PUBLIC RECORD OFFICE
Reference :-
111 C.O. 882
6 PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO
204
Offers from such people as Paulings to construct at the rate of £5,000 or £6,000 will have the natural effect of still further prejudicing the Chinese against the British and Chinese Corporation.
However, I am told that the latter are not really anxious to undertake the Canton-Kowloon Railway, and possibly they might be willing to abandon it, if their out-of-pocket expenses were refunded. You know better than I if this is feasible.
I regard negotiations with Sheng as impossible, and with the Viceroy of Canton as very difficult. At the present moinent there is a strong set, both at Peking and in the provinces, against allowing foreigners any control over Chinese railways, and we shall have to count with that.
This letter is already too long, but I thought I must tell you exactly how these matters present themselves to my vision.
Yours, &c.,
ERNEST SATOW.
Sub-Enclosure 1 to Enclosure 2 in No. 144.
HIS BRITANNIC MAJESTY'S CONSUL-GENERAL, Hankow, to HIS BRITANNIC MAJESTY'S MINISTER, Peking.
Hankow, July 23, 1905.
DEAR SIR ERNEST SATOW,
As you will have seen from the telegram sent to-day, the summary is in Chang's hands.
I took my courage in both hands and wrote Sze a very stiff note about his message of Thursday (20th July), half expecting that Chang would show his hand by saying that, as we were so unreasonable, he would try elsewhere. Sze, however, sent an apologetic reply, and was sent over yesterday evening full of excuses and explanations, which amounted to a confession that Ts'en was riding the high horse, I said that and proving a most unpleasant partner for Chang in this transaction. in any case it would not hurt Chang to promise to do his best to hurry up the Canton-Kowloon agreements, provided that he found them, as we were sure he must, reasonable. I also pointed out that the payers of the piper should have some say in calling the tune, and suggested that if Chang would borrow Kinder as chief engineer of the Hankow-Canton line, there would be no fear of even Japanese objecting to work under a man so well tried and approved by China. Sze admitted that it would be an ideal arrangement, could it be managed. He is to let me know as soon as he can whether Chang will be ready promptly to talk over the Canton- Kowloon line agreements and to consider the draft of loan agreement, which I shall I have drafted it on the 1900 Loan Agreement model, and post to you to-morrow. shall not present it to Chang until I hear from you.
We are anxious to hear about the Canton Viceroy's attitude. Sze believed that Chang had telegraphed to him again and got another snub in reply. Ts'en is reported to lack the equable temper of his brother, the former taotai, now judge of Hupei.
Frankly, I feel the force of Chang's objection to making his payments contingent on the completion of the railway agreements, and cannot find an answer to him. And even though he was bluffing about rival offers, I do not believe he would ever accept such an arrangement.
Sze was sure that there was no doubt about Morgan's carrying out his agree- ment, at least by latest advices.
DEAR SIR ERNEST SATOW,
Yours, &c..
E. H. FRASER.
Hankow, August 10, 1905.
HEREWITH I send two characteristic letters from Chang:* copies and trans- lations have likewise gone to Hong Kong. I thought for a moment he was lying about the Canton-Kowloon Railway, but of course he means that our original request was for an assurance thereanent from Ts'en only. His railway capital, &c., assur- ance is good, and I fancy there will be no difficulty in extending it to cover other lines than the Canton-Hankow.
• He enclosure No. 3 to my weret despatch of 26th August, 1905 (No. 138).
205
I am not calling on Chang, as last night he sent his chief secretary with the news I telegraphed to you to-day, and the old man is very tired after holding an examination.
Wang told me that the Szechuen Viceroy had telegraphed suggesting that the Chinese Ministers abroad be told to send him all the passed Chinese railway students now abroad to survey his railway, and that Chang held that Hsi must get a foreigner. I told him to impress on Hsi through Chang that for such a difficult line he must have the best engineer available, and he should telegraph to the Chinese Ministers abroad to ascertain who were the best. Wang asked what such a man would cost, and I told him £400 or £500 a month, at which he gaped; but he saw the cheapness in the end.
I told Wang about Rockhill's remark, and said I thought he was fishing for information. Wang repeated text of the preliminary agreement for resale of con- cession, and swore it was quite unconditional. I do not now see how the United States Government can break it or prevent the transfer at this late date, but Morgan's delay looks suspicious. Reith's information was given seriously, but, as I told Wang, no Government can ask where another Government gets the money which it offers. King Leopold's interference has put Chang very much against having Belgians on the Lu Han longer than is inevitable.
By the way, Chang was perturbed by the telegram about our having agreed with France as to railways in China. I, of course, had no information to give him.
He said the Americans had surveyed the Canton-Hankow Railway, but I suggested it was only a hasty survey, and he had better try and borrow Kinder to check it.
I am off to Kuling to-morrow for three days. Chang is to send me a private Chinese cypher in case he wants to communicate with me. The draft agreement will be ready for discussion, I hope, on my return.
Sub-Enclosure 2 to Enclosure 2 in No. 144.
E. H. FRASER.
HIS BRITANNIC MAJESTY'S MINISTER, Peking, to HIS BRITANNIc Majesty's CONSUL-GENERAL, Canton. (Private.)
MY DEAR SCOTT,
British Legation, Peking, August 18, 1905. WITH reference to the Canton Viceroy's telegram to the Waiwupu about the Canton-Kowloon Railway, as published in the Chinese press (Hong Kong, 11th instant).
Unless the language of this telegram is mere pretence the Viceroy appears to be genuinely anxious in regard to the political consequences of allowing British capitalists to build the Chinese section of this railway. He must not forget that the British and Chinese Corporation have a preliminary agreement, but it might help to relieve his fears if you were to point to the effect on the position of the Peking-Shanhaikwan-Newchang-Hsinmintun railways at a critical juncture of the employment of British capital in those lines.
His Excellency must be aware of the facts. All those railways fell into the hands of the Russian military authorities in 1900, during the Boxer troubles, and if the fact of a British loan or mortgage had not entitled the British Government to intervene, in the firm and insistent manner disclosed by the Blue Books, those railways could not have been withdrawn from Russian control, and they would without question be now Russian railways.
However, the British Government, at a considerable risk of political compli- cations, compelled the Russian Government to relinquish the railways, and they were eventually returned to the Chinese Administration by the British Government, free from our control, and under conditions which guarded the Chinese Government against granting unwise railway concessions in the neighbourhood of Peking to Powers that have shown themselves less disinterested than themselves.
The action of the British Government in this matter is an eloquent testimony to their attitude towards Chinese railways. There is no foundation in facts or in the policy of the British Government for His Excellency's anxiety.
China has neither the funds nor the technical experts necessary for the con- struction of railways, and she must obtain foreign assistance. Under these circum-