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provincial mints, and that it has been found that the proportion of copper in those which have the appearance of copper is very large, some of them consisting of almost pure metal.
In the brass pieces there is in many cases as much as 70 per cent. of copper. But these facts do not indicate that the authorities of the provincial mints are alive to the necessity of uniformity in the coinage.
The Article of the Treaty is thus worded:-
"China agrees to take the necessary steps to provide for a uniform national coinage, which shall be legal tender in payment of all duties, taxes, and other obligations throughout the Empire, by British as well as Chinese subjects."
And the new United States and Japanese Commercial Treaties contain Articles of similar import.
It is an obvious remark that among the ranks of Chinese officials it will probably be difficult to find any functionary possessing the knowledge of currency facts and theories requisite for dealing with this vast and complicated problem, and that the most effectual means of carrying this Article into effect would be for the Powers interested in the reform of Chinese currency to combine in lending the services of the necessary number of experts to study existing conditions, and to recommend what remedies should be adopted.
I come now to the Article regarding the revision of the Mining Regulations. Your Lordship is in possession of Reports relating to the steps which I have taken, under instructions, with the view of urging the speedy execution of this Article. In my despatch No. 204 of the 12th June I inclosed a note from the Foreign Board stating that the revised draft (which is probably that referred to in Sir Pelham Warren's despatch inclosed herewith) might be expected to reach Peking in about a month's time, when it would be taken into consideration by the Boards of Foreign Affairs and Commerce. In the meantime it seems clear that, until the new Regulations come into force, British subjects can carry on mining enterprises in China only under existing Regulations.
The Shanghae letter states that there is no sign of such Regulations as will conform to the requirements of the Treaty. But I am informed that the gentleman who framed the letter was cognizant of the fact that Mr. Broad had completed the draft of the new Regulations. It goes on to call attention to a letter published in the "North China Daily News," in which the British Consul states that British subjects are only allowed to obtain permits to mine under Regulations issued by the Wai-wu Pu, and reference is made to the inclosure marked A. As this inclosure distinctly states that the Consul
in question is His Majesty's Consul at Wuhu, it is right to mention that the British merchant referred to is Mr. E. S. Little, and I inclose copies of the correspondence to complete the extract given in the Shanghae letter. It will be seen that Mr. Ker's letter of the 5th December is not accurately reproduced. A more serious error is the state- ment in Mr. Little's letter of the 12th December, 1904, to Mr. Ker, that clause IX of the Treaty of 1902 gives foreigners exactly the same right to buy and hold land as the natives anywhere in the interior. China has never conferred such a right on foreigners in general, and there is nothing in the clause in question which could possibly be held to justify such an interpretation.
The next point treated of in the Shanghae letter is taxation. It is alleged that although it was provided that Article VIII of the Treaty was not to come into force until all the other Treaty Powers had agreed thereto, China nevertheless, recognizing certain" fundamental principles," engaged to reform and systematize her taxation as far as merchandize is concerned,
The "funda-
This is a complete misrepresentation of the wording and intent of Article VIII. Independently of that Article, China has entered into no "engagement to reform and systematize her system of taxation as far as merchandize is concerned." mental principles alluded to in it are, firstly, that China would discard completely the system of levying fi-kin and other dues on goods at the place of production, in transit, and at destination, with the limitation that she should be at liberty to impose a consumption tax on articles of Chinese origin not intended for export; secondly, that the British Government would in return consent to a surtax on foreign goods imported, and on Chinese produce destined for export abroad or coastwise; thirdly, that no attempt should be made to revive li-kin barriers and other stations for taxing goods in transit, that the surtax should in no case exceed one and a-half times the import duty leviable in terms of the Final Protocol of the 7th September, 1901, that payment of import duty and surtax should secure for foreign imports complete immunity from other taxation, examination, or delay, and that the total amount of taxation on native
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produce for export abroad should under no circumstances exceed 7 per cent, ad valorem.
"Keeping these fundamental principles steadily in view, the High Contracting Parties have agreed upon the following methods of procedure." is the wording of the Article, and it is plain that neither the methods of procedure nor the fundamental principles on which they are based come into operation or receive application until, as stated in section 15, all the Powers shall have signified their acceptance of the engage- ments embodied in the Article.
The cases referred to under Inclosures B, C, D, and E consequently are not violations of the Treaty of 1902, but in so far as the acts complained of are violations of Treaty they must, as stated in Earl Percy's reply to Sir Gilbert Parker's Parliamentary question of the 19th April, be referred to Treaties concluded with China at an earlier date.
It may consequently be inferred that, if the signatories of the Shanghae letter had been at leisure to examine into the statements made under this heading and to compare them with the actual wording of Article VIII of the Treaty of 1902, they would have been disiuclined to append their signatures.
Of the cases cited, Sir Pelham Warren's despatch reports on three-C, D, and F. B and are cases in which Messrs. Brunner, Mond, and Co., for whom Mr. E. S. Little is the agent, are concerned. His Majesty's Consul at Chinkiang has been asked to furnish a detailed report on case B. Case E is that of the British merchant Bennertz, on which reports have been furnished to your Lordship in my despatches Nos. 12 of the 10th January, 107 of the 29th March, 113 of the 5th April, 118 of the 11th April, 142 of the 27th April, 183 of the 29th May, and 233 of the 3rd July, 1905, and the question whether the walled city of Changsha forais part of the port of that name is still the subject of discussion between myself and the Chinese Government. Case A comes under the head of mining, and has already been explained.
The last point is navigation. Mention is made of the fact that as yet no steps bave been taken to carry out the promised works for the improvement of the Huangpu The causes which have led to River, provided for by Annex 17 to the Final Protocol, this delay have been fully placed before your Lordship in a long series of despatches, and I will only observe now that this delay is no case of ignoring the Commercial Treaty of 1902. It is further stated that there is also evident a great reluctance on the part of the Chinese officials to allow the free use of inland waters to vessels carrying a foreign flag, and one case (F) is cited. Two other cases in which the Chinese authorities are opposing the issue of inland water certificates have been reported to me, but there is at present no reason to suppose that they will not be satisfactorily disposed of.
The letter concludes with a statement that the Chinese Government and the officials throughout the Empire are now more obstructive in their treatment of British subjects and trade than formerly, and that there is no evidence of any endeavour to carry out either the spirit or the letter of the Treaty. I think it my duty to say that I do not share this view. Differences of opinion from time to time in regard to the interpre- tation of the Treaties have arisen in the past between His Majesty's Counsuls and the local authorities, and between His Majesty's Legation and the Central Government, but such differences do not appear to me to have recently become more numerous than usual.
It will, however, be for His Majesty's Government to decide, upon a review of the complaints contained in the Shanghac letter, and of the explanations given in this despatch, whether the state of our present relations renders it necessary to bring special pressure to bear upon the Chinese Government in order to insure the observance of Treaty stipulations.
I have, &c. (Signed) ERNEST SATOW.
Inclosure 1 in No. 1.
Messrs. Jardine, Matheson, and Co, and other British Merchants to the Marquess of Lansdowne, My Lord Marquess,
Shunghae, June 6, 1905. WE have the honour to inclose herewith a copy of the cablegram forwarded on the 3rd May, together with a list of the Signatories thereto. The original of this document has been deposited with His Majesty's Consul-General at this port.
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