[This Document is the Property of His Britannic Majesty's Government.]
SOUTH-WEST CHINA.
CONFIDENTIAL.
No. 1.
0.
May 19566
RECE SECTION
MAY 05'
Acting Consul Litton to the Marquess of Lansdowne.-(Received May 13.)
(No. 5.) My Lord,
I BEG to submit some extracts from the last Intelligence Report for this Consular district.
Teng Yueh, April 15, 1905.
I have, &c. (Signed)
G. LITTON.
Inclosure in No. 1.
Extract from Intelligence Report, Teng Yueh, April 15, 1905.
Decline in Trade; Opium Transit.-After a decline in the last quarter of 1904, the Burmah-Yunnan trade shows a fall of no less than 22 per cent. in the first quarter of 1905 as compared with the corresponding quarter of 1904. None of the usual causes of commercial depression in China are present to account for this, and it is notoriously due to the prohibition against the transit of opium across Burmah, combined with the fact that the opium crop of West Yunnan cannot for the time pass freely by any other route, owing (1) to the disturbances in Kwangsi, and (2) to the sudden and enormous increases in inland dues in all the provinces of transit, Yülunan, Kwei Chou, Hanau, and the two Kwangs. The result is that the merchants are holding up their stocks of the drug, which is the same as saying that they are holding up the capital with which they would otherwise buy foreign goods from Barmah, for opium is the only considerable product of West Yunnan suited for export.
A consequent fall of 22 per cent. in our trade should satisfy even the ultra- protectionists who believe that India is to find her profit in totally prohibiting the passage of her neighbours' only export. The situation now is such that the West Yunnan merchants would be glad to take their opium across Burmah, and so by sea to Canton, and there pay duty on it to the Customs at the heavy rates levied on foreign- i.e., Indian-opium, and they inform me that Central Yunnan opium is passing vin Mengtse and Tonquin to Canton under these conditions, but I have written to inquire if this really is the case.
Meanwhile the li-kin have overreached themselves, and are not able to get in their revenue. The Teng Yuel and Yung Chang collectors are in despair. No doubt after a time the inland dues will be again reduced, or Kwangsi will be partially opened and the trade resume its ordinary course, but not until a serious blow has been struck at our import trade.
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In articles on trade with Persia, T have often read denunciations of Muscovite wickedness in closing the Batum-Caspian transit route to foreign trade. But what the British are doing as regards West Yunnan opium is even worse.
Russia prevents foreign goods reaching Persia across her territory. We prohibit the produce of one part of China reaching the consumers thereof in another part of China. The whole thing is not only injurious to our trade in practice, but it is unfair to the Chinese in principle, and it is not to he wondered at that merchants in West Yünnan feel strongly about the matter, and ask whether we really care as much about free and fair trade as we profess. They have recently sent a Petition to Yunnan-fu and to the Wai-wn Pu pointing out the disastrous results to them of the present block, and asking that measures of relief should be adopted. They use the old Chinese argument that, their opium being stopped, their silver, which is their life-blood and the true wealth of the country, is flowing out into the hands of the avaricious foreigner.
So long as the present policy in Burmah is maintained, His Majesty's Govern- ment must be greatly hampered in considering the important question of a railway or a road into Yunnan, for it is impossible to say what the potentialities of the Burmah- Ytinnan trade are, unless it is given a fair chance.
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