332
DRAFT.
Viceroy a draft agreement which stipulates
that equal participation should, be granted to
the Hong Kong and Shanghai Bank and to the
French Bank; that the Viceroy has categorically
refused to permit French participation; and
that matters are at a deadlock. Lord
Elgin is not aware of the reasons for the
change of front indicated by the Consul-
General's action, but in view of the terms
of Mr Fraser's letter quoted above he is not
surprised at the Viceroy's attitude. The
result of accepting French "co-operation"
which was foreseen by Sir E. Satow has now
come about; there is no prospect of the loan
being granted to an Anglo-French group as such,
and even if it is possible for the Brivish
and Chinese Corporation to free itself from its
French connexion it is clear that it has not
improved its chance of carrying through
negotiations for a British loan.
9.