(This Document is the Property of His Britannic Majesty's Government.
CHINA TRADE.
CONFIDENTIAL.
302
[August 31.]
SECTION 2.
No. 1.
Mr. Townley to the Marquess of Lansdowne.-(Received August 31.)
(No. 260. Confidential.) My Lord,
Peking, July 6, 1903. WITH reference to your Lordship's despatch No. 140 of the 18th May last, and to my telegram No. 172 of the 3rd instant, upon the subject of the proposals made to your Lordship by the liquidator of the affairs of the Bank of China and Japan, that the Chinese Government should be invited to make a payment on behalf of the Chinese shareholders who are in default, or that the matter should be submitted to arbitration, I have the honour to report that as the result of a private conversation I had recently with his Excellency Na Tung, I am of opinion that there is small chance of our persuading the Chinese Government to make any sort of compromise.
Na Tung, who as your Lordship is aware was recently a Vice-President of the Foreign Board, has now left that office on his promotion to be President of the Board of Finance. He is, therefore, well suited to give an opinion upon such a case as the one in point.
It being undesirable to raise the question officially, I put it before him privately at a visit I paid him the other day. He said that he himself was never directly concerned in the case while he was at the Wai-wu Pu, but he had often heard the other members of the Board discuss it, and the impression which had remained upon his mind was that they were very decided indeed that no action could be taken by this Government against the Chinese shareholders. Under such circumstances, his Excellency said there was small chance that they would listen to the proposal that they should pay a lump sum down and recover their liabilities from the Chinese shareholders.
For the above reasons I am not of opinion that any good purpose would be served by reopening the case with the Chinese Government, nor do I think that the latter would be willing to agree that the case be submitted to arbitration.
I have, &c. (Signed) WALTER TOWNLEY.
No. 2.
(No. 264.) My Lord,
Mr. Townley to the Marquess of Lansdowne.--(Received August 31.)
Peking July 15, 1903. WITH reference to Mr. Scott's despatch No. 21 of the 24th June, of which he has transmitted a copy to your Lordship, reporting the establishment at Kan-chou, on the border of Kiangsi and Kuangtung Provinces, of an office for the collection of a tax on opium, I have the honour to state that I addressed the Foreign Board on the 7th instant, inviting them to telegraph instructions for the withdrawal of this station, as being evidently intended to exact from foreign opium an illegal contribution. To this representation I yesterday received the letter of which a translation is inclosed, declaring that according to the system in force in Kiangsi, which has received the sanction of the Board, a tael of silver is levied on every 100 taels of opium, and that this tax is not paid by foreign opium while the packages containing it are intact.
As reported in my despatch No. 231 of the 18th June, I wrote to the Board on the 16th June, pointing out that before any tax is imposed on foreign opium, in addition to the import duty and commuted li-kin levied by the Customs authorized, it must be shown that native opium bears an equal burden. To this the Board have made no reply, and from their present letter it is tolerably clear that they intend to take up the position that they are free to tax foreign opium at any rate they please,