Here is the source where I got the information.
http://www.marshallfoundation.org/pdf/20Yu...ese%20views.pdf"...While Shanxi province was theoretically under the Nationalist government, it was actually ruled almost independently of Chiang Kai-shek by Governor Yan Xishan, who was pro-Japanese. The Japanese staff officers, therefore, expected that Yan would allow the Japanese Army to stay in Shanxi because he needed its help for his battle against the Communists.
Yan Xishan actually tried to utilize the Japanese forces, weapons, and materials. Just after the war’s end, Yan asked General Sumita to transfer Japanese equipment to him and that Japanese troops remain in Shanxi under his command. Sumita initially refused, saying that it was senseless for the Army to engage in hostilities without the Japanese government’s order. Yan pressed Sumita strongly, however, and the general finally agreed, provided that Japanese soldiers were first discharged from military service and then volunteered to serve under Yan. [18] About two thousand Japanese soldiers took part in this program when it was established in the spring of 1946; the last unit fought against the Communists in Shanxi until April 1949. By the spring of 1949, the number of Japanese soldiers had decreased to one hundred, and many of them lost their lives in the final battle. [19]
Although the original idea had been that the Japanese volunteer force in Shanxi would assist Japan’s reconstruction, it was destined to be a deserted force. Neither the Japanese government nor the senior officials of the former Japanese First Army would accept the volunteer activities in Shanxi, because it was a violation of the Potsdam Declaration.
One junior officer who refused to participate in the new army recalled that the staff recruited soldiers systematically, giving enlisted men an exaggerated picture of the misery that awaited them if they returned to Japan. They even created a false pamphlet saying that if the soldiers returned to Japan, they would be sent to a prison in New Guinea as war criminals. [20]
The Japanese government knew of the activity in Shanxi and opposed the volunteer army plan. The First Ministry of Repatriation (formerly the Army Ministry) several times ordered the activities in Shanxi halted and sent an officer, Shun’ichi Miyazaki, to investigate the situation. Miyazaki reported in April 1946 that Yan Xishan was aiming at establishing his own independent kingdom with the help of his Japanese volunteer army. Miyazaki opposed this use of Japanese forces and recommended that the staff officers who insisted on remaining in Shanxi should be transferred elsewhere and that repatriation of Japanese soldiers in Shanxi begin as soon as possible, with the cooperation of U.S. troops. [21] Even Yasuji Okamura, the former commander of the China Expeditionary Army, who advocated cooperation with the GMD army after the Nationalist government moved to Taiwan, objected to the Shanxi project.
United States leaders were also aware, to some extent, of the events in Shanxi province, and regarded it as injurious to the American program in China and to the Marshall Mission. Governor Yan was an obstacle to U.S. policy in China, in part because he did not obey the ceasefire that Marshall had helped to negotiate and continued to battle against the Communists, and in part because he was violating the Allied Powers’ order for disarming Japanese troops. When General Marshall visited Taiyuan 3–4 March 1946, he and the other members of the Committee of Three met some generals in Yan’s army and demanded the disarmament of the Japanese troops. Yan needed the Japanese forces, however, so he and his Japanese officers ignored Marshall’s request. The Japanese troops were camouflaged by officially disbanding them and hiding them in mountainous areas and retaining their organization. [23]
The Nationalist government not only did not support Yan Xishan, it strongly opposed his use of Japanese troops. When Shun’ichi Miyazaki, the Japanese officer investigating the Shanxi issue, met Yan, he found that Yan had refused to implement the directives from Chinese Army Headquarters ordering the disarmament of his Japanese troops. [24] Colonel Ulmont W. Holly, American member of Field Team 3, reported that Yan “repeats the orders received from [Marshall Mission] Executive Headquarters to his Field Commanders, but does not issue directives of his own to see that they are carried out.” [25] This was not the first time that Yan had ignored orders from the national government or Executive Headquarters. The national government had a long history of trouble in dealing with him. Yan, while anti-Communist, was an old-style warlord and not a man who understood the local situation in terms of U.S.-Soviet international rivalry; he merely wished to secure Shanxi.
Yan’s ambitions might fit the old-fashioned Japanese view of “weak and divided China,” but the Imperial Japan that had invaded China with this view no longer existed, and the postwar Japanese government could not recognize his Japanese troop project, making it an abandoned army. Possibly the Japanese officers who advocated this project could have exploited the U.S.-Soviet conflict, but they had no long-range vision of the Cold War and their plan was thus destined to failure. Moreover, the whole concept of the force preserved for Japanese reconstruction was vague and unjustifiable, ignoring as it did Japanese responsibility for the Asian war.
As it became clear to Yan’s Japanese mercenaries that their idea of assisting Japan’s
reconstruction was irrelevant, the officers sought to redefine their role. Hiroshi Jono, the troops’ political adviser, sought to revive the empty argument of an Asian anti-Western coalition. In his memoir, Jono wrote that the Japanese in Shanxi should help to strengthen Yan’s regime first, then let Yan persuade the Nationalists to cooperate with Japan, and subsequently Japan and China could form an anti-Western third-force coalition to exploit the Soviet-American conflict.[26] A reflection of obsolete anti-Western sentiments, his plan was doomed to failure. Philosophically the Japanese effort in Shanxi was a backward-looking amalgam of obsolete views."