2
110
the first instance to use the funds for the rehabilita-
tion of existing lines as being more immediately
advantageous to China then new construction; that
preference will be given to those railways in which
there is a British financial interest, and that all
orders for bridges, locomotives, rolling-stock, rail
and all other railway equipment, purchased out of
British indemnity funds shall be placed in the United
Kingdom. The note should go on to say that the money
thus advanced by the trustees of the Indemnity Fund
will be regarded as loans to the railways in question,
bearing a fixed rate of interest which will form the
educational endowment envisaged by the Buxton Advisory
Committee. Further, as an immediate contribution to the
educational purposes of the fund it is the desire of
the National government that out of the accumulation now
on deposit a sum of £200,000 should be transferred to
Hongkong University and a sum of £200,000 should be
placed at the disposal of the Universities Committee in
London for the assistance of Anglo-Chinese studies
It is also their intention as future instalments become
due that besides the principal purpose of railway
rehabilitation they shall also be partly applied to
immediate educational purposes within the scope of the
recommendations of the Buxton Committee. If these
proposals recommend themselves to His Majesty's
Government the National government will proceed to
•
appoint a Board of Trustees to administer the fund on
these lines.
4......