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

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The Chinese local authorities agree to carry on or complete all public building operations effected, or planned but not yet effected, by the Japanese Military Administration.

3. By the third Article of the Peking Memorandum, "the control of the police and the preservation of order shall revert to the Chinese local authorities, who are expected to fulfil the duties connected therewith in the manner most beneficial to the public peace. Japanese police and medical officers shall be employed to assist in the performance of these duties, and the Japanese Consul shall be free to point out defects as occasion arises to the local authorities for their consideration." the two countries have now arranged that, except as regards salaries, the regulations The Deputies of for the employment of Japanese police and medical officers shall be in all respects the same as in the case of the employment of Japanese police and medical officers at Tien-tsin. If defects should hereafter arise in the management of the police or the preservation of order, the local authorities shall, on being informed by the Japanese Consul, take them into consideration.

1. The Chinese local authorities shall not hold a new trial of any causes deter- mined by the Military Administration. The Court records and notes in these causes shall be handed over by the Military Administration to the local authorities for preservation in their archives; and the Military Administration shall also take a copy of them for preservation in the archives of the Japanese Consulate at Newchwang.

5. The fourth Article of the Peking Memorandum provides that "the control of the Imperial Maritime Customs and Native Customs shall revert to the Customs Taotai. The Chinese Government shall for the time being deposit the receipts of both Customs establishments in the Yokohama Specie Bank until a branch of the Board of Revenue Bank is cstablished, when the receipts will be deposited in both Banks"

It has now been arranged by the Deputies of the two countries that the local officials concerned shall make arrangements in consultation with the Yokohama Specie Bank respecting the mode of depositing the Customs' receipts in the Yokohama Specie Bank at Newchwang.

6. The Japanese Military Administration of Newchwang agrees to withdraw entirely by the 6th December,

CHINA RAILWAYS.

CONFIDENTIAL.

[2106]

No. 1.

[January 19.]

SECTION 2.

C. O.

7655

RECE

Consul-General Wilkinson to Sir Edward Grey.~(Received January 19, 1907) 28 FEB 07

(No. 33.) Sir,

Yunnan-fu. December 3, 1906. REFERRING to my despatch No. 32 of the 20th ultimo, I have the honour to inclose copy of a further communication to the Government of Burmah on the subject of the Tengyueh Railway and the Tali reconnaissance.

I have, &c.

(Signed)

Inclosure 1 in No. 1.

W. H. WILKINSON.

Consul-General Wilkinson to Government of Burmak.

(No. 50. Burmah.) Sir,

Yunnan-fu, November 30, 1906. A LITTLE more than a fortnight ago the document, of which I inclose translation, was posted outside the head office of the so-called Yünnan-Szechuan and Tengyueb Railways Company, and at one or two other places in this city. It remained up but a few days, and it is only recently that I have been able to secure a copy of it.

I imagine its origin to be this: In consequence of the telegram, dated the 3rd October last, from your Government telling me that the correspondence of 1902 that passed between Sir E. Satow and the Wai-wa Pu might be cited as giving us equal advantages with the French, I had more than once quoted from the Wai-wu Pu's com- munication of the 16th March of that year. The Chinese officials steadily declared that no copy of this communication is to be found in the archives of the Yunnan Government, and more than one asked to see the text. A copy both of the communica- tion and of that of Sir E. Satow (the 12th March, 1902), of which it is an acknowledgment, was finally given to them, and was, as I learn, shown to the Directors of the Yunnan-- Szechuan and Tengyueh Railways Company. These last thereupon drew up and issued their present poster, the object of which is to warn all patriotic Yünnanese to get beforehand with the British in building in the Tengyueh line.

The authors of the poster (I am told it was drafted by Yang Chin-tung, the school- master who spent three years in Japan) apparently admit that we should be justified in claiming equal privileges with the French, but naively believe that if we are confronted with a railway scheme for exclusive Chinese construction we shall not persist in what they are pleased to style our "covetous desires." The characters I have translated "privileges" ("li-yi") are those employed in Sir E. Satow's despatch of the 12th March, 1902, and in the Wai-wu Pu's reply to it, a sufficient proof that the origin of the poster was as I have described it above. The statement that "the movement of merchandize is far greater at Tengyueh than at Mengtzu is unfortunately not borne out by present facts, but it is doubtless good enough for a prospectus. The charge on the salt and grain contributions" was explained in my despatch to you. No. 57 of the 22nd November last. It is claimed that, from these and other sources, 3,00,050 taels have already been raised, but I very greatly doubt the truth of this assertion.

On the 26th instant the two Superintendents ("tsung-pan") of the local Depart- ment of Foreign Affairs-the Judicial Commissioner, Ch'en Ts'an, and the Grain Intendant, Tseng-hou-called on me to introduce the new Assistant Superintendent, Tsou Chih-ching, who is replacing Kuei-fu, promoted to be Prefect at Cheng-chiang. After promising me, on behalf of the Governor-General, early replies to my despatches on the subject of the reconstruction of the boundary pillars eastward from Nalawt, and

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