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section of the Szechuan line and asked for British tenders for the same work. By Sir Ernest Satow's order I thereupon supplied his Excellency with the correspondence giving British capital first option of lending and also a note of the terms our people could offer. In the autumn, however, his Excellency was precluded very favourable by Imperial order from borrowing for railway construction and, as he told me, the Szechuan Viceroy had also obtained sanction to the whole of the line westward being made exclusively with Chinese capital, the project was not pursued.
In the following year his Excellency vainly represented that there was no prospect of Hupei and Hunan raising the necessary capital themselves and that foreign loans were not bad per se and might, indeed, prove of great benefit provided the terms were carefully negotiated.
And last year his Excellency again started the subject of loans for railway construction, but stated that he could not get due support from the Peking Boards.
Since his Excellency's entry into the Grand Council he has once more mooted the subject to Mr. Bland, representing the Central China Railways (Limited), in which French capital is also concerned. His Excellency at first talked of a loan for the line to Canton, but recently he has decided that your Excellency may be able to do without a loan on that line, and his Excellency the other day suggested that Mr. Bland should come to Hankow and discuss a loan for the line westward with your Excellency, to whom he said he would telegraph.
Mr. Bland has moved Sir John Jordan to direct me to ascertain your Excellency's opinion of the advisability of the loan proposed, as he would not venture to come and waste your Excellency's time in case you do not look favourably on the suggestion.
I do not know accurately what amount of capital has been subscribed for the Hupei section of the line to Szechuan, but I believe that the Provincial Government has very prudently concentrated public attention in the first place on its part of the line to Canton, lest the somewhat lukewarm response of Chinese subscribers result in neither line obtaining capital sufficient to justify beginning actual work. The state of the market in France and England is, I understand, at present favourable to the raising of a loan for Chinese railway enterprises; and the terms of the recent Agreements made by British representatives are far more favourable to China than could have been obtained a few years ago, to say nothing of the Agreements originally made for the lines north and south from Hankow. Your Excellency knows that the supply of transport facilities will be promptly followed by great expansion of Hupei trade, and the apprehension of want of support in the capital which hampered his Excellency Chang is no longer to be feared.
I venture therefore to ask your Excellency whether you would like Mr. Bland to pay a visit on the understanding that, so far as Hupei is concerned, there will be a prospect of business resulting.
I am at present at the Lushan for my health, but shall be happy to wait on your Excellency at any time if you will give me two or three days' notice.
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proffering suggestions and doing your utmost to further its success, I fear that the magnitude of this affair renders the attainment of the object quite difficult.
I should be delighted by receiving Mr. Bland to profit by his advice; but the heat is at its height and everyone feels its oppressiveness. I could not reconcile myself to causing Mr. Bland to make the journey here and back on speculation. I beg, therefore, that you will be good enough to convey to Sir John Jordan my desire that Mr. Bland postpone coming to Hupei until in the future some opening justifies my making a special appointment to see him.
I avail, &c. (Card of Chên K'uei-lung.)
I have, &c.
(Signed)
E. H. FRASER.
(Translation.) Sir,
Inclosure 3 in No. 1.
Viceroy Chên K'uei-lung to Consul General Fraser.
June 25, 1908.
I HASTEN to answer your note asking my opinion about a suggested loan for the construction of the Szechuan-Hankow Railway, and informing me that Mr. Bland, representative of the British-Chinese Corporation, thinks of coming to Hupei to consult me personally.
The gentry and merchants of the two provinces concerned have taken the duty of collecting railway shares with sufficient alacrity, and there is no advocacy of borrowing foreign funds.
I appreciate deeply what you say of the advantageous terms for a loan, and the immense result which the prompt completion of the line would have on the future of Hupei trade; but the Throne has long ago forbidden the provinces to raise loans for railway construction; and, while grateful for your kind interest in
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