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PUBLIC RECORD OFFICE

Reference :—

LHC.O.882/11

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

PUBLIC RECORD OFFICE, LONDON

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thereby giving the impression that the Canton Government had acquiesced in the proposal. The Canton Government could not understand why Mr. Fletcher said that it had agreed to do certain things when it had not. And yet all the officials who knew Mr. Fletcher knew that he was an honourable man. How, then, did the misunderstanding arise? Mr. Chan King-po, who acted once or twice as unofficial intermediary for Hongkong, informed him and Mr. C. C. Wu that Mr. T. V. Soong, the Minister of Finance. had agreed to the proposal that Hongkong should send up some elected Chinese merchants to meet the strikers. Mr. Foo could not say whether Mr. Soong had expressed such agreement-he might have done so-but Mr. Soong denied it when questioned, In any case Mr. Soong had no authority from the Canton Govern ment to agree definitely to anything when he was sent down to Hongkong to see the Governor, and he certainly made no men tion of this point when reporting the conversation he had with the Governor and the Hongkong officials. His report covered much of what the Governor and Mr. Fletcher said to him, and very little of what he himself said. Herein probably lay the germ of the misunderstanding over the visit of the eight Chinese dele- gates to Canton. We informed Mr. Foo that we heard from Mr. Fletcher immediately on his return from Canton, that Mr. Soong did say something to Mr. Fletcher to the effect that the Chinese merchants in Hongkong could fairly be expected to make a little more sacrifice since the strikers had suffered so much, and they could do so by making a monetary contribution to the strikers. Mr. Foo said that he was certain of the sincerity of the Hongkong Government, but he would ask us to believe that his Government had also been sincere. If it had been otherwise. it would not have deputed Mr. Soong to go to Hongkong to meet the Governor, immediately upon the receipt of a written request from Hongkong to send down a high official for the purpose. Mr. Wong Ching-wei was very desirous of having the whole matter settled in an amicable way. He was a broad-minded man and could appreciate the point of view of Hongkong as well as that of Canton. He would very much like to meet the two Chinese members of Council in Canton, so that he could have a thorough discussion with them, and tell them. at first hand, in what way he could assist in bringing about a satisfactory settlement. Foo thought that Mr. Wong was the one man in Canton who could best help towards that end. In Mr. Foo's view, the so- called "economic "terms-strike pay and reinstatement-seemed to be more important than the political terms. If the former were settled there would be very little difficulty in settling the latter. particularly when the Canton Government had agreed to nego- tiate the 'political questions direct with the Hongkong Government. He thought it would now be most difficult, if not impossible, for Canton to make, or for Hongkong to examine, detailed claims for strike pay or compensation for non-reinstate- ment; and it would therefore seem that a lump sum payment would be the only practical solution. Such a payment could be called whatever we liked. The total amount of such claims had been estimated by the strikers to be about $14,000,000, while the

Mr.

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Hongkong Chinese delegates mentioned a sum of $300,000 as being the most that the Hongkong merchants would be prepared to pay. It seemed to him that the difference between these two figures was so great that the prospects of a settlement were very remote. We said that we must make it clear that the Hongkong Government would never agree in principle to strike pay or to compensation for non-reinstatement of labourers. We also said that although the Chinese merchants had mentioned $300,000 at the time, they might not now be able to raise that sum, even were they still willing to negotiate on that basis, as nearly three months had elapsed, and the community had suffered further financial losses. Mr. Foo then raised the question of a loan from the Hongkong Government for the construction of railways. This loan, he said, was proposed by Mr. Fletcher when he was in Canton, and he thought that if it materialised it would at once re-establish friendly relations between Hongkong and Canton. But it would be obviously impossible for the Canton Government to forsake the strikers as soon as a loan was obtained from Hong. kong, as the strikers were animated by patriotic feelings. The Canton Government therefore proposed to apply a portion of that loan to paying off the strikers. We said that we heard of the proposal of a loan from Mr. Fletcher on his return from Canton, but we were not acquainted with the details, though obviously one of its objects was to enable the Canton Government to find employment for the large number of idle men now said to be in Canton. We thought that a loan of this nature must be sub- ject to special terms and conditions to be mutually agreed upon, including some control. To apply a portion of it to a purpose for which it was not made, namely, payment to the strikers, would be camouflage, pure and simple. Mr. Foo answered that it would not be camouflage, because the loan would be made against suit- able security and on special terms and conditions: and so long as the borrower would in due time repay the money, he could surely employ a portion of it for a desirable object. After all, this proposal was made in order to settle this very difficult problem. If Hongkong could not or would not pay, the Canton Government. with a desire to end the trouble and to be friendly with Hong- kong, now offered to make some payments to the-strikers-an action which was a proof of sincerity and friendliness. He thought that this would seem to be the best way out of the diffi culty, and he earnestly commended it to the consideration of our Governor. Every day's delay would mean further losses to both Hongkong and Canton, for the two places depended on each other for their prosperity. We assured him that the Hongkong Government would certainly like to see Canton prosper, and would give practical help towards that end. As an instance, we reminded him of Sir Edward Stubbs' expression of readiness to assist Canton in improving its land system, and we also mentioned this very proposal of a loan made through Mr. Fletcher. Mr. Foo said that such practical help from Hongkong would go far towards re-establishing friendly relations, and would undoubtedly be better than monetary payments to the strikers by Hongkong,