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Hunan governor's reply to the protest of the consular body. The former refused to accept the amount suggested by Mr. Fraser to be exported to Hupei, i.e., 1,500,000 piculs per half-year during the period of the embargo, and would only consent to 40,000 piculs
a-month.
On the 7th March Mr. Fraser telegraphed that the governor still refused to give permits for exports to Shanghae, and actually argued that Hunan and Hupei were one province under the Viceroy at Wuchang, and consequently that he was acting in accordance with treaty. He pointed out that unless strong pressure was brought to bear British merchants might lose heavily.
Owing to the refusal of the German Minister to join, the diplomatic body were unable to take united action in the matter, and therefore on the 11th March Mr. Max Müller addressed a long note (copy enclosed) to the Wai-wu Pu, recapitu- lating the history of the case, and stating that, subject to certain conditions, he was prepared to agree to a temporary modification of the treaty rules. These conditions
were-
1. That an amount of relief rice liberally estimated for the distressed province of Hupei should be stated beforehaud;
2. That the purchase and conveyance of such rice up to the stipulated amount should be open and free to all; and
3. That the modification of the treaty provisions should hold good only until the new crop should be harvested in the middle of 1910.
At the same time the French, Russian, and Japanese Ministers addressed notes to the Wai-wu Pu which, although not couched in identic terms, yet in substance adopted the same line of argument as that advanced by Mr. Max Müller in his note of the 11th March.
The Wai-wu Pu, in a note of the 14th March, replied communicating a telegram from the governor of Hunan stating that, in accordance with treaty, he proposed to issue a proclamation prohibiting the shipment of rice from Hunan twenty-one days after notice, thus admitting the illegality of his previous action. The board also communicated the text of an Imperial decree consenting to this, and also to a further proposal of the governor that relief rice for Hupei should be placed on the same footing as tribute and army rice. The wording of this note was somewhat obscure, and no notice was taken of the conditions mentioned in Mr. Max Müller's note of the 11th March.
Upon enquiries being made of His Majesty's consul at Changsha, he replied that the notification of a general prohibition was published on the 16th March, but that the local authorties showed no intention to ship any relief rice during prohibition. His Majesty's consul-general at Hankow, however, telegraphed on the 17th March that the Commissioner of Customs at Changsha had informed His Majesty's consul there that until the 7th April he would issue permits for any treaty port. Mr. Hewlett was thereupon instructed to apply for the permits previously mentioned by him, and, if refused, to protest and inform the legation. To this Mr. Hewlett replied that, owing to a drop in the price of rice at Shanghae, the two British firms no longer wished to export the quantity named.
On the 22nd March Mr. Max Muller addressed a further note to the Wai-wu Pu pointing out that relief rice, not being mentioned in the treaty, must be the subject of a special arrangement with the treaty Powers, and could not otherwise be dealt with on the same footing as tribute and army rice.
Mr. Max Müller went on to restate the conditions under which he was prepared to consent to a temporary modification of the treaty, and suggested that instructions should be sent to the Viceroy of Wuchang and the governor of Hunan to come to a satisfactory arrangement on those lines with His Majesty's consul-general at Hunkow.
In a despatch from Changsha dated the 21st March, Mr. Hewlett reviewed his attempts during February and March to persuade the authorities to issue permits to British firms to ship rice to Shanghae and Tien-tsin, in which he had met with no success, the taotai putting forward the strange argument that the treaty provisions for export from one port to another port did not mean to any other port, but to one other port, and was satisfied by export to the port of Hankow alone. Mr. Hewlett also stated that the governor had first intended not to permit free export during the twenty-one days' notice, but was eventually dissuaded from this course by the Commissioner of Customs. As regards the reality of expected scarcity, Mr. Hewlett was doubtful whether it could be proved, and he stated that it was more probable
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that rice bad been stored in several places throughout the province for the purpose of driving the price up. He added that the 1909 crop was not considered an unduly bad one, but that the governor had thrown in his lot with a clique of gentry whose interest in the rice question was limited to the fortune they could amass by tampering with
the trade.
To this despatch Mr. Fraser appended a note giving the text of the telegram from the Acting Viceroy of Wuchang to the governor of Hunan, thanking him for his proposal to except relief rice for Hupei from the prohibition, and trusting that the amount sent would be a quota of 100,000 piculs a-month for a period of six months only.
Writing on the 7th April Mr. Fraser stated that the governor of Hunan had again telegraphed to the Throne that in view of increasing prices in Changsha he did not propose to help Hupei. He pointed out that there was no admission of illegality of the governor's action previous to the 16th March, though this as a matter of fact would appear to be implied in the issue of the new notification. On the other hand Mr. Fraser stated that it was a step forward that Hunan bad had to allow a precedent to be set up against export prohibition without due notice and without reference to the Central Government.
The voluminous correspondence on this question is closed by a further note to the Wai-wu Pu from Mr. Max Müller on the 13th April, in which he restated his former conditions, and asked for a reply to his note of the 22nd March, He also requested to know what instructions were sent to the Viceroy and governor, as he understood that no satisfactory arrangement had been arrived at. No reply has so
far been received to this note.
It is significant to note that the rice riots in Changsha broke out on the 13th April. Liang-tun-yen, at an interview with Mr. Max Müller and the Wai-wu Pu on the 20th April, stated that the people of Changsha were inflamed against the governor for having allowed free export during twenty-one days. He added that this was owing to ignorance of treaties. Mr. Max Müller replied that according to his information there had been great speculation in rice, and that this was the most serious factor in the case.
H. PHILLIPS,
Peking, April 22, 1910.
Enclosure 2 in No. 1.
Assistant Chinese Secretary.
Mr. Max Müller to Wai-wu Pu. Your Highness,
Peking, May 11, 1910. HIS Majesty's consul-general at Hankow has drawn my attention to an illegal restriction placed by the Hunan provincial authorities upon the transport of rice between Changsha and other treaty ports with the exception of Hankow.
According to the treaty provisions relating to the subject (which may be found in rule 5 of the Rules of Trade made in pursuance of article 26 of the Anglo-Chinese Treaty of the 5th September, 1902), rice and other grain may be carried by foreign merchants from one port of China to another under the same conditions in respect of security as copper cash," and the procedure shortly is that the shipper gives notice of the amount of rice and the port of destination, and, on depositing satisfactory security with the Imperial Maritime Customs, receives a certificate which has to be returned within six months of the date of clearance. In cases of expected scarcity or famine from whatsoever cause in any district the Chinese Government is entitled, on giving twenty-one days' notice, to prohibit the shipment of grain or rice from that district, and notifications of prohibitions are made by the governors of the provinces
concerned.
The facts of the present case are as follows:-
In October 1907 the governor of Hunan, without issuing the notification above- mentioned, ordered the Commissioner of Customs at Changsha to post a notice that no ports beyond Hankow would thereafter be inserted in the certificates for the transport of rice. This action was not in conformity with the treaty provisions, but in practice the injury to foreign trade which might have resulted was avoided by the Commissioner of Customs at Hankow endorsing Changsha certificates on to other
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