153
300
152
li-kin that can be made sure of once the drug emerges from the port area, a 40 tael rate- would be liberal. I was prepared for an invitation to recommend Her Majesty's Govern- ment to go as far as 50 taels. But we did not reach this point. The Grand Secretary, acting, I thought, under instructions from Peking, suddenly became, to all appearance, indifferent to further prosecution of the negotiations.
I had hardly returned to Peking when my colleague the Minister of Germany, the revision of whose Treaty was still incomplete, invited me as Doyen to call together all the Representatives of Treaty Powers for a Conference upon the inland taxation of trade, import and export. We were also to consider other questions affecting our Treaty relations with China, but the question of trade is that to which alone it is necessary to refer at this moment.
I had myself made it a condition with the Tsung-li Yamên, before I took on me to declare the Yun-Nan affair closed in 1876, that the foreign Representatives should be invited to take up the whole of these questions. The Yamên did issue its Circular note, but without result, and I was to a certain extent in a position of disadvantage vis-à-vis the Yamén, as it was thus enabled to contend that every condition affecting trade that I had required of the Chinese Government, in the Chefoo Agreement, bad been satisfied, while on our side nothing had been done. Nor would it admit that Her Majesty's Govern- ment was in any way hampered by the objection of foreign Governments to the commercial clauses of the Agreement. The Minister of Germany had demanded removal of the li-kin Collectorate from the Shanghae settlement, on the ground that its action was in contravention of Treaty. But the Yamén persisted in maintaining that this demand, so far as Shanghae was concerned, was based upon a virtual acceptance of the Chefoo Agree- ment, against which, as I have said, the Minister of Germany and others of my colleagues were at the very time protesting.
The demand referred to had been coupled with an intimation from the Minister of Germany and his colleagues, that no objection would be made to the levy of li-kin on opium within the settlement of Shanghae; but of this I was not aware until nearly a twelvemonth had passed. The Yamén never alluded to it, and I was first informed of it by the Minister of Germany himself, in the course of a conference upon the general trade last year.
The
Let me say here that I regard this concession to the Chinese, if concession it may be called, as a perfectly legitimate concession on the part of my colleagues concerned. Chinese, in my opinion, had as much right to lay a li-kin on opium in the settlement or any larger port area, as they had no right to lay upon other articles of the import trade. I merely mention it here as part of the history of the case, and as an incident, no doubt, that added to my embarrassment as a negotiator. I was not cognizant of it, for instance, for months after the conclusion of the discussion recorded in the correspondence laid before Parliament in 1880 (sec" China No. 2"), in which I agreed to recommend, as an experiment, the collection of li-kin, together with Tariff duty, at the single port of Shanghae for a term of five years.
made.
·
This last-named arrangement came to nothing because I could not obtain satisfactory information either as to the amount of li-kin it was proposed to collect in the first instance, or the area of exemption from farther taxation after the first payment had been
The year 1880, though not wholly lost to trade discussion, was much taken
up with matter of graver concernment, Still I continued to confer with the Chinese Ministers of the Tsung-li Yamên, both on the subject of the general trade in imports, and of the opium
trade.
The formal engagement of the American Government to prohibit all participation in this trade to American citizens, as soon as I heard of it, gave me occasion to put questions regarding the possible treatment of the trade by China. The answer, which was to the effect that neither legislation in China, nor diminution of the import from India, would lessen consumption, that in the remoralization of the individual Chinese lay the only chance of Chinese recovery, I telegraphed to your Lordship in January 1881. read in the House of Commons by the Marquis of Hartington.
It was
The arrival of the Grand Secretary, Tso, somewhat later, proved a fresh point of departure. He is a man of undoubted energy and tenacity, and his career during the last twenty years, either against rebels within the frontier, or revolted colonists beyond it, has gained him with all Chinese of the old school a high reputation. In the two provinces of Shên Si and Kan Su, of which he was Governor-General, it was his boast that he had made a successful crusade against both poppy cultivation and opium smokers, and in one of his first interviews with me he declared that he had suppressed at least nine- tenths of the production and consumption of opium within his jurisdiction. This is not quite
}
borne out by travellers who have recently visited those far-off districts. It is undoubted at the same time that his treatment of offenders against his interdict was rigorous in the
extreme.
His Excellency appeared to me none the less to approach the opium traffic on its fiscal rather than on its moral side, although the latter occupied, indeed, the more advanced place in his argument. He denounced the trade in the severest terms; but while insisting, as most Chinese statesmen, when speaking of opium, do insist, that extinction of the foreign trade in opium must precede extinction of the native trade in it, and that to this end such taxation must be laid upon it as will render its price all but prohibitory, he cer tainly let me see that he was not indifferent to the revenue which, with high taxation, he hoped might be derived from it. The fair thing, he argued—and it is not a new argument in China--the fair thing, on the part of the Indian Government, would be to divide its enormous profits on the opium sales with the Chinese Exchequer, share and share alike. And while affirming stoutly that as the trade had been put down in his jurisdiction, so it might and should be put down in all provinces of China, he more than admitted that native opium was regularly taxed. "Would such and such an arrangement regarding Indian opium work " I asked his Excellency. By no means," he replied; "we should then lose the revenue on native opium."
44
I am here summarizing very briefly what fell from the Grand Secretary Tso on more than one occasion, before the reappearance on the scene of his distinguished colleague the Grand Secretary Li, who paid a visit to Peking in the month of May 1881.
By their own invitation I met the two great Ministers together at the Tsung-li Yamên, when his Excellency Tso, repeating much that he said before, proposed as a uniform rate of li-kin the addition of 120 taels to the Tariff duty of 30 taels. This, I was informed, was an abatement; he had originally proposed 150 tacls li-kin.
We did not meet after this. His Excellency addressed a Memorial to the throne, in which he represented me as having shown great impatience and shiftiness. He allowed his paper to appear in one of the Shanghae native journals.
I thought it right to challenge some of his statements about myself. I inclose copies of our correspondence, also a translation of his Memorial more carefully prepared than that which has been published in the native prints.* It is noteworthy that in this Memorial he speaks of the rate of 40 tales li-kin originally proposed by me as but a slight rise upon the rates of collection already ruling. In the Chefoo Agreement, be it remembered, I had only tried to secure to China what she was receiving on opium.
His Excellency Li proved less exacting. He began, however, with a rate of 120 tacls; this he subsequently reduced to 110 taels.
I was much pressed to name a rate myself; I declined. If it rested entirely with me, I said, admitting, as I did, that we owed China something under the Chefoo Agreemont, I should be for an increase of the Tariff duty by one-half, the native Collectorates being left, as in time past, to get in the li-kin as they might. This arrangement, I had reason to think, would be more acceptable in the provinces than collection of a high rate of li-kin by the Customs Inspectorate. The Provincial Governments have, lawfully and unlawfully, an interest in the collection by native offices, which cannot fail to be prejudiced by the more regular intervention of the foreign Inspectorate. The revenue collected by the latter, again, may be said to stand rather to the credit of the Central Government, although it is not practically absorbed by it. These were accepted conclusions which were supported by the observations of the Grand Secretary Tso in my first conversation with him, when he declared that any system that might interfere with the collection inland of li-kin or similar imposts could not fail to discontent the Provincial Governments.
My proposal, if it could be called one, to present China with a half duty, and there an end, did not meet with much encouragement. A general doubt was expressed that Her Majesty's Government would consent to it. Some attempt was made at the same time to make light of it, although I showed that, taking the opium import of 1878 as an average, it would add 1,000,000 taels to the opium revenue receipts.
A high li-kin rate secured by the foreign Inspectorate was the favourite, and had the Chinese Ministers at the conference referred to adhered to what I had privately learned was their intention, of proposing 60 taels as the uniform rate, 1 should have recommended this to the consideration of Her Majesty's Government at once.
I have omitted to observe that there was an important difference between the systems previously examined and that here under discussion. We had so far been dealing with rates that were to clear opium of li-kin at the ports only, the li-kin inland being still to be
Copies of correspondence (Nos. 7-9) with the Grand Secretary Tso have been left in Peking, and will be forwarded by the next mail.
2 R
[1703]