C.0.
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This Document is the Property of His Britannic Majesty's Government.
2
110,000l. per annum) due to this Government from the Viceroy of Wuchang, should he desire to devote this money to the construction of the line. The loan by this Colony is fully secured, and the interest at 4 per cent. is regularly paid.
The postponement of the payments due this year (and, if need be, next year) could be made on the application of the Viceroy, based on a plea that it was inconvenient to meet the obligation at present, with a private understanding that the money, which is entirely Chinese money raised by local taxation, would be applied to pushing on construction. It may be that if the French group find that the Chinese are obdurate, and that they are themselves finding money for the work, they may recede from the position which has caused this impasse. In this connection I would invite your Lordship's attention to Mr. Just's letter of the 24th August, 1907, to the Foreign Office, and to the previous correspondence to which it referred.
5. Sir John Jordan, I think, concurred that this would be a means, and the only visible means, of getting out of the difficulty unless either the French or Chang-chi-tung should give way, but he appeared to think that it would be necessary to inform the French of the fact that I had allowed postponement of the Viceroy's payments. I can hardly see the necessity for this myself, it being purely a matter between this Colony and the Viceroy how and when the loan he has contracted shall be repaid, but Sir John Jordan is in a better position to judge than I am.
6. If at the time this despatch reaches your Lordship's hands the impasse still continues, and you are disposed to concur in my suggestion, I shall be glad to receive your Lordship's instructions by telegram.
7. I am forwarding a copy of this despatch to Sir John Jordan.
(Confidential.) Sir,
I have, &c.
(Signed) F. D. LUGARD.
*
Inclosure 2 in No. 1.
The Earl of Crewe to Governor Sir F. Lugard.
Downing Street, June 12, 1908.
I HAVE the honour to acknowledge the receipt of your Confidential despatch of the 10th April and your telegram of the 12th May with regard to the Canton-Hankow Railway, and to transmit to you, for your information, the inclosed copies of correspondence with the Foreign Office regarding the contemplated Anglo-French arrangement.**
2. As at present advised, I am not disposed to favour the suggestion put forward in the fourth paragraph of your despatch, that the instalment due from the Viceroy of Wuchang might be postponed for this year.
I have, &c. (Signed)
* To Foreign Office, May 19; Foreign Office, May 26, 1908.
CREWE.
CHINA RAILWAYS.
CONFIDENTIAL.
(21172]
[June 20th JUL 08
SECTION 1.
No. 1.
Sir J. Jordan to Sir Edward Grey.-(Received June 20.)
(No. 224.) Sir,
Peking, May 25, 1908. THE appointment of Mr. R. St. George Moore as engineer of the Wuchang-Yochou section of the Hankow-Canton Railway, which was referred to in my despatch No. 207 of the 11th May, was definitely made on the 30th April, under an Agreement, copy of which is inclosed herewith. The terms of this Agreement, which was negotiated by Mr. Moore with the Hupei authorities directly, and without the direct intervention of His Majesty's Consul-General, are, I believe, not such as would be generally acceptable to British engineers in Chinese employ, but Mr. Moore
appears to be specially agreeable to the Chinese, and the Agreement may work well in his case.
On the 21st May Mr. Bland handed me a Memorandum (copy inclosed)* upon his negotiations regarding a construction loan for the Hupei-Hunan section of the railway, from which it seemed likely that Chang Chih-tung's delay in resuming the discussion after the appointment of the new Viceroy at Hankow might be due to objections lodged by the Belgian Minister at the Wai-wu Pu.
In conversation with my French colleague on the morning of the 22nd May, I ascertained that Baron de Grenier had told him that representations of the nature described in my despatch No. 207 had been made at the Wai-wu Pu in opposition to an Anglo-French loan, and M. Bapst was disposed to attribute this opposition to the fact that the Belgian group interested in the financial undertakings of the British and Chinese Corporation was different from and antagonistic to the Belgian group at present controlling the Peking-Hankow Railway. M. Bapst further said that he had mentioned the subject at the Wai-wu Pu, but was given no information regarding the Belgian objections, which, in any case, he did not seem disposed to combat actively.
The preferential rights secured to us under Chang Chih-tung's letter of the 9th September, 1905, to Mr. Fraser, appeared to me to require that serious notice should be taken of the Belgian Minister's action, and, in an interview at the Wai-wu Pu on the afternoon of the 22nd, I discussed the whole question with his Excellency Liang Tun-yen. I reminded him of the principal steps in the negotiations which are recapitulated in Mr. Bland's Memorandum, and stated that, as far as I could understand, these negotiations were held in check by certain claims of the Belgian Minister which were based on Sheng's letter of the 26th June, 1898, and on the unredeemed bonds. I expressed a hope that the Belgian contentions, which had no rational basis, would not be listened to, and warned his Excellency that if they were seriously entertained by the Chinese Government I should be compelled to protest vigorously. I produced a copy of Chang Chih-tung's letter of the 9th September, 1905, which his Excellency knew of but had not read, and he readily acknowledged that it gave us clear preferential rights. According to him, the Wai-wu Pu did not admit the Belgian claims, but the Belgian Representative had been told that there was nothing to prevent his people from quoting terms for the loan. To this I said there was no objection, provided that the conditions of Chang's engagement were borne in mind and the British financiers given the preference if their terms were equally favourable.
His Excellency told me he understood that Chang had really felt his way blocked by the Belgian intervention, and had thought of deferring the loan for the Hankow-Canton line and concluding one for the Hankow-Ichang Railway instead. It was, he said, very desirable that the southern trunk line should be completed quickly, but he did not see how Chang could make any further move except at the instance of the Hankow Viceroy. No doubt, if the latter applied for a loan, Chang would support him. His Excellency promised to try and see Chang, but appeared to favour direct representations by Mr. Bland to the Viceroy.
I objected that on previous occasions Messrs. Bland and Hillier had spent a long time at Hankow in negotiations which were made fruitless by the Central Government...