[This Document is the Property of His Britannic Majesty's Government.l
OPIUM.
CONFIDENTIAL.
(29738)
No. 1.
575
V.0.
[July 13]
SECTION 1.-E
**RE O AUG 12/
f
Chartered Bank of India, Australia, and China to Foreign Office.--(Received July 13.)
Sir,
4
38, Bishopsgate, London, July 12, 1912.
FOR the information of Sir Edward Grey, we beg to enclose herein copy of a letter dated Shanghai, the 15th ultimo, signed by all the foreign exchange banks established there, addressed to M. D. Siffert, consul-general for Belgium and doyen of the consular body at Shanghai, for transmission by telegram to the foreign Ministers at Peking, in connection with the critical state of the opium trade in China, brought about by the Chekiang authorities having prohibited, since February last, the importation of and trade in Indian opium, in absolute contravention of existing treaties, causing an accumulation of stocks in Shanghai and heavy depreciation in their value. In financing and making advances on shipments of opium from India to China in the ordinary course of business this bank provided for the ordinary market risks, and placed full reliance on the British Government seeing that the Chinese Government duly fulfilled its obligations in the matter of international treaties and agreements.
We are advised that while prohibiting the trade in Indian opium it is a matter of common knowledge that the Chekiang authorities have allowed the cultivation of the native drug in that province to continue unabated, and that it is sold freely in the Shanghai market.
We understand that the foregoing facts have already been brought to the notice of His Majesty's Minister at Peking by the opium merchants, and that as the result of his representations the Peking Government, while expressing their desire to adhere to the treaties and agreements of the former Governments of China, declare their inability to impose their wishes on the Chekiang province.
The foreign banks at Shanghai recognise the difficulties of the Peking Government in providing protection for foreign trade in distant parts of the republic, but they fail to see how it can be seriously contended that the Peking Government is unable to exact obedience to its wishes in a province so easily accessible as Chekiang. They therefore respectfully asked the consular body to transmit their protest to their respective Ministers at Peking, and to request the Ministers to protect their interests either by insisting on the Government enforcing the adherence of the Chekiang province to existing treaties and agreements, or by obtaining a promise from the Central Government to make good any losses the banks may sustain by the illegal interference with legitimate trade by the Chekiang authorities.
My directors rely upon the British Government taking the necessary steps to protect this bank's interests.
I am desired to add that the foreign exchange banks at Shanghai who have signed the protest represent Great Britain, Germany, France, Russia, America, Belgium, Holland, and Japan.
Enclosure in No. 1.
I am, &c.
WM. NOGGAN.
Sir,
Letter addressed to the Senior Consul.
Shanghai, June 15, 1912.
THE undersigned banks have the honour to draw the attention of the consular body to the critical state of the opium trade. For many years past it has been the custom of the different banks to finance shipments of opium from India to this port, and in the ordinary course of business to make advances on the same when it has been stored here waiting sale.
In making such advances they have provided for the ordinary market risks, but have depended on the Chinese Government fulfilling its obligations in the matter of international treaties and agreements.
[2549 n-1]