[This Document is the Property of His Britannic Majesty's Government.]
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however, is insufficient, it will be so difficult to build the railway that the question of redeeming it will not arise. The original contract was not arranged by myself, and it would be useless to gloss over the loss to which we have been subjected by the terms of that contract and by the former extravagance of the foreign officials. It would seem impossible to avoid making the unwelcome proposal of raising loans, and impossible to neglect the whole question, on account solely of this former failure. Moreover, these shares are purchasable by Chinese, so that it will, of course, be necessary to issue Proclamations and insert advertisements in the newspapers, in the hope of retaining the interest thereon for Chinese. I have reduced the loan required by the Company on this occasion from 1,000,0007, to 650,000. In the original contract the loan was at 90, but it would appear that the terms upon which China raises loans are improving, and on this occasion in borrowing the sum of 650,0001, there may be an addition to the terins, which may amount to 95 and 96. After careful calculation, it appears to me that the redemption of the railway may reasonably be expected after twelve years by means of repayment by yearly instalment of principal and interest out of the surplus of the income for traffic. If, however, there is a cessation of work owing to lack of funds the loss to which we shall be subjected will be all the greater, and after repeated calculations I consider that the only course is a further loan.
If I am favoured with the Imperial sanction, it will be proper that I decide upon other rules and give directions that the various officials inquire thoroughly into the manner in which money is spent, and report at each quarter to the Board in accordance with the contract, thus complying with the Imperial sentiments, &c.
Owing to official duties I shall be unable to present my card at the Imperial dinner-table, craving audience for the following day.
Rescript by the Council of State.
Rescript by Board of Commerce and Revenue that, in view of their inability to raise the funds required, it be arranged as suggested by the memorialist.
CHINA RAILWAYS.
8373
[January 28.]
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CONFIDENTIAL.
SECTION 4.
1 6 MAR 07
No. 1.
[3107]
Sir J. Jordan to Sir Edward Grey.-(Received January 28, 1907.)
(No. 521.) Sir,
Peking, December 11, 1906. I HAVE the honour to transmit to you herewith copy of a despatch which I have received from His Majesty's Consul at Swatow, reporting the opening of the railway from Swatow to Chao Chou-fu on the 25th ultimo.
This line, which is a Chinese concern, but for which the contract was given to a Japanese Company, formed the subject of detailed reports from His Majesty's Consulate at Swatow, inclosed in Sir Ernest Satow's despatches to Lord Lansdowne No. 195 of the 30th May, 1904, No. 45 of the 5th February, 1905, and of Mr. Carnegie's despatch to you No. 226 of the 15th May, 1906.
I have, &c. (Signed)
J. N. JORDAN,
0
(No. 28.) Sir,
Inclosure in No. 1.
Consul Hausser to Sir J. Jordan,
Swatow, November 26, 1906. I HAVE the honour to report the formal opening yesterday of the railway from Swatow to Chao Chou-fu.
On the invitation of the Directors some 300 guests, foreign and Chinese, assembled at 11 A.M. at the Swatow station, and were taken by train to Chao Chou-fu, about 30 miles distant. This was covered in an hour and a-half, the same time being taken for the return journey. Luncheon was then served in the goods depôt, and the pro- ceedings terminated about 4:30 P.M. At Swatow and all along the line the Chinese were very demonstrative in their enthusiasm, the crowd at Chao Chou-fu especially being very great.
There are at present four stations between Swatow and Chao Chou-fu, viz., Ampo, T'sai Tang Chib, Pu Ju, and Hong Koei, and it is intended shortly to open three more stations at Tan Meng Kio, Kin Chih Keng, and I Koei. The first portion of the line runs over low-lying country much intersected with tidal water-courses and ponds, and the soil is loose and sandy, so that the train had to proceed with caution. After leaving Ampo the track improved, and a fair rate of speed was attained-about 25 miles an hour. The line is somewhat unevenly laid, and the embaukment on which it runs is low and certainly not wide enough. The ballast consists chiefly of sands and loose soil, so that in the rainy season washouts will surely occur, and it will be no easy matter to keep the line in working order. The carriages, first and third class only, are built on the American plan, but are small and incommodious from a foreigner's point of view. Engine-drivers, guards, pointsmen, &c., are all Japanese. So far only passengers are being carried, and the receipts from this traffic during the three days the line has been working are said to have averaged 500 dollars a-day, which, if maintained, should give a dividend of per cent. to the shareholders. The cost of a ticket from Swatow to Chao Chou-fu is 1 dol 25 c. first class and 50 cents third for the single journey.
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The country traversed appears extremely productive, wide stretches of paddy land alternating with patches of sugar-cane and orange groves, and in course of time no doubt a certain amount of cargo will be brought down to Swatow by rail.
road
One great drawback is the present inconvenient situation of the Swatow terminus, which is some three-quarters of a mile from the sea-front, with no direct or proper to it, and with a broad creek intervening. It is intended later on to carry the line
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