ISOLATION.

Sir,

268

Viceroy to Dr. Scott.

CANTON, 6 January, 1906.

I have the honour to acknowledge receipt of your letter of the 4th instant regarding the Canton-Samshui Railway, recapitulating the instructions you received from H.B.M. Minister in Peking.

With reference to this Railway, it was decided that it should be built by British merchants on behalf of China. Sheng, the Director-General of the Railway Administration, only entered into a Draft Agreement with the Representative of Messrs. Jardine Matheson & Co. and of the Hongkong & Shanghai Banking Corporation, an arrangement which has absolutely nothing in common with a Final Agreement.

But even with regard to the Draft Agreement itself, it lays down that if afterwards, in consultation with the Viceroy and Governor of this Province, any difficulties be met with, it shall be amended accordingly. It really cannot be considered a final settlement.

My former proposal that each build its own line and when completed join the rails for through traffic, was actuated by a sincere hope of seeing its early completion, so that our neighbourly relations may increase in friendliness.

In words of a public nature, one cannot ignore the situation, nor fail to reckon with public opinion.

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