751
C. O.
[This Document is the Property of His Britannic Majesty's Government.34965
REED REG: 25 OCT 09:
CHINA RAILWAYS.
CONFIDENTIAL.
[October 1.]
SECTION 1.
[36442]
No. 1.
Note communicated to M. de Kühlmann.
AS regards the China railway loan, about which you spoke to me a few days ago, I understand that Sir E. Grey informed you of the view he took of the matter on Thursday. However, it may be convenient to you that I should repeat it.
It appears to Sir Edward that the German group are now expecting the British group not only to make a sacrifice as regards the engineer on the Szechuan line, but also to make another sacrifice on the Canton line to compensate the German group for what they gave up on the Szechuan line. The British group would thus be making a double sacrifice.
The British group only agreed that the German group should have the Hupeh section of the Szechuan line on the latter agreeing that the extension beyond should be shared between the French and British groups, but now that American participation in the extension has been admitted by all the three parties concerned it seems only fair that all three should give up something in order to allow of this participation.
If the loan were now signed, as suggested by the German group, leaving the engineor question to be settled later, they would apparently get their full share, whereas the British and French groups would have to provide for the American group out of their shares.
But please regard the above as a verbal communication only, in reply to what you said to me.
Foreign Office, October 1, 1909.
[2471 a-1]