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9 December 1937- Ignoring orders to "fight to the last man" from Chang Kai-shek, General Tang agrees to surrender Nanking to the forces of General Matsui and Prince Asaka. Agreeing to Chinese terms, the Imperial Japanese Army promises fair treatment for all POWs and for civilians in the city. The Kuomintang Army for its part quickly withdraws to the west, abandoning the city.
The city is occupied. A few isolated atrocities are committed, but are quickly punished by General Matsui, resulting in their decline. The Westerners of the "Nanking Safety Zone" are relatively pleased and report the same to the outside world.
11 December 1937- Three Standard oil tankers are sunk in the Yangtze north of Nanking. However the USS Panay is not there, but downstream, having never been called in to evacuate American personnel from the city. There is no "Panay Incident".
March-April 1938- The Battle of Xuzhou. The Japanese inflict 120,000 casualties on the Chinese, but are still too weak to finish off the Chinese army, many of whom escape into the country. Battle of Taierzhuang. Japanese forces inflict 35.000 casualties while taking some 15,000. Not a clear victory for the Kuomintang (Chinese Army), but some morale benefit is seen.
June-October 1938- The Battle of Wuhan. A massive assault by the Japanese to take the new headquarters of Chang Kai-shek's forces. The defense is led by Chang himself. The Japanese inflict terrible casualties, while taking many themselves. Chemical weapons are used for the first time, creating a resolution of condemnation from the League of Nations.