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

329

2

The Tsung-li Yamén pledged the right of constructing the Soochow-Hangchow-- Ningpo Railway to the British, and subsequently a draft Agreement was concluded.

In 1905 the Board of Commerce forwarded an application from the gentry of Cheklang for permission to undertake the work themselves, and Sheng Hsuan-huai and others were directed to make satisfactory arrangements to redeem the right out of consideration for the popular wish. However, during negotiations protracted over some years no arrangement had been concluded, aud the funds subscribed by the gentry of Chekiang and Kiangsu have been found greatly inadequate for the purpose, and the prospect of the work being completed within a reasonable time is remote. Moreover, the British have not ceased to assert their claims, and it is out of the question to set them aside absolutely and ignore completely the earlier undertaking, thus committing an act of bad faith which would lead to further complications.

Wang Ta-hsieh, a Vice-President of the Wai-wu Pu, and others having now brought the British to agree to separate the business of the loan from the building of the line, and the control of the latter remaining in our hands, our rights are thereby safeguarded to a far greater degree than under the earlier arrangement.

The Wai-wu Pu are, therefore, commanded to depute an official to negotiate a detailed Agreement on this basis, bearing in mind the necessity that exists for securing the popular interests and the prevention of future abuses. Moreover, the British and Chinese Corporation must be required to allow the gentry and merchants of Chekiang and Kiangsu to subscribe for the bonds as a mark of consideration. With regard to the officials already appointed to build the line, the Board of Communications will make an investigation and recommend their appointment to various posts with a view to the encouragement of the experienced ones among them. The Viceroy at Nanking and the Governors of Chekiang and Kiangsu are also commanded to superintend the arrangements and devote the proceeds of the loan to the speedy construction of the line. They must at the same time admonish the gentry, in view of the difficulties of the times, to unite in their support of the Imperial policy. There must at no time be any recourse to forcible opposition, in order that our good faith may be manifested, and the friendly relations of the whole Empire with foreign nations strengthened.

Transmitted in accordance with the Imperial command.

CHINA RAILWAYS.

CONFIDENTIAL

[40886]

1798

[December 24.]

RECE Red 17 JAN 08,

SECTION 1.

No. 1.

Sir Edward Grey to Sir J. Jordan.

(No. 529.) Sir,

Foreign Office, December 24, 1907. I HAVE received your despatch No. 514 of the 30th October last on the subject of the li-kin and loti charges levied on goods carried by the Shanghae-Nanking Railway.

I observe that Mr. Bland proposes to send a statement of the case for the railway to the Board of Communications, and to ask for the appointment of a Director-General with whom the matter may be discussed and settled in accordance with the terms of the Loan Agreement.

I shall be glad to learn the result of Mr. Bland's representations as soon as possible. I request that you will do everything in your power to promote a satisfactory settlement of the question, in view of its importance as involving in some measure the success or failure of railway enterprise in China.

[2768 aa-

I am, &c. (Signed) E. GREY.

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