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the present position of affairs is as follows:-
Mr. Hillier, the Agent in Peking of the Hongkong and Shanghai Banking Corporation, is carrying on active negotiations for a joint British, French and, possibly, German loan to enable the Chinese Government to redeem the Peking-Hankow Railway, as they have the option of doing this year under the original agreement. This loan will be a purely financial transaction, and, if it is arranged, the railway will fall entirely under Chinese control. At the present time the engineers and the materials are supplied from France and Belgium. In return for the British group's agreeing to continue to allow French and Belgian engineers exclusively to be employed and the materials to come as before from France and Belgium, the French group will leave the British group a free hand as regards the same matters on the Canton-Hankow Railway should a joint loan for the construction of this latter line be agreed upon. Negotiations for this latter loan are however at present at a standstill.
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