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** 101

537

carriages will be run at a heavy loss. The scale has therefore been

reduced (increased?) to the rate of one cent per mile, and the ad- -justed scale is as follows:-

112

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3rd.

2nd. Class..

Canton to Sham-chun.

Class.

.90 cents.

.$1.80.

1st. Class..

.£3.60.

Sheklung to Sham-chun.

3rd. Class.

..50 cents.

2nd. Class...

1st. Class

.$1.00

.$2.00 (?)

(Chinese says

20 cents.)

As to the other particulars of the proposed agree- -ment, the Railway Department of Peking thinks that they should be

based on the draft agreement forwarded to you previously, and the

joint-working agreement made between the Peking-Mukden Railway and the

South Manchurian Railway.

The two suggestions of Sir F. H. May agree in general

with the fifteen conditions of the draft agreement of this section

with the exception of this that the number of carriages of the two

sections should be in the proportion of two to eight, which seems to

have certain objections. When the traffic is increased such a propor-

-tion cannot be maintained. It is better that each section should pay

rent to the other for the carriages used, such rate being calculated

by the hour or by mileage.

I attach herewith a copy of the fifteen conditions of

the draft joint-working agreement in Chinese for your consideration,

and shall be much obliged if you will favour me with a reply.

I have etc.,. (Sd.) Chao Ching-Hwa,

Chief Director, Canton-Kowldon Railway.

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