I
15
335
14
customs revenue. They suggested, therefore, that the Commissioner of Customs should be instructed to make a monthly provision for the service of this log from the customs revenue, so as to put it upon the same footing as the Angl German loans, any deficit in respect to the indemnity service to be met out of salt revenue. This was agreed to.
"It will be seen therefore that, in accordance with the procedure finally adopted, the balance of the revenue available after payment of the monthly instalments due for the Russian Loan of 1895 and the Anglo-German Loans of 1896 and 1898 is not all to be divided amongst the banks charged with the indemnity service in proportion to their share of that service, but only up to the amount of the instalment of the indemnity service due to them for the current month.
3. The above procedure was confirmed in the despatch of the doyen to the Wai-chiao Pu of the 20th July, 1915, subject to the following additional reservation of the right of any interested Power to insist that, in the event of any doubt arising as to the sufficiency of the maritime customs revenues and the salt revenues to defray all charges secured thereon in respect to the loan and indemnity service, the payinents of the proceeds of naritime customs revenues to the indemnity banks shall be deferred until full provision has been made for meeting the service of the loans contracted prior to 1900.
"4. As the memorandum declares that it is the intention to leave unchanged the existing order of things, the above procedure should be observed up to the point when the banks charged with the service of the indemnity would in ordinary circumstances remit to their respective Governments in gold the amounts received as above, but instead of so remitting them are now to pay them over to the Chinese Government.
5. The following procedure, in essential conformity with the proposals of the memorandum, is therefore proposed for the operation:
"(a.) On the last day of each month, when the service of the indemnity becomes due, each of the allied banks, instead of transferring the funds in gold to the credit of its Government, as they do at present, shall hand to the Chinese Government a cheque in taels equivalent at the rate of the day to the sum which the Customs would have paid to them to effect this transfer, it being understood that the Russo-Asiatic Bank will give a cheque only for the amount of the share agreed to,
C
(b.) In making this payment each bank will obtain from the agent of the Chinese Government duly authorised to receive these funds a receipt in triplicate for the tael equivalent at the rate of exchange fixed of the gold sum which would have been reinitted. These receipts will furnish to each Government a voucher for the ultimate recovery of the amount due to them in gold which should be reimbursed in taels at the rate of the day on which such reimbursement is made.
Accepted by the undersigned:
"December 21, 1917.”
"J. N. JORDAN. "G. HAYASHI.
PAUL MAY.
"Prince N. KOUDACHEFF.
"D. de MARTEL.
"J. B. de FREITAS.
The second, which was formally communicated to the Chinese Government, runs as follows:-
"In view of the impending suspension of the payments of the Boxer indemnity, the undersigned representatives of Belgium, France, Great Britain, Italy, Japan, Portugal and Russia, have the honour to state that they consider it desirable to settle forthwith the procedure by which the transfer to the Chinese Government of the funds freed by the suspension of the service shall be effected.
They have accordingly agreed upon the following:-
"(2.) On the last day of each month, when the service of the indemnity becomes due, each of the allied banks, instead of transferring the funds
CL
in gold to the credit of its Goverment, as they do at present, shall hand to the Chinese Government a cheque in taels equivalent at the rate of the day to the sum which the Customs would have paid to them to effect this transfer, it being understood that the Russo-Asiatic Bank will give a cheque only for the amount of the share agreed to. (b.) In making this payment each bank will obtain from an agent of the Chinese Government duly authorised to receive these funds a receipt in triplicate for the tael equivalent at the rate of exchange fixed of the gold sum which would have been remitted. These receipts will furnish to each Government a voucher for the ultimate recovery of the amount due to them in gold which should be reimbursed in taels at the rate of the day on which such reimbursement is made.
"It is requested that the name of the agent authorised as above by the Chinese Government should be communicated as soon as possible to the under- signed.
'Peking, December 22, 1917.”
J. N. JORDAN.
G4
G. HAYASHI.
EL
PAUL MAY.
K
Prince KOUDACHEFF.
+4
D. de MARTEL.
**ALIUTTI.
"B. de FREITAS.
51. In a subsequent exchange of notes with the French Ambassador in London, M. Camban, Mr. Falfour upheld our point of view.
July 8, 1918 ("Loans and Concessions,"
Part VI, No. 74.)
Te
M. Cambon, Aug-16.
("Loans and Concesions," Fart VI,
No. 60.)
No, 386,
Concessions,
52. Meanwhile, owing to good customs returns, the customs surplus again began to Peking. swell, and in October 1917 a second release of 2,000,000 taels was agreed to by Nov. 12, 1817 the Diplomatic Body. Within a few weeks the Chinese Government made yet a third ("Loans and application, but this time in a slightly different form. They suggested that it would Part VI, simplify matters if the net balance of revenue for the forthcoming quarter were No. 4) transferred to them automatically at the end of each month.
53. The Diplomatic Body refused to accede to this, and one of the considerations actuating them was a fresh complication that seemed imminent. The possibility of trouble with the South suggested itself for the first time. Should the Canton Government take the not unnatural view that the surplus revenue-which was partially at least drawn from the Southern ports-was being applied to their destruction by the North, it might well lead to an interference by the Southern authorities with the customs aiministration at the Southern ports, which was much to be deprecated. Later, other Peking, counsels prevailed, and during the next two months releases of 4,000,000 taels and No. 27, 1917. 2,000,000 taels were agreed to. For the moment the question of the South dropped, "Loss and but it will be reverted to and dealt with more fully later.
Russian Indemnity.
54. The Allied Powers, with the exception of Russia, had all agreed to suspend the whole of their share of the indemnity for a period of five years, commencing the 1st December, 1917. As regards the Russian indemnity, the Russian Government had only agreed to suspend a proportional amount one-third of the payments due to But with them. Certain payments thus continued to be made on Russian account. the collapse of any recognised Government in Russia, the Chinese Government became nervous lest they should later be called to account for making the payments to a discredited Russian Minister. It was only on receiving
assurance that the Governments of Great Britain, Japan and France considered China justified in continuing those payments, in view of an undertaking given by the Russian Minister,
au
No. 388,
Concessions, Part VI, No. 22.)