2
China. We desire, however, to record our emphatic opinion that the continuance of such reduction after 1910 should be made absolutely conditional on the fulfilment by China of her part of the agreement. We dealt very fully with this point in our despatch No. 64, dated the 21st February, 1907, and we do not propose to repeat our arguments at length. We would merely insist on the main fact that, in proportion as we reduce our exports, so is China pledged to reduce her own production, and, in so far as the latter condition may not have been attained, the former should be held in abeyance. We are fully prepared to admit that the central authorities in China are thoroughly in earnest in their desire to eradicate the opium habit, and that some at least of the provincial governors have taken up the matter with vigour. The information given to the Shanghae Commission showed, however, that China herself was unable to give any satisfactory statistics of the progress made, and the consular reports which we receive indicate that such progress is by no means universal. would, therefore, strongly urge that consent to a continuance of the agreement after the year 1910 should not be accorded until trustworthy evidence of concomitant reduction of poppy cultivation has been secured by independent inquiry, on behalf of His Majesty's Government, by an official, for instance, such as Sir Alexander Hosie, who has large knowledge of the great poppy growing districts, and is also understood to be in sympathy with the prohibition movement,
We
12. If the result of this enquiry were favourable, we should consent to a continuance of the agreement for a further term of three years. We consider, however, that it would in that event be eminently desirable to lay down certain further conditions. As your Lordship is aware, the merchants engaged in the wholesale trade with China have recently had reason to complain of restrictions placed on the sale of the Indian drug, and we think that we may fairly insist that they should be allowed free trade within the treaty ports, and that the number of wholesale dealers should not be arbitrarily reduced. Restrictions on retail sale are, we fully recognise, entirely justifiable if China is to make real progress with the check of consumption; but this argument does not apply to wholesale dealings.
13. We also consider it most essential that China should not increase the duty on Indian opium unless and until there has been a corresponding and effective increase in the taxation of the local article. Otherwise, as we pointed out in our despatch No. 64, dated the 20th February, 1907, there would simply be a transfer of revenue from our exchequer to that of the Chinese Government.
This Document is the Property of His Britannic Majesty's Government.]
OPIUM,
CONFIDENTIAL.
[14136]
No. 1.
CO 14293
[April 25.]
SECTION 2 RECE 12 MAY 10,
Mr. Max Müller to Sir Edward Grey.-(Received April 25.)
(No. 102.) Sir,
Peking, April 8, 1910. WITH reference to my despatch No. 99 of the 7th instant, I have the honour to transmit a copy of a despatch from His Majesty's consul-general at Chengtu pointing out that foreign merchants may soon find it worth their while to commence to import foreign opium into Chungking. Mr. Wilkinson refers to the prohibition against the importation of opium into Szechuan, and shows that, in the event of any foreigner attempting to introduce foreign opium into the province, the Governor-General might very probably resort to measures which would call for a strenuous protest from the consul concerned, and he suggests that he should be authorised to inform the Governor- General beforehand that any such attempt on the part of a British subject would be reprobated.
Mr. Wilkinson's suggestion deals only with a possible contingency, and I did not feel justified, without definite instructions from you, in authorising him to give any such assurance as he proposed to the Chinese authorities. I have, however, enquired of the acting British consul at Chungking whether there is a probability of any British firm represented at that port embarking on the importation of Indian opium into Szechuan, and have instructed him to do what he can to dissuade British merchants from engaging in a trade which would lay them open to justifiable criticism and might place this legation in a very difficult and embarrassing situation vis-à-vis the Chinese Government.
I have, &c.
W. G. MAX MÜLLER.
Enclosure in No. 1.
Consul-General Wilkinson to Sir J. Jordan.
(No. 21. Confidential.) Sir,
Chengtu, March 8, 1910. IN my immediately preceding despatch I reported that the import of opium into Szechuan after the 10th April next has been forbidden by the provincial Government, Hitherto, as you are aware, the only opium brought into this province in quantities not too small to escape the attention of the Customs, maritime or provincial, has been native raw opium from Yunnan, Kueichou, Kansu, or Shensi. It is conceivable, however, that if the measures now being taken to prevent the sowing of the poppy and to force private holders of native opium to either export their stocks before the 7th July or to sell them to the Régie prove successful, the price of the drug will rise to such a point as would make it highly profitable to import Indian opium from Shanghae. What, under those circumstances, could legitimately be done by the Szechuan Government.
Indian opium is not contraband, nor is there any agreement between the Governments of Great Britain and China to forbid the import of it into any part of the Empire.
Moreover, the Opium Régie in Szechuan is of the nature of a corporation privilégiée," or a "coalition organisée dans le but d'excercer un monopole sur le commerce," both of which are declared illegal in the treaties. As long as the Régie deals with native opium only, and a trade in which foreigners have not, and never have had, a part, no cause for the citation of these articles in the treaties will arise; but if, for example, a foreign merchant were, after the 10th April, to bring a number of chests of Indian opium to Chungkiung-a treaty port-and on his own premises to prepare the drug for consumption within his compound, what would happen? It seems clear that he would be acting within his treaty rights; nor is it easy to see under what actual law his Chinese clients could be punished, provided that they held "Permits to smoke. The existence of such establishments would, however,
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