This Document is the Property of His Britannic Majesty's Government
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calculated to compete with the existing Eastern Chinese railways can only be raised when Russia and Japan have signified their consent. There is no secret about Russian and Japanese rights in this matter: these rights are defined by international treaties which were duly communicated to the Government of the United States. To enter into diplomatic intrigues with Germany and China without previously consulting Russia and Japan only shows a lack of diplomatic education which can scarcely be regarded as an ornament in one who occupies the responsible position of Secretary of State to the great American Republic. From information which has reached the press it would seem that the Russian Minister for Foreign Affairs is seriously considering Mr. Knox's frivolous proposal. If M. Isvolsky has plenty of time on his hands he may of course employ it, among other things, in studying the scheme for the trade neutralisation of Manchuria, invented by American politicians in their leisure hours, but it would be much more useful if he would employ it on more productive work, in considering, for instance, the great question of how to achieve the harmonious working of the northern and southern portions of the Eastern Chinese Railway. The Japanese Commission which visited St. Petersburgh last summer for the special purpose of establishing an agreement on this question returned to Tokyo without having apparently achieved any result. The preparation of a plan of traffic and a formula of taritis acceptable to both Russia and Japan would be incomparably more useful than wasting time on the consideration of Mr. Knox's handiwork, which is not necessary to anyone except American politicians, and is harmful to all in the Far East. The decision of this question, so important for the external relations of Russia with her neighbours, will, perhaps, prove in the long run to depend, not on the Ministry for Foreign Affairs, but ou other departments which have their own foreign policy.
I have, &c.
A. NICOLSON.
CHINA RAILWAYS.
CONFIDENTIAL.
[2389]
No. 1.
[January
REAL FEB 10 SECTION 1.
Mr. C. S. Adais to Foreign Office. —(Received January 21.)
Hong Kong and Shanghue Banking Corporation, Dear Mr. Greg,
31, Lombard Street, London, January 21, 1910. REFERRING to our conversation by telephone last night, I should like to make clear the nature of the claim to participation of the British and Chinese Corporation (Limited), in the proposed Chinchow-Tsi-tsi-bar Railway. It is based on the Fukumen loan contract, signed by Bland and Tang Shao-Yi on the 23rd November, 1907. That contract was suspended, but never abandoned, in deference to the Foreign Office view that the Japanese objection to the construction of a railway which would eventually find its terminus at Tsi-tsi-har was valid. If that objection is now removed, as shown by the British Minister's support, subject to Japanese participation, of the Chinchow- Tsi-tsi-har Railway, then the British and Chinese Corporation (Limited) feel that they have a right to claim his support in pressing the Chinese Government either for the fulfilment of the original Fakumen contract or for participation in the Chinchow- Tsi-tsi-har loan by way of compensation.
I enclose a copy of the Fakumen loan contract for your file, and also a copy of Paulings' construction contract. You will observe that they are distinct and separate documents, and that the prosecution of the British and Chinese Corporation's claim does not in any way conflict with Paulings' rights, which are confined to the construc- tion of the line, but have nothing to do with its finance.
Yours truly,
C. S. ADDIS.
Gentlemen,
Enclosure 1 in No. 1.
Mr. Bland to the British and Chinese Corporation, London.
Peking, November 23, 1907. I HAVE the honour to enclose copy of the contract, as agreed to on the 20th instant between his Excellency Tang Shao-Yi and myself, for the loan of a sum of 500,0007. for the Northern Railways extension to Fakumen. Owing to the possibility of diplomatic complications, the matter was necessarily hurried, and my stay in Mukden was curtailed to two days because of the urgency of business in connection with the Hangchow negotiations, but I trust that the results will not be considered unsatisfactory by your board. If this loan and the construction by Messrs. Pauling and Co. go through satisfactorily, the business should afford a most useful precedent and lead to the completion of the line to Tsi-tsi-har in the first instance, and the conclusion of similar agreements for other railways.
I have to-day telegraphed to you, in connection with the above, as follows:- "With reference to my telegram of the 12th and yours of the 15th instant, we have signed an agreement with Tang Shao-Yi subject to Imperial edict, which we expect, in the absence of political complications, in three weeks. Agreement going forward via Russia to-day. Security for loan to be Imperial edict, revenue of this extension and salt revenues Fengtien 380,000 taels. Loan to be issued at option Chinese Government in twelve months, British and Chinese Corporation retaining 5 points, advancing 50,0001. (at) 6 per cent. Loan to be redeemable in thirty years, commencing eleventh year, the usual premium. The extension to be part of Northern Railways, administration, operation the same way, After construction the same engineer-in-chief. With a view to preventing interference others it is important keep this strictly confidential pending issue Imperial ediet.”
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I have, &c.
J. O. P. BLAND,
Representative in China.
B