Bleeding them out is something Makif can ill afford. Bleeding them out means focusing a big chunk of his pittance of an IC on land warfare, when he should be churning out flattops, cruisers, and an airforce.
Getting bogged down in China means he can not strike Indochina/Singapore/India the month he declares war, and that is baaad.
Also, try to concentrate on their INF divisions. Wear them down, bomb them out, circle them in, whatever you must do. China has rather few INF (compared to the sea of MIL), and once you break those, its much, much easier.
Hopefully the loss of industrial capacity will prevent the Chinese from reinforcing their divisions. Eventually, you'll bleed them out.
The situation in the North is worrying. Anyang must be totally devastated by now, is there any infrastructure left in the province?
I doubt that they will surrender in 1939, but it should be possible to beat them by 1940, unless the mountainous terrains prevents you from advancing further.
That's about 30 divisions. The Chinese don't have the means to replace such losses. They are not dead yet, though, so you need to capture more provinces.
Go Japan, kick some ass!
Good job with the encirclement. When I first saw the situation at Ji'an, I thought "I hope he attempts a great southern encirclement using the salient as a springboard." And you did exactly what I would have done
Now, 30 divisions is a lot. The Chinese will have to redeploy troops to strengthen the front in the South, which should allow you to steadily advance towards the remaining industrial regions of China and finish it once and for all.