[This Document is the Property of His Britannic Majesty's Government.]

CHINA RAILWAYS.

CONFIDENTIAL.

[11041]

103

C.0. 12734

[March 24.]

SECTION 2.

Acce

Rece 14 APR OC

No. 1.

Sir Edward Grey to Sir J. Jordan.

(No. 51.) (Telegraphic.) P.

Foreign Office, March 24, 1909. CANTON-HANKOW Railway Loan. My telegram No. 49 of the 20th instant. It is the desire of the Germans to conclude two Agreements, one to relate to all loans to China and another to railway loans exclusively, both Agreements to be subject to certain provisions. After conclusion German Agent at Peking is to open negotiations with the aid, if necessary, of British and French Legations, for modification of Preliminary Agreement to Canton-Kowloon terms of control as minimum.

Provided that Hankow-Chengtu Loan (Hupeh section) is concluded simultaneously, British and French groups may then arrange for Canton-Hankow line (Hunan and Hupeh sections). Chief Engineer of latter to be British, but for former German,

British group are to consider those proposals to-day, and prima facie there appears, Addis says, no reason why negotiations should not be resumed.

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