[This Document is the Property of His Britannic Majesty's Government.]
CHINA TRADE.
CONFIDENTIAL.
No. 1.
434
[October 13.]
SECTION 1.
C. O.
1 40009
(No. 115.) My Lord,
Sir J. Mackay to the Marquess of Lansdowac.—(Received October 13.)
)--0
2. NOV 02,
Shanghae, September 8, 1902.
I HAVE the honour to transmit herein twelve copies of the English text of the new Treaty, with its annexes.
Since the date of my last general Report to your Lordship on the progress of negotiations, No. 105 of the 16th August, I have had meetings with the Chinese Com- missioners, or their Secretaries, on an average at least once every day.
In the course of these interviews new points were constantly raised, sometimes by one Viceroy, sometimes by another, and old points raked up which were supposed by both sides to have been already settled.
Among these the question of the currency Article came up. Viceroy Liu, being apparently nervous that merchants might claim to substitute the new coin for the Haikwan tael in payment of customs duties, no matter what its value, asked the Com- missioners to send me a despatch in which the Viceroy's view that such action was not contemplated by the Treaty was clearly laid down. In compliance with their Excel- lencies' request, I sent them a reply confirming this view, and I took the opportunity of adding some words which made it clear that free coinage of silver is contemplated in the new currency organization---a stipulation which I was unable to get inserted when the Article was agreed owing to the absolute ignorance and consequent suspicion of the Chinese on the subject.
At their Excellencies' desire these despatches are added to the Treaty as annexes, and therefore the Chinese stand now, to some extent, committed to establish free coinage of silver.
In regard to Article IV, a despatch, translation of which is inclosed, was addressed to me in reply to the note which I sent in in accordance with your Lordship's instruc- tions on the subject of reserving the right of His Majesty's Government to take Diplomatic action. The despatch does not seem to be in any way a bar to such action being taken if necessary, and I have, therefore, let the matter rest at this point.
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Your Lordship will remember that it was settled at Wachang that silk was to pass free through all native custom-houses. Shortly before the final preparations for the signature of the Treaty, I discovered that in the Chinese text the word " been substituted for "silk," owing to the inadvertence of one of Sheng Kung-pao's cocoons bad Secretaries, and that, this word having been submitted to the Throne instead of the word silk," the Chinese were anxious to have the English text made to correspond. At first I refused, but after some discussion a compromise was come to under which only cocoons pass free through the native custom-houses, being liable, though, to full export duty, while silk is to pay, like other goods, 24 per cent. ad valorem at the first native custom-house, but is to get the amount returned at the place of export. Both silk and cocoons remain free from the surtax as decided at Wuchang.
Your Lordship will perceive that, as a result of much tedious negotiation, I have been able to render the safeguards somewhat more stringent against violation of the provisions of the Treaty. The rights of His Majesty's Ministers, for instance, to inter- fere in cases of complaint is definitely recognized by China-an important point, as it is often difficult to get Chinese to take the initiative and make a complaint. indebted to Mr. Cockburn for this suggestion, made to me from Peking when he saw the draft of Article VIII.
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In regard to inland navigation it will be seen that the wording of Rule I is some- what peculiar, as the first sentence alludes to steam-ship owners, and the second to merchants. This is a suggestion of the Chinese themselves, and I have been unable to understand why they did not ask to have the word "merchants" changed to "steam-ship owners" in the second paragraph.
I have myself fruitlessly endeavoured to induce the Chinese to substitute the word "merchants" for " ship-owners" in the first paragraph on account of the former word being more comprehensive.
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