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PUBLIC RECORD OFFICE

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TILTIC.O. 882

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PUBLIC RECORD OFFICE, LONDON

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missioner at Wei-hai-Wei, in which he raises the question of the possibility of con- structing a railway from Wei-hai-Wei to Chefoo.

2. There appears to be nothing in the wording of the pledge given to Germany in 1898 to prevent the grant of a concession for the construction of a railway within the leased territory, but whether, assuming that no objection is raised by the Chinese authorities, it is permissible to construct a railway to Chefoo seems to be uncertain. I am to enquire whether, Chefoo not being, strictly speaking, " in the interior of the province," Lord Lansdowne considers that His Majesty's Government is precluded from granting permission for the construction, with the consent of the Chinese Govern- ment, of a line from Wei-hai-Wei to that place.

I am, &c.,

3754

SIR,

No. 100.

COLONIAL OFFICE to TREASURY. [Answered by No. 103.]

1

C. P. LUCAS.

Downing Street, July 11, 1902. WITH reference to the letter from this Department of the 11th March last,* relative to the proposal to make the British and Mexican dollars legal tender in Wei-hai-wei, I am directed by Mr. Secretary Chamberlain to request you to inform the Lords Commissioners of the Treasury that Sir T. Jackson, late Manager at Hong- Kong of the Hong-Kong and Shanghai Bank, intimated, at a recent interview at this ffice, that that bank will be prepared, with their Lordships' approval, to open a branch at Wei-hai-wei, and that, in his opinion, if such a branch were upened, there would be little difficulty in obtaining the general recognition of the British dollar in the neighbourhood of Wei-hai-wei.

2. Mr. Chamberlain is of opinion that the opening of a branch of the Hong-Kong and Shanghai Bank would be of great advantage to the dependency, and he would be glad to learn, at their Lordships' early convenience, whether they see any objection to the proposal, and whether, in that event, they consider that the proposed Ordinance to declare the Mexican and British dollar legal tender in Wei-hai-wei should be issued.

3. I am to add that, pending the receipt of your reply to the letter from this Department of the 11th March,* no communication has yet been made to the Com- missioner of Wei-hai-wei, as proposed in the last paragraph of that letter.

I am, &c.,

28726

SIR,

No. 101.

TREASURY to COLONIAL OFFICE. (Received July 15, 1902.)

C. P. LUCAS.

Treasury Chambers, July 14, 1902.

WITH reference to Mr. Lucas's letter of the 11th March last (3754/1902),* I am directed by the Lords Commissioners of His Majesty's Treasury to transmit, to be laid before Mr. Secretary Chamberlain, a copy of correspondence which has passed between this Department and the Hong Kong and Shanghai Bank on the subject of the proposed introduction of the British dollar as legal tender at Wei-hai-wei.

Mr. Chamberlain will observe that the bank, while in favour of the proposal and anxious to do all in their power to co-operate with the Government of the dependency, are not sanguine as to the sufficiency of their influence in the region in question to secure the general recognition of the coin in the surrounding territory which would be required if the experiment is to succeed.

It is understood, however, that a proposal is now under consideration which may improve the prospect, and my Lords will await a further communication from Mr. Chamberlain before coming to a decision.

No. 36.

I am,

&c.,

E. W. HAMILTON.

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Enclosure 1 in No. 101.

TREASURY to the HONG-KONG AND SHANGHAI BANKING CORPORATION, LIMITED.

(4347/02.) GENTLEMEN,

Treasury Chambers, April 16, 1902. As stated in the Treasury letter of the 6th September, 1900, the Lords Com- missioners of His Majesty's Treasury have been in communication with the Colonial Office with reference to your proposal that the British dollar should be made legal tender at Wei-hai-wei, and enquiries have been made locally as to the possibility, if an Ordinance were enacted with that purpose, of maintaining the coin in effective circulation in that region of China on a par with the issues of the Mexican dollar, which are now current there.

My Lords are advised that unless an arrangement can be arrived at to secure the acceptance of the British dollar as equivalent to the Mexican in the walled town of Wei-hai-wei, and also by the foreign banks at Chefoo, there is little prospect that the proposed legislation would have any other effect than to displace the existing currency of the territory under British control by British dollars, which would only be available for transactions with the surrounding districts at a heavy discount. proposal would therefore be defeated, and persons who were compelled to accept the The object of the British dollar at Wei-hai-wei would be placed at such disadvantage that an allowance on that account might have to be made by the Government, which would counter- balance the saving effected by ceasing to raise the present currency at a premium for official purposes,

For this reason my Lords do not think it desirable to proceed with legislative action for the present, unless the necessary assurances as regards the walled town of Wei-hai-wei and the foreign banks at Chefoo can be obtained.

They understand that the Commissioner at Wei-hai-wei is in communication with the Governor of Shantung as to the former. As regards the latter, your Board will probably be in a position to advise them as to the prospects of obtaining from the banks such a promise of recognition and assistance as is contemplated by the Com- missioner, and I am to invite your observations on the subject.

I am,

&c., E. W. HAMILTON.

The Directors of the

Hong-Kong and Shanghai Banking Corporation, Limited,

31, Lombard Street, E.C.

SIR,

Enclosure 2 in No. 101.

HONG-KONG AND SHANGHAI BANKING CORPORATION, LIMITED, to TREASURY.

Hong-Kong and Shanghai Banking Corporation,

31, Lombard Street, London, E.C., July 4, 1902. REFERRING to my letter of April 17th last, which was a reply to your letter, No. 4347/02, I now beg to hand you a copy of extract from a letter received from our Shanghai Manager on the subject of the circulation of the British dollar at Wei-hai-wei and Chefoo.

I have, &c.,

Sir Edward W. IIamilton, K.C.B., Assistant Secretary,

His Majesty's Treasury,

J. M. TOWNSEND,

Manager.

EXTRACT from Letter received from the Manager of the Hong-Kong and Shanghai Banking Corporation at Shanghai, regarding the circulation of the British dollar at Wei-hai-wei and Chefoo, China.

Last August we had an enquiry from the Flect Paymaster with regard to the introduction of the British dollar as legal tender at Wei-hai-wei. The following is the gist of what we wrote him, and our views are similar to-day.