t
F
and Governors wishing to borrow for any urgent public
purpose should be required as a preliminary to memorial-
ise the Throne stating clearly the object of the propoand
loan and the sournes from which it was proposed to pay157
the interest and refund the principal, The Throne was
to refer the memorial to the Board of Finance for report,
and if their report was favourable, the provincial
authorities would be authorised to proceed with the
negotiations and submit the final agreement to the Board
for their approval, after which the remaining Tomalities
required in the case of a foreign loan could be pro-
ceeded with. H.B.wished to point out to me as a friend
that the course adopted by Chang Kung pao could only
peault in waste of time and disappointment on both sidos;
sinoc unless the above procedure were complied with,
any agreement we might come to would most certainly be
thrown out by the Board of Finance on reference to them,
I asked H.3.1f the new regulations also applied to
railway loans. He replied that it applied to all foreign
loane, I presume from this that the new regulations may
be taken as replacing and tacitly rescinding the
prohibition of 1905, but I did not put this question
to Na tung. that he said left me in no doubt as to the
course to be followed in the present instance, and I
shall be glad if you will be so kind as to communiceste
the substance of it to HI.E.Chang.
The general impression I derived from la tung's
TOMATKA MAD first, that the attitude of the Peking
authorities towards foreign loans has undergone a fresh
ohange, they are preparod to recognise the necessity for these under special circumstances but desire to
retain