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apart from that fact the Chinese management shows little dis- -position to help through traffic by punctual running of trains or
otherwise.
6.
Through traffic has also been discouraged by
the imposition by the Chinese of likin on goods carried by the Railway, contrary to the arrangement arrived at in the draft Working Agreement and accepted by the Manchu Government. The management of the Chinese Section estimate that the imposition
of likin involves a loss in traffic receipts of $500 a day on that
Section alone. This Government has already sought the good
offices of His Majesty's Minister at Peking in protesting against
the imposition of likin and I shall address you separately on the
subject.
7.
The Chinese Section of the Railway is short of
locomotives and rolling stock. Their existing stock is only just
present
sufficient to maintain the train service and they have no funds
A
with which to purchase more. I am assured that unless additional stock can be obtained traffic on the Section must be suspended in six months time for necessary repair of locomotives. The British and Chinese Corporation has offered to lend £25,000 for the pur-
-chose of the necessary stock, but the Government at Peking has
declined the offer. The matter is a most serious one for this
Government and for the management of the Chinese Section. Their Bost urgent need is locomotives and the only method of avoiding suspension of the through traffic until the Chinese Section is provided with necessary funds for its relief, is for the British Section to hire to it one of its engines to haul a daily train to and from Sheklung. This the British Section is in a position to do if reasonable terms for the accommodation can be arranged. The Manager of the Chinese Section has already asked for this assistance and I shall report in due course tae result of the
negotiation.
8.