18
situation in China resulting in there being no chance
of securing reparation. Chinese authorities might
bewilling to accept an allocation from the Boxer Funds
I
on this account if earmarked for purchasing of
additional locomotives and rolling stock which would
then be hired to the Chinese section by the British
section. Agreement proposed in my secret telegram of
15th September 1928 has not yet been concluded and if the British Section were enabled by the present
proposal to purchase and own these engines the
traffic would be so improved that it would pay to
hire them to the Chinese section at a rate based as
at present upon the running cost and depreciation charging
nothing for interest. As the engines would be
owned and maintained by the British section their life
would be prolonged.