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a trade. The duty on any goods re-exported across the land frontier might be handed over to the Chinese Government. With this arrangement there would be no temptation to smuggling, and the territory would derive a revenue from customs duties which would not be onerous, as there would be no "aqueeze."

15. Putting the customs duties aside, except that on wine and spirits, it may be assumed that a revenue of £6,000 a year is derivable from the territories.

This should be sufficient to pay for the staff at first required, with a small balance over for necessary works.

The sale of mining rights, increased trade, and sale of reclaimed land, ought eventually to provide some more funds.

16. The most immediate requirement is an Order in Council proclaiming the territory as British, and appointing the Governor.

The next is to provide some money for immediate requirements. The only way appears to be to let the territory borrow a small amount, say £2,000 or £3,000, to be repaid when it gets a revenue.

Then the process of raising a revenue should be considered on the spot, with the aid of any competent adviser who may be procurable.

It will probably be necessary to appoint the judge, the secretary and treasurer and the colonial engineer at an early date The two latter offices might be filled up locally from among the officers now there, thus saving expense for a time as travelling expenses, and quarters would not be required.

The Cantonment Magistrate for the island should be appointed at once, as asked for by the Commissioner.

The further details of organization must be worked out locally. Owing to the great distance from England considerable authority must be given to the Governor, subject to his acts being confirmed by the Home Government.

J. F. LEWIS,

19

Sir C. MACDONALD to the TSUNG-LI YAMEN.

MM. LES MINISTRES,

Peking, December 18, 1899. I HAVE the honour to inform your Highness and your Excellencies that Her Majesty's Government have now appointed Colonel Dorward, R.E., to administer the leased territory of Wei-hai Wei.

Colonel Dorward will have full exercise of the powers of jurisdiction ceded by the Chinese Government in the convention signed on the 1st July, 1898. At his request I bave deputed a Consular officer conversant with the Chinese language and customs to act as his interpreter and assistant.

With regard to international business between the leased territory of Wei-hai Wei and the Chinese Province of Shantung, Colonel Dorward proposes to correspond direct with the Governor of Shantung.

approve the suggestion; the course proposed will save needless correspondence through this Legation and the Tsung-li Yamên. It will only be necessary in cases in which the Commissioner and the Governor of Shantung cannot come to an agreement by direct correspondence to refer the matter to Peking.

I would, therefore, ask your Highness and your Excellencies to direct the Governor of Shantung to adopt the course proposed by Colonel Dorward.

I avail, &c.,

8931,

No. 20.

CLAUDE M. MACDONALD.

9th March, 1900.

8727.

No. 19.

Colonel.

Bir C. Macdonald, No. 350, Dec. 22.

SIB,

FOREIGN OFFICE to COLONIAL OFFICE.

(Received March 19, 1900.)

Foreign Office, March 17, 1900.

I AM directed by the Secretary of State for Foreign Affairs to transmit to you, to be laid before the Secretary of State for the Colonies, the accompanying copies of a despatch, as marked in the margin, respecting the question of direct cominunication between the British and Chinese authorities of Wei-hai-Wei and Shantung respectively,

SIR,

WAR OFFICE to COLONIAL OFFICE.

(Received March 20, 1900.)

[Answered by No. 29.]

War Office, London, S.W., 17th March, 1900. WITH reference to your letter of the 7th ultimo and subsequent correspondence, I am directed by the Secretary of State for War to forward to you a copy of a communi- cation which has been received from Colonel Dorward, submitting proposals for the civil administration of the leased territory of Wei-hai Wei.

I have, &c.,

G. FLEETWOOD WILSON.

Enclosure in No. 20.

(No. 350.) MY LORD,

Enclosure in No. 19.

I am, &c.,

"FRANCIS BERTIE.

Sir C. MACDONALD to the Marquess of Salisbury, (Received February 19, 1900.)

Peking, December 22, 1899. WITH reference to the question alluded to in the despatch from this Legation, No. 294, of the 3rd October last, of direct communication between the British Com- missioner of Wei-hai Wei and the Governor of Shantung on matters arising in connection with the leased territory and the Province of Shantung, I have the honour to state that, in compliance with Colonel Dorward's request, I addressed to the Tsung-li Yamên on the 18th December a note advocating this course.

I have the honour to inclose copy of this note. On the 21st instant I received the Yamên's reply, to the effect that they were writing to the Governor of Shantung in the sense desired.

I have, &c..

CLAUDE M. Macdonald.

SIR,

;

CIVIL ADMINISTRATION OF THE LEASED TERRITORY ; SUBMITS PROPOSALS for.

Wei-hai Wei, 7th January, 1900.

I HAVE now the honour to submit my proposals for the civil administration of the British leased territory of Wei-hai Wei.

Mr. S. Barton, of Her Majesty's Consular Service in China, reported his arrival for duty here on the 14th ultimo, and has been appointed a District Officer and Magistrate to reside at Matcu on the mainland. His principal duty, in addition to magisterial work, will be the collection of the land and salt taxes.

He has been placed in charge of the whole territory with the exception of a strip of land about four miles long in the neighbourhood of the Chinese regiment, which will remain under the control of the officer commanding that regiment, assisted by his chief interpreter, Mr. Schaller; in addition to the magisterial work of the strip, the latter officers collect taxes on junks, timber, etc., and wharfage dues on the old Chinese lines.

It is not proposed to levy any taxes other than those which the inhabitants have been accustomed to pay to Chinese officials.

When the Chinese regiment of infantry and battery of artillery have been raised, Mr. Schaller's services will become more widely available for civil government work.

It is not proposed to establish any civil police force on the mainland, as it is considered that order in the territory can be more efficiently maintained through the Chinese regiment.

• No. 13.

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PUBLIC RECORD OFFICE

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PUBLIC RECORD OFFICE, LONDON

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