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supporters.
I think, therefore, that an effort should
be mude to include the loop line in the major scheme
in the hope that it will be accepted in return for immediate
financial assistance. But if it appears that the resistance
offered is likely to wreck the whole project, it would be
better to finance the main line and leave the loop question
in abeyance for the present. Too much pressure will only
defeat our own ende, as it is fatal for any Chinese
administration to appear to be acting at foreign dictation.
When the main line is build, economic reasons will sooner
or later convince the Chinese of the necessity for linking
it with the other railway, and they may be left to realise
the practical merits of this in their own time. Even without
the Junction, the completion of the main line is bound
to benerit Hongkong with the additional traffic that it
will bring. at all events there can be no disadvantage to
British interests, for although there is no reason to
suppose that the railway will be better managed than other
lines in South China, in this case the defaults and losses
will have to borne by Chinese educational institutions
and not by British bondholders.
5. As regards the Chinese mentioned in Mr. Giles
despatch, Mr. Chu said that Mr. Li Yuk Tong was a
Hongkong merchant known to the authorities in Canton,
but not in close touch with them. He did not appear to
Anow any of the others.
I have, eto.,
(Sgd) J..Brenan.
Loting Consul-General.