[This Document is the Property of His Britannic Majesty's Government.]
CHINA RAILWAYS.
CONFIDENTIAL.
[34467]
No. 1.
[October 5.]
SECTION 1.
Colonial Office to Foreign Office.-(Received October 5.)
THE Under-Secretary of State for the Colonies presents his compliments to the Under-Secretary of State for Foreign Affairs, and is directed by the Secretary of State to transmit, for the information of Sir Edward Grey, with reference to the letter from the Colonial Department of the 19th June, a copy of correspondence on the subject of the Canton-Kowloon Railway.
Downing Street, October 3, 1908.
Inclosure 1 in No. 1.
Governor Sir F. Lugard to the Earl of Crewe.
(Secret.) My Lord,
Government House, Hong Kong, August 6, 1908,
I HAVE the honour to acknowledge your despatch, Secret, of the 26th June, relative to the negotiation of a Joint Working Agreement with the Chinese for the Kowloon-Canton Railway.
2. I inclose copy of a despatch which I have addressed to Sir John Jordan, together with its inclosure, and a copy of the letter from His Majesty's Consul-General, Canton, alluded to in my postscript. As soon as I receive a reply to this despatch I will address your Lordship fully on the subject.
3. You will observe from the final sentence of paragraph 9 of the inclosure that Mr. Grove, Chief Resident Engineer of the Canton section, holds the same view as that attributed by your Lordship to the Consulting Engineers in the first paragraph of your despatch, and in this view I understand that Mr. G. W. Eves, Chief Resident Engineer of the Kowloon section, concurs. Mr. May, who has a knowledge of the Chinese extending over twenty-five years, also urges me very strongly not to bring forward the subject of the Working Agreement at present, for he fears that it may possibly be used as a means of delaying the construction of the line, since the artificial difficulties alluded to in paragraph 8 of my despatch to Sir John Jordan seem to indicate that the authorities for some inscrutable reason exhibit at present no desire to push forward the work.
I have stated in that paragraph my own reasons for not delaying these negotiations too long, but I concur with Mr. May that they can well be deferred until the Chinese have committed themselves by the purchase of the requisite land. This should easily be acquired before February next, and in that case the Chief Resident Engineer of the Canton section would still require two and a-half years to complete. If not acquired, completion will be delayed and cannot be anticipated for four years from this date.
4. I may observe that I believe Mr. Grove to be a very upright and straightforward man. He considers himself to be the servant of the Chinese Government and bound in honour to uphold their interests, but he is, I think, incapable of furthering those interests in any underhand manner. He has stayed with me at Government House on several occasions and freely discussed railway matters.
I have, &c. (Signed) F. D. LUGARD.
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