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While, however, forcible action by Canton
must be prevented at all costs, it is difficult not
to admit an element of justification in the claim
now put forward. The content ion that the internal
loans benefited China as a whole is contestable, and
I doubt whether we can return blank refusal to demand
for provincial participation.
Although it may seem a somewhat drastic
measure, the following suggestion might be put for- ward tentatively for consideration by diplomatic
body:-
The powers should make it known to all concerned that, in existing conditions, an equitable distribution of surplus of revenues collected under foreign control seems only attainable by some system of provincial participation in these surpluses; that the bas of such participation must be determined by agreement between the Peking Government and the local authorities concerned; and that falling such agree- ment within a reasonable time, the powers will be compelled either to allocate these surpluses (includ- ing if necessary the customs surplus used for the internal loans) to the best of their ability on an equitable basis or to hold them up entirely until such time as an agreement is reached. It would be a natural corollary to any such arrangement that any province participating in its benefits should refrain from local interference with the Selt. In this way the scheme might also have the much desired effect
of strengthening the Salt administration.
·
We are alive to the anomalies of such a proposal
so long as the Peking Government is nominally
recognised