CO882-6 — Page 612

PUBLIC RECORD OFFICE

Reference :-

TLC.O. 882

6 PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO

194

Copy of this despatch, omitting the portion which relates to differences with the British and Chinese Corporation in regard to the Shanghai-Nanking Railway, is being forwarded to the Governor of Hong Kong.

The Marquess of Lansdowne, K.G.,

&c., &c.,

35985

(Secret.)

&c.

No. 144.

I have, &c.,

ERNEST SATOW.

GOVERNOR SIR M. NATHAN to MR. LYTTELTON.

(Received October 9, 1905.)

[Copy to Foreign Office, October 12, 1905. L.F.]

SIR,

Government House, Hong Kong, September 8, 1905. IN continuation of my secret despatch of August 26th, 1905,* I have the honour to enclose, for your information and record, a paraphrase of further tele- graphic correspondence with yourself, His Britannic Majesty's Minister at Peking, and His Britannic Majesty's Consul-General at Hankow, on the subjects of a proposed loan to the Viceroy at Wuchang in connection with the Canton-Hankow Railway, and of negotiations with the Viceroy at Canton for the completion of a loan agreement and of a joint working agreement in connection with the proposed Canton-Kowloon Railway.

2. I also enclose a copy of the letter, dated August 18th, from Sir Ernest Satow, referred to in his telegram of the 23rd (XLIX.), and in mine of the 30th August (LI.), together with copies of the letter it covered.

3. The third enclosure is the draft of the Redemption Loan Agreement, revised as proposed in Mr. Fraser's telegrams of 6th September and 7th September (LXVI. and LXXIII.), and agreed to in mine of the same date (LXVII. and LXXIV.).

4. You will see (LII.) that Sir Ernest Satow did not consider my suggestion of obtaining Japanese co-operation (L.) practicable, and that I thought fit (LIV.) to remove my insistence on the Redemption Loan being made conditional on a direct assurance with regard to the Canton-Kowloon Railways Agreements.

5. The date for the payment of the first instalment of the Redemption Loan was, as you are aware, originally fixed for the 29th September. On the 4th I received information (LVI.) that it was essential that this payment should be made on the 6th instant. I did not, however, feel justified in definitely asking you to cause the payment to be made until I had information that the Loan Redemption Agreement had been signed, and an Imperial Decree sanctioning the loan issued (LVII.).

6. Unfortunately the settlement of these matters was delayed by an inter- ruption of the cable communications north of Shanghai, and by telegrams over the Chinese land lines taking the best part of a day to pass between here and Hankow.

7. In the meantime the Viceroy, fearing cancellation of the Resumption Agreement with the American-China Development Company, in the event of the first instalment not being paid to the day, arranged for the Hong Kong and Shanghai Bank at Hankow to lend the amount of this instalment for one month from Sep- tember 6th, and the money was telegraphed to New York on that day (LX., LXVIII., and LXIX.).

8. Our draft Loan Redemption Agreement has now been modified to provide for repayment of the first instalment to the Hong Kong and Shanghai Bank at Hankow, and the payment of the second instalment to the United States Minister at New York on October 6th (LXXIII. and LXXIV.). I am waiting to hear that the agreement thus modified has been signed before telegraphing to you to arrange for these payments (LXXVI.).

9. The Imperial Decree sanctioning the loan has been issued, and was com- municated officially to His Britannic Majesty's Minister at Peking on the 7th of September (LXXVII.).

• No. 138.

10.

195

As soon as the Redemption Loan Agreement in connection with the Hankow-Canton Railway is disposed of I will press again for completion of the Loan and Joint Working Agreements for the Canton-Kowloon Railway.

I have, &c.,

M. NATHAN,

Enclosure 1 in No. 144.

Governor.

PARAPHRASE OF TELEGRAPHIC CORRESPONDENCE WITH THE SECRETARY OF STATE, HIS BRITANNIC MAJESTY'S MINISTER AT PEKING, AND HIS BRITANNIC MAJESTY'S CONSUL-GENERAL AT HANKOW.

LI.

GOVERNOR, Hong Kong, to His Britannic Majesty's MINISTER, Peking. (Dated August 30, 1905.)

I have received your letter of 18th August. I shall await your reply to my telegram of 25th August, suggesting co-operation with the Japanese, before making any fresh proposals.

You will keep in mind the necessity for an early settlement of the Redemption Loan Agreement, if the first instalment is to be paid on September 29th.-NATHAN.

LII.

HIS BRITANNIC MAJESTY'S MINISTER, Peking, to GOVERNOR, Hong Kong. (Dated August 30, 1905.)

(Despatched 6 p.m.: Received 8.18 p.m.)

No. 11. Referring to your telegram of 30th August, I fear that proposal con- tained in your telegram of 25th August is impracticable, and, at present at any rate, I see no necessity to ask for assistance.

A day or two ago I telegraphed to Hankow to ask about the Redemption Loan Agreement, and as soon as I receive reply I will repeat it to you.

To-day I am writing officially to the Foreign Board to ask them for the name of the person to negotiate with Ross about Canton-Kowloon Railway Final Agree-

A copy goes to you by post.-Satow.

ment.

LIII.

HIS BRITANNIC Majesty's MinistER, Peking, to GOVERNOR, Hong Kong. (Despatched 12.25 p.m., September 2, 1905: Received 8.24 a.m., September 3, 1905.) No. 12. I have received the following from His Britannic Majesty's Consul- General, Hankow :-Two telegrams in cypher were received yesterday from Viceroy, Wuchang. In the first it was stated that the loan question pressed for settlement, and that he was anxious to see me about your views on condition five. The second said that the management of the German Bank in Peking is pressing for assent to his loan scheme, which can be then settled there; but the Viceroy wants to come to an early settlement with us, and thus avoid a crop of complications. To this I replied Indisposition prevents me from arriving in Hankow until September 3rd, and have telegraphed for instructions."

"

I have telegraphed to the Vice-Consul to arrange for an interview on Sunday evening.

I propose to show him the Chinese text of the Canton-Kowloon Railway Agree- ment and urge on him that it is just as binding as the American preliminary agree- ment for the resumption concession, and shall also press for British option for the Hankow-Szechuen fine loan, which can be scarcely pressing, and point out that as on his showing further railway schemes in the three provinces are improbable in the near future, our demand is really even less onerous than would appear.

ار

Must assurance regarding Canton-Kowloon Railway Agreements still be treated as a pressing condition sine que non, or may I get the best terms I can?

be obliged if you would telegraph direct to Hankow as well as to me.—

SATOW.

18883

1 R2