This Document is the Property of His Britannic Majesty's Government]
[B]
CHINA RAILWAYS.
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36988
RECO
[October 25.REG NOV 09
CONFIDENTIAL.
[39286]
No. 1.
SECTION 2.
Sir J. Jordan to Sir Edward Grey.-(Received October 25.)
(No. 365. Confidential.) Sir,
Peking, October 6, 1909. WITH reference to my telegram No. 163 of yesterday's date, I have the honour to transmit to you herewith copy of a preliminary agreement for the financing, construc- tion, and operation of a railway from Chinchou to Aigun, a distance of about 750 miles, which was signed at Mukden on the 2nd instant by the Viceroy and Governor of Manchuria on the one part, and by the agents of an American group and of Messrs. Pauling and Co. on the other.
Before starting for Mukden, Lord ffrench made enquiries from me as to how far I could identify myself with this project, and I gave him to understand that my instruc- tions precluded me from giving him any support. His Majesty's consul-general at Mukden was likewise informed of the attitude which His Majesty's Government desired us to observe in the matter, and the agreement was concluded without any intervention on his part.
The financing of the undertaking is entrusted to the American group, who are, however, it is understood, to have British associates, to whom they are at liberty to grant participation to the extent of a sum not exceeding 40 per cent. of the whole loan. The loan itself is to be guaranteed by the Chinese Government, and is to be secured by the railway.
The contract for the construction and equipment of the railway is assigned to Messrs. Pauling and Co., in whom the appointment of the chief engineer is vested, subject to the approval of the president of the railway company.
The railway is to be operated by a company, which is to be under the control of the Board of Communications. This company is to be composed of Chinese, Americans, and British, the controlling interest being Chinese, and persons of other nationalities are to have no voice in its management or control without the express approval of the Chinese Government.
Any provisions of the agreement which may appear unacceptable to the Throne, or which the Governor of Manchuria may on reconsideration desire to modify, are liable to revision when the detailed agreement comes to be drawn up.
Lord ffrench informs me that an edict issued on the 3rd instant, a copy of which had been communicated to the Viceroy of Manchuria, commanded the Wai-wu Pu, the Board of Revenue, and the Board of Communications to consult with the Viceroy and Governor of Manchuria, and submit a joint memorial to the Throne on the whole
matter.
I learn from an independent and fairly reliable source that the Wai-wu Pu do not altogether approve of the haste with which the negotiations have been conducted, and are likely to counsel more deliberation in the negotiation of the detailed agreement.
I have, &c.
J. N. JORDAN.
Inclosure in No. 1.
Preliminary Agreement providing for the Financing, Construction, and Operation of the Railway from Chinchou to Aigun.
THIS preliminary agreement to provide for the financing, construction, and opera- tion of the railway from Chinchou to Aigun is made between-
Their Excellencies the Viceroy of Manchuria and the Governor of Fengtien, hereinafter called the administration, of the one part; and
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