam-sui, or Howei, is surrounded by hills upwards of 2,000 feet high, and has a depth of 3½ fathoms with a bar of 7½ feet.