This Document is the Property of His Britannic Majesty's Government.] 10
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Excellency's Delegates Mr. Bland has been repeatedly assured that in the event of more acceptable terms being offered by another nation I must be informed by his Excellency, and the refusal of those terms given to British financiers before the offer of the other country is accepted. In other words, it is well understood that I must have from his Excellency the refusal of the lowest bond fide offer, if that offer is not made by British financiers. In his reply his Excellency does not, however, state this clearly, and to prevent any shadow of misunderstanding, I desire to have this state- ment of the position confirmed by his Excellency in writing before the matter goes any further.
The Grand Secretary has made a friendly reference to myself which I fully appreciate, and I can on my side assure his Excellency that I have no other wish than to see a fair and proper Agreement amicably settled between himself and the British and Chinese Corporation.
I avail, &c. (Signed)
(Translation.) Sir,
Inclosure 3 in No. 1.
Liang Tun-yen to Sir J. Jordun.
J. N. JORDAN.
[Received February 27, 1909.] ON receipt of your Excellency's recent letter I transmitted it in translation to the Grand Secretary Chang, who has now replied to me as follows :——
"The liberal terms accorded by the British Government in making the Canton- Hankow Railway Redemption Loan merit gratitude, it is true, but as for the question, 'What are they to get in return?' This was all laid down in the despatch. If at that time the British Government had not been satisfied with the despatch the nego- tiations could not have been completed; but as they were consummated it is evident that all the British Government wanted at that time in the way of recompense was stated in the despatch.
"At the present time what each party must observe is nothing more or less than the stipulations in the despatch. Signature (of requisitions by the Engineer-in-chief) is not mentioned therein, and evidently cannot be interpolated now.
"Sir John Jordan says in bis Memorandum that this is always the practice in constructing a line. But even if it were the case on other railways, they form no precedent, and, if the case of the Tien-tsin-Pukow line be taken, that Agreement, in which I was concerned in presenting it to the Throne, bas no such provision.
"With regard to my plan for getting offers from other nationalities and opening the tenders all together, this is the fairest way, and is the way in which tenders for the purchase of materials are treated where a preference exists in favour of the lending nation. It may be said to afford an absolute standard of comparison.
"In any case this loan could on no account be diverted to other uses or be wasted. The manner in which it will be utilized will not fail to inspire confidence on the part of the lending Syndicate; but it is absolutely necessary not to injure in the least degree our sovereign rights. I must of course make a satisfactory arrangement. I am sincerely grateful to the British Government for their action in this matter and for Sir John Jordan's consideration in endeavouring to arrive at a friendly settlement. But the only possible course is to cling closely to the despatch, because there are too many crities abroad nowadays, and there is no help for it but to do as I have said.
"I trust, therefore, that you communicate my views to Sir John Jordan, and I hope you will forgive me. This question has been going on for so many years, with so much opposition, and now I have fortunately got to a point of having reported to the Throne that negotiations are in progress. I am really and truly desirous of settling the matter with the English so as not to incur the ridicule of other parties. This, then, is my fervent hope; but if there is a long delay and no conclusion is reached, complications might spring up and this line will never be finished-a consequence which I prefer not to think of, and which Sir J. Jordan cannot desire."
I hasten to communicate the foregoing to your Excellency, and to request that Mr. Bland may be called upon without delay to negotiate quickly with the Delegates on the lines indicated by the Grand Secretary, so as to avoid delay and the loss of this opportunity.
CHINA RAILWAYS.
CONFIDENTIAL.
[11334]
No. 1.
[March 24.]
SECTION 1.
Chinese Central Railways to Foreign Office.-(Received March 24.)
Sir,
110, Cannon Street, London, March 23, 1909. I AM instructed by my directors to acknowledge with thanks receipt of Mr. Langley's letter of the 17th instant, on the subject of the Pukow-Sinyang preliminary Agreement. My directors take note that on receipt of a Report from Sir John Jordan you will again communicate with them on this matter.
Meantime my directors respectfully crave permission to make an observation on that part of Mr. Langley's letter which states that "the present moment would appear to be especially unfavourable to approach the Chineso authorities on this matter, in view of the very inadequate terms as regards security on which they are now trying to secure loans." The fact that the Chinese authorities are trying to secure railway loans on inadequate terms is, my directors submit, entirely beside the question, because the terms of the Pukow-Sinyang Railway loan have already been fixed by the preliminary Agreement, viz., that they are to be identical with the Shanghai-Nanking terms. If the preliminary Agreement is regarded by His Majesty's Government as a valid and binding document, then it would seem the only course to be pursued is to press for the fulfilment of its terms. My directors have no desire to urge their claim to the detriment of other, and it may be more important, British interests, which for the time being are occupying the attention of His Majesty's Minister at Peking. It is for that reason that they have waited now for over a year since the conclusion of the Tien-tsin-Pukow final Agreement, and they are still content to wait if the Canton- Haukow Railway negotiations are not, as they supposed, yet disposed of. But they are not content to wait until the Chinese Government sees fit to improve on the terms they are now offering, firstly, because that would only lead to indefinite postponement, and, secondly, because it would be tantamount to surrendering the preliminary kind. Agreement without compensation of
any
My directors therefore trust that at as early a date as possible the Chinese authorities may be pressed to proceed with the negotiation for a final Agreement. The Agent for the Chinese Central Railways, Limited, has authority to consent to any modification of the original terms that may seem just and right owing to altered circumstances, subject always to adequate security being given for the due protection of the British bondholders.
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I have, &c. (Signed) THOS. GILBERT,
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