This Document is the Property of His Britannic Majesty's Government.
10573
156
CHINA RAILWAYS.
CONFIDENTIAL.
[5360]
No. 1.
[February 10.]
08
SECTION 1.
Messrs. Pauling and Co. to Foreign Office.-(Received February 15.)
26, Victoria Street, Westminster, London, February 14, 1908.
Sir,
WE have the honour to acknowledge receipt of your letter of the 12th February, and note with great regret the decision that His Majesty's Government have come to with regard to the extension of the Chinese Imperial Railway from Hsinmintun to Fakumen.
The construction of this 50 mile extension could only increase the existing volume of traffic and trade that passes by road to Hsinmintun, the present railway terminus, and thence confessedly an increased traffic, and not a lessened one, must pass also to Mukden and to the Japanese South Manchurian system to its benefit.
The construction of this extension cannot be therefore possibly deemed as prejudicial to the South Manchurian system, nor consequently constitute a breach of the Protocol referred to in your letter under reply. We therefore deeply regret that, notwithstanding these facts, His Majesty's Government refuse to assist us in the matter.
We venture respectfully to say that, were it a case of a British Concession being injured by competition, His Majesty's Government would decide the question, and rightly so decide it, on the actual railway facts applicable to the case; and as we have so far not heard of a single reason advanced by the Japanese Government why the extension now proposed could prejudicially affect their South Manchurian Railway traffic, we trusted naturally that, in the absence of all such reasons, His Majesty's Government would assist us in the dispute that has occurred between China and Japan.
It has caused us the greatest surprise to learn that His Majesty's Government consider the Japanese decision on the question is alone to be taken into account by it. Surely, although China may be the less important of the two Powers involved in this dispute, that should not, in our humble opinion, preclude it from being heard in the matter, nor prevent His Majesty's Government giving due consideration to any representations which China may make to His Majesty's Government.
That the Japanese Plenipotentiary, in the informal Agreement signed, we believe, some months after the conclusion of the actual Treaty, really had this particular extension of 50 miles in mind appears to us very surprising, because such an admittedly able statesman as Yuan-Shi-Kai is the Plenipotentiary concerned, both in the Treaty and in the subsequent informal Agreement, and is now the advocate of the construction of this extension on behalf of his Government, and therefore presumably may be quite as correct in his interpretation of the Protocol as the Japanese Plenipotentiary alleges that he is.
We must repeat once more most respectfully that we consider the Japanese action in this matter to be entirely at variance with the Protocol referred to in your letter, and with Article IV of the Portsmouth Treaty of Peace, and with paragraph B of the Preamble of the Japanese Treaty of 1905.
We have communicated with Lord ffrench in the sense indicated in your letter, and we beg to acknowledge, with an assurance of our sincere thanks, the promises His Majesty's Government has been good enough to give us, reiterating its desire to continue its assistance to Lord ffrench whenever possible.
In conclusion, we must beg most respectfully to say, from information cabled to us by Lord ffrench, that when it becomes known that His Majesty's Government have decided against taking up this case, in which British commercial interests of great importance are involved, that decision will be found to so prejudicially affect English enterprises in China as to invite a considerable measure of public and adverse comment there.
We beg, &c. Pauling and Co. (Limited),
(Signed)
J. M. SCOTT, Secretary.
[2856 p-1]