PUBLIC RECORD OFFICE
Reference :-
TTIC.O. 882
8
PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO
4
sug-
Eastern
No. 88,
p. 27
11
In a later despatch (of 20th May), he gested that if the concessionaires would not undertake to proceed with the immediate con- struction of the line, His Majesty's Government should induce the Chinese Government to cancel the concession, and grant a new one to the Colonial or Imperial Government, or to company nominated by either of them the Colonial Government to guarantee 4 per cent. on the cost of construction for such term of years as might be necessary to attract capital, and the Imperial Government to back the Colony's guarantee.
;
4. In April, 1904, a Draft Proposal was Eastern privately submitted to the Colonial Office by the No. 88, Corporation, the parties to which were to be the Pp. 16-18, Hong Kong Government, the Chinese Govern- ment, the British and Chinese Corporation, and the projected British Railway Company. The principal points in the proposal were:-
(1) The Corporation to surrender to the Chinese Government their existing Agreement.
(2) The Chinese Government to grant to the Government of Hong Kong the exclusive right to construct and work, by means of a British Com- pany, a railway from the Kowloon frontier to Canton.
(3) The Hong Kong Government to grant a concession to a British Railway Company, to be promoted by the Corporation, to construct a railway from Kowloon to Canton.
(3) Lands required for the railway within the respective territories to be pro- vided free of cost by the respective Governments.
(4) The concession to be granted to the Corporation and to be transferred by them to the Railway Company in consideration of the issue to the Corporation, "free of cost and with- out payment or liability and as fully paid,
per cent. of all the
capital issue of the Railway Com- pany, of whatever kind, appropriated to the railway."
(5) During construction, the Hong Kong Government to pay to the Com- pany 3 per cent. on the full nominal capital, and after completion to guarantee 3 per cent.; the Company to pay to the Government the net earnings during construction, and half the surplus net profits thereafter. (6) The Government to have the right
after
years to take over the railway on payment of an amount equal to the whole capital plus any reserve funds, and of an amount
Eastern
No. 88,
pp. 21-22.
Eastern
No. 88,
pp. 23-25.
equal to
5
times the average
annual net profits for the last three
years (with a limit of of the total capital).
per cent.
5. The Secretary of State did not accept this proposal, as he considered that it was undesirable for the Colonial Government to ask for such rights in Chinese territory or to guarantee an undertaking beyond its own jurisdiction. On 3rd May, 1904, he suggested to the Corporation as a counter-proposal that the Colonial Govern- ment should construct the part of the line in British territory and lease it to the Corporation (or the British company promoted by it) to be worked in conjunction with the part of the line to be constructed within Chinese territory under the existing Agreement.
"
6. On the 3rd June the Corporation replied that they viewed favourably this counter-proposal and were willing to proceed to negotiate with the Chinese Governinent for a "Final Agreement for the issue of a Chinese Railway Loan; such agreement to be on the lines of the Shanghai- Nanking Agreement, but to include provision for the working, as one undertaking, of the line constructed by the Government of Hong Kong. They enclosed a Memorandum in which it was stated that the position consequential on the proposal of the Colonial Office was as follows:-
"(1) The Corporation must float a guaran- teed Chinese Loan for the construc- tion of the railway from Canton to the Kowloon frontier.
"
"(2) To make the communication through to Hong Kong the Colonial Railway must be in some way associated with the Chinese Railway, by direct agreement with the Chinese, or through the British and Chinese Corporation.
to
(3) The association of the Colonial Rail- way with the Chinese Railway should be made dependent upon the Chinese Government agreeing to such man- aging arrangements as will ensure the railway being worked to the best advantage; for instance: The Board of Commissioners appointed manage the railway, and which under present conditions would con- sist of three Europeans, including the Chief Engineer, and two Chinese, should be strengthened by, say, two nominees of the Colonial Govern- ment, and the Board of Commis- sioners should be made absolutely free to manage the line to the best advantage, and according to the
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