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carried into effect it seems probable that a monopoly of the trade of at least Southern Yunnan, including the capital, will fall into French hands.

But on the subject of the trading possibilities of Southern Yünnan and Western Kwangsi, and the condition of the population, we possess little beyond the vaguest knowledge, for which reason I have already ventured to suggest that a Consular officer might very profitably be instructed to proceed to those districts and to report upon their commercial condition and capacities, for the information of Her Majesty's Government.

I have, &c. (Signed) N. R. O'CONOR.

P.S.--I have the honour to forward to your Lordship herewith the Reports of Messrs. Gardner and Allen, referred to in the preceding remarks.

N. R. O'C.

Sir,

Inclosure 1 in No. 116.

Consul Gardner to Mr. O'Conor.

Canton, August 5, 1885. I HAVE the honour to acknowledge receipt of your despatch of the 24th June, directing me to furnish you with remarks on the effect of the commercial stipulations (Articles V and VI) of the Treaty recently concluded between France and China upon the trade, viâ Canton, with the inland markets of Kwangtung, Kwangsi, and Yunnan, and how far I considered the opening of a Treaty port on the West River-as, for instance, Wuchow-would counterbalance the advantages secured to the French by the present Treaty.

I crave your indulgence as to the time I shall be able to forward the detailed Report, with Maps, I am now preparing, and only venture at present to lay before you certain views formed on the broader and more prominent facts.

I do not think the stipulations alluded to will have an appreciable effect on the trade, via Canton, with the inland markets of Kwangtung, Kwangsi, and Yunnan, and I am inclined to believe that the opening of a Treaty port on the West River-say at Wuchow would counterbalance the advantages secured to the French by the present Treaty.

The inland trade between Kwangtung and Tonquin is insignificant; it is a very small interchange of commodities between the Lien-chow Prefecture in Kwangtung and the Quangyen Province in Tonquin. The Quangyen Province is sparsely inhabited, mostly by Hakkas, whose wants are simple; the few Manchester and foreign goods they consume will, I think, as hitherto, reach them neither from Canton nor the French ports in Tonquin, but from Hong Kong, Macao, and Pakhoi.

As to the inland trade between Kwangsi and Yunnan, I have not yet ascertained how far the Thai-ninh, or Langson, River is navigable. It is navigable, at all events, to Kwang-li-chiao, just above Bac-li. General Mesny informs me that it is not navigable even to Langson. Above Langson the country is but sparsely populated.

The populous south-west corner of Kwangsi (comprising the Prefectures of Tai-ping Nan-ning, Chin-ngan, Tien-chow, and Sz-ngan) will, think, continue to receive its imports by the West River from Hong Kong, Macao, and Pakhoi, and will discharge its exports via Canton. A southern branch of the West River* navigable to Lung Chou, and from thence foreign goods are imported into Tonquin through the duty station on the frontier called Chên-nan Kuan.

As to the inland trade between Tonquin and Yunnan, I do not think that for many I doubt whether it will ever be as years to come it will assume important dimensions. great as the French expect. The Yunnan Province is not densely populated, and I do not consider that more than a portion of its trade is ever likely to pass through Tonquin.

A great portion of Yunnan is mountainous and sterile. General Mesny informs me that many of the plains are uncultivated, and covered with jungle or long grass. The principal crops are grown on terraces of the lower hills. The towns of Yunnan are neither numerous nor very populous. The great wealth of the province consists in its mines of galena, copper, tin, &c.; these mines are not at present fully worked. Even if the bright hopes the French entertain as to the mineral wealth and future large population are realized, this will not injuriously affect Canton; while Hong Kong, Macao, and Pakhoi will be able to compete favourably with the French ports in Tonquin in supplying, by way of the West River, such increased population with the commodities it requires.

* The Tso River, an affluent of the Nge-yit River, which latter is the southern branch of the West River.

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