387281
PRINTER
FOR
EASTERN
No.
88
COLONIAL
USE
OF
OFFICE
Enclosure 1.
(Secret)
My Lord,
Hong Kong.
C. O.
38928
236
Ed. 22 OCT 061
Government House.
11 September
1906
In continuation of my referred despatch of the 6th September on the subject of negotiations for the completion of loan agreement and a joint working agreement in connection with the proposed Canton Kowloon Railway I have the honour to submit for information and record a correspondence with Mr Carnegie, at Peking, as furnishing information,
a paraphrase of further telegraphic correspondence.
2. The date of September 6th referred to in the first of these telegrams is that of a despatch, in which Mr Carnegie had sent to me a copy of one of the previous day in which he had reported on the negotiations to Sir Edward Grey. This despatch to the Foreign Office has already been communicated by the Department to your Lordship. In transmitting his copy of it to me Mr Carnegie added as follows:- "The points stated in your telegram of August 20th are borne in mind and will be brought forward at the proper time. They have been mentioned to Mr (Jordan) who sees difficulties with regard to the introduction of Chinese loan agreement."
3. Article 14 of the loan agreement as drafted in London was designed to prevent, inter alia, the construction of branches of the Kuki-Kowloon line and the invention of a rival railway detrimental to the Canton Kowloon line from Shek O to Canton, which is of special importance now that the Chinese have projected a line which, for 40 miles of its length, follows the course which must be generally adopted by the Canton Kowloon line.
4. I also enclose a letter from Mr Bland and a copy of the minutes of meetings referred to within. The letter shows that there is no opposition on the part of the Corporation's representative towards getting into the loan agreement, stipulations without which I am satisfied that the subsequent conclusion of a satisfactory working agreement will not be possible. For this I must rely on Mr Jordan and Mr Minister at Peking.
5. The minutes show that the Corporation's representative is now disposed to accept terms from the bankers, on the whole inferior to those which were offered in Vienna in June last. Your Lordship will remember that it was decided to obtain at Peking conditions more in accordance with the Chinese Government's undertakings. Mr Bland acted on the suggestion to transfer the negotiations from Canton that had been made to him by the Viceroy who at the time had full power under an Imperial Edict to carry on the negotiations.
I have the honour to be,
My Lord,
Your Lordship's most obedient
humble servant,
M. Nathan
Governor
The Rt Hon
The Earl of Elgin, K.G.
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