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[This Document is the Property of His Britannic Majesty's Government.]

CHINA TRADE.

CONFIDENTIAL.

[29595]

No. 1.

[August 31.]

SECTION 1.

Mr. Carnegie to Sir Edward Grey.-(Received August 31.) (No. 161.) (Telegraphic.) P.

CUSTOMS in Manchuria.

Peking, August 31, 1906.

In accordance with the instructions contained in your telegram No. 153 of the 23rd instant, I addressed a note to the Chinese Government, in which I pointed out that an unfair discrimination was being exercised against a long-established Treaty port by the present state of affairs. I have received a reply from the Wai-wu Pu to the effect that negotiations have been commenced with the Russian and Japanese Governments for the establishment of custom-houses in South and North Manchuria; that the Chinese Government cannot entertain the grounds adduced for making Newehwang a free port; and that they do not see their way to doing so in view of the fact that the customs revenue of that place is involved in the indemnity due to foreign

Powers.

I have repeated the above to His Majesty's Ambassador, Tôkið,

[2105 kh-1]

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