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

15128

213 REG 5 MAY 09

[April 7.]

CHINA RAILWAYS.

CONFIDENTIAL.

SECTION 3.

[13253]

(No. 47.)

No. 1.

Sir E. Goschen to Sir Edward Grey.--(Received April 7.)

(Telegraphic.) P.

HANKOW-CANTON Railway.

Berlin, April 7, 1909.

I had already inquired of Baron von Schoen yesterday, before receiving your telegram No. 150 last night, as to what truth there was in statement referred to in the telegram. He said that the statement was not true, but in subsequent conversation he admitted that the banks had inquired of him if the Imperial Government desired that they should withdraw from the Agreement. To this he had answered that they must act as they pleased, as the Imperial Government would not be responsible for urging them to break an engagement entered into with the Chinese Government.

The upshot of the long interview we had with Baron von Schoen was that the Imperial Government would not object in the least were the Agreement to be dropped owing to any action taken at Peking by His Majesty's Government, but that they could not exercise any pressure on the German group.

I drew Baron von Schoen's attention to the report of the Paris meeting published in the "Times," His Excellency remarked that he had no knowledge of a Conference held on the 1st March at Berlin, but that it did not alter the matter, since the German Government's standpoint was that they could not recommend to Germans a breach of faith with China.

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