2

The Opium Agreement of 1911 provides for the total extinction of the trade by the end of 1917, and thus the coming spring will be the last season during which inspections under the agreement. can be made. There are indications that the Chinese Government is uneasy as to what is going to happen at the expiration of the stipulated period, and a National Opium Prohibition Conference has been meeting daily in Peking aince the 10th instant to devise immediate measures for the suppression of the evil It is hoped therefore that the representations that have been made, as reported above in connection with the Kuangsi incident, will strengthen the hands of the Central Government in dealing with the recalcitrant provinces.

(Copy to India.)

[This Bocument is the Property of His Britannic Majesty's Government.]

80.

20067

OPIUM.

RECO REG 19 PE 17

[February 3.]

CONFIDENTIAL.

SECTION 1.

I have, &c.

B. ALSTON.

[26646]

No. 1.

Mr. Alston to Mr. Balfour.-(Received February 3.)

(No. 45.) (Telegraphic.)

Peking, February 2, 1917.

FOLLOWING telegram received from Shanghai :

Opium.

-

"Ezra asks me to telegraph that, subject to consent of His Majesty's Govern- ment, combine has signed agreement with Vice-President Feng to hand over stock on 31st March against 6 per cent. bonds at the rate of 8,200 taels per chest for Chinese authorities to dispose of as medicine.

With a

"Bonds are those of first year of republic and not special opium bonds. view to making parliamentary sanction unnecessary, they are to be paid off in ten years at latest with yearly drawings.

"All opium holders here and in India have agreed. Stock now about 2,700 chests, but 500 or 600 expected to be sold and delivered meanwhile,

He promises letter with full particulars in a day or two."

I await copy of agreement before submitting observations. With reference to my telegram No. 35 of 22nd January, I think inspection of provinces should proceed irrespective of any arrangement for disposal of stocks.

(Sent to India.)

[2662 c)

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