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The
Chinese Government however times have changed, and the Agree-
-ment is out of date. It's objects are, in the words of the
preamble, to safeguard the revenue of the Chinese Maritime
Customs and to secure reciprocal benefits of trade and
commerce, but it is doubtful whether, in its result, it
would do much more than accomplish its first intention.
main attraction of the Agreement, as far as this Colony is
concerned, lies in Article IX; and it is admittedly most
desirable that local merchants should have the opportunity of
sharing in the extensive trade between North and South China
which now merely passes through the Colony. The restrictions
however of Article IX, the bonds and other formalities
required, must involve expense and may prove as much a
deterrent as the present Customs duties. On the other hand
the Colony is asked to undertake Police work which will in-
-volve much expense and trouble, in order that the Chinese
Customs revenue may be immensely increased. The balance of
advantage is too much in China's favour.
5.
In any event this Government is not
prepared to agree to the signature of an agreement, the
operation of which will be indefinitely postponed. The
existing administrative chaos, the instability of the Govern-
-ment at Peking, and the disaffection of the Southern Party,
in whose territory the Agreement is to operate, all point
to the conclusion that this Government, by its signature,
would place itself in a position of no present value and of
great potential disadvantage.
6.
I would ask Your Excellency therefore
to inform the Chinese Government that, as the existing
political situation precludes the possibility of putting the
Agreement into full operation, this Government is not pre-
-pared to continue the negotiations, and that in view of
changing circumstances it considers itself to be under no
obligation to resume them, at least in their present form,
when