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This telegram supplied the material for a Parliamentary question addressed by Sir Gilbert Parker to the Under-Secretary of State for Foreign Affairs on the 19th April. Earl Percy replied:--
"No information of the acts alleged in the question has reached us.
Such acts would be violations, not of the Treaty of 1902, but of Treaties concluded with China at an earlier date. His Majesty's Minister at Peking has been informed, in reply to his inquiries as to the steps which had been taken to carry out the provisions of Article II of the Treaty of 1902, that the Office of Financial Administration has presented a Memorial to the Throne proposing the establishment of a general Mint at Tien-tsin for the coinage of silver and copper and the introduction of a uniform national coinage, As soon as definite arrangements have been made they will be communicated to Sir E. Satow, With regard to the Mining Regulations, the Chinese Government state that Regulations have been drawn up, but that it is necessary to consult the provincial authorities before the final arrangements could be settled."
On the 20th April a Reuter telegram was sent out from London, and in due time published in Shanghac, which ran as follows:----
"Lord Percy said that no information had reached the Government as to China having ignored the terms of the Mackay Treaty."
Three days later a letter signed "E. S. Little" was published in the "North China Daily News," of which I beg to inclose a copy. I beg to call your Lordship's attention to the opening sentences of this letter, inferring on the authority of the Renter telegram that the British Government is absolutely ignorant of the existing state of affairs in China. If His Majesty's Minister to China and the Consuls have reported home the number of cases of Chinese evasion of Treaty obligations the Government will be unable to state with truth that no information has reached the Government as to China having ignored the terms of the Mackay Treaty. If British officials in China have not informed the Government, it is high time the British mercantile community should step in and supply the necessary information to our badly-informed Government."
The remainder of Mr. Little's letter to the paper is in great part an anticipation of the statements contained in the letter of the Shanghae merchants to your Lordship.
In pursuance of the desire expressed by your Lordship that I should furnish my observations on the questions raised by the signatories of the telegram, I have the honour, with regard to the general statement that China ignores the Commercial Treaty, to point out that of the fourteen Articles which it contains the following have been fulfilled since the exchange of ratifications took place on the 28th July, 1903, or are in process of fulfilment,
I. Drawback Certificates.
In regard to this Article a difference of opinion occurred between the Taotai and His Majesty's Consul-General, but representatious were made to the Chinese Government by His Majesty's Legation which resulted in its removal, and no further complaint has been received.
V. Removal of artificial obstructions to navigation in the Canton River. Reports on this subject were forwarded in despatches Nos. 135 of the 21st April, 144 of the 24th April, 168 of the 12th May, and 389 of the 15th Novem- ber, 1904, besides others sent direct to your Lordship's Office from His Majesty's Consulate- General at Canton.
VI. Bonded warehouses.
See my despatch No. 12 of the 13th January, 1904, and inclosure.
VII. Trade-marks.
It cannot be fairly alleged that China has neglected this question, or neglected to make proposals for the enactment of a trade-mark law, as the voluminous correspondence between your Lordship's Office and His Majesty's Legation sufficiently proves.
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X. Inland Navigation Rules and opening of Kongmoon.
Reports were furnished in despatches Nos. 18 of the 18th January, 45 of the 2nd Feb- ruary, 128 of the 12th April, 130 of the 13th April, and 416 of the 7th December, 1904. The ports of call and passenger stations mentioned in this Article were all opened by the 1st March, 1904. The question of licensing launches to run to Nanning and Posé is still a subject of discussion with the Canton Viceroy.
XIV. Interport transport of rice.
After some correspondence with the Chinese authorities, the export of rice was allowed from Chinkiang under certain limitations, which, though contrary to Treaty, were accepted by British merebants. I inclose an extract from Mr. Tratman's Intelligence Report for the March quarter 1905, bearing on this question. On the 23rd September, 1903, the Governor of Hunan was informed by His Majesty's Acting Consul-General at Haukow that a limited permission to Messrs. Jardine, Matheson, and Co. and Messrs. Butterfield and Swire to export rice from Changsha would be accepted as a temporary measure only, and that we should insist on our Treaty rights.
In regard to Articles III, duties and li-kin levied on goods carried from Hong Kong to the Treaty ports in the Canton Delta, and IV, obligations of Chinese shareholders in foreign Companies, no questions have arisen.
Articles XI, XII, and XIII contain undertakings on the part of His Majesty's Government of which occasion for fulfilment has not yet presented itself.
The execution of Article VIII, abolition of li-kin and substitution of a surtax on imports, depends on the adhesion of all the other Treaty Powers,
Articles II, the establishment of a uniform national coinage, and Article IX, the revision of the existing Mining Regulations within twelve months from the 5th September, 1902, have not been carried into effect.
Proceeding to comment on the points raised in the Shanghae letter, it may be observed that to reform the currency system of China so as to bring it into conformity with that prevailing in most civilized countries is a task of considerable magnitude, and the negotiators of the Treaty wisely fixed no limit of time within which it must be accomplished. The existing system has been described in great detail in two articles which appeared in the "Times' Financial and Commercial Supplement" for the 13th and 20th March of this year, and the obstacies to reform are very well stated by the writer. Not long after the Mackay Treaty was signed the United States, at the request of Mexico and China, appointed a commission of experts to confer with leading European financial authorities, official and non-official, with regard to the best method of harmoniz- ing the currency systems of these two silver-using countries with those of the countries which possess a gold standard. In 1903 they reported, and early in 1904 Professor Jenks, the most prominent member of the American Commission, paid a visit to China, in the course of which he discussed with the leading authorities, both provincial and metropolitan, an elaborate series of proposals for the regulation of Chinese finance and the adoption of the gold standard. Reports of his proceedings appeared in the local press, and at one time there seemed no small reason to hope that he would succeed in his endeavours, The Chinese Government, however, eventually decided against the acceptance of Professor Jenks' plaus, and resolved to begin with the reform of the copper
currency.
A sketch of the proposed course of procedure, as given by the Chinese Minister for Finance, was contained in my despatch No. 150 of the 2nd May to your Lordship. In that despatch I mentioned the apprehensions entertained by foreign business men with regard to the apparently unrestricted coinage of the new 10-cash copper piece. The Chairman of the Shanghae General Chamber of Commerce has since addressed to the Diplomatic Body a letter, giving information with regard to the provincial copper mints, and pointing out the danger of depreciation of the new coin. To this letter a reply has been sent asking for further and more precise details. A copy of this correspondence is inclosed, and it is probable that a representation on this subject will be addressed to the Chinese Government by the Diplomatic Body. It is also reported that the Board of Revenue is alive to the necessity of controlling the issues by the provincial mints, and I have the honour to inclose translation of a Memorial on this subject, which, though not going as far as could be desired in the direction of supervision and control, is still a considerable step in advance.
In the meantime it may be noted that the "North China Daily News" of the 6th July states that a careful analysis has been made of 10-cash pieces from various