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foreigner wish to sell goods on his own account direct to the consumer, he does not recei such bonus, and is placed at a corresponding disadvantage.
No comparison can be drawn between such farms and those granted by foreign countries. The latter are avowedly monopolies-the exclusive trade in opium being vested, for instance, in the Hong Kong farmer; but China has by Treaty undertakea never again to grant a pure monopoly to any mercantile Syndicate, and any grant which in the slightest degree infringes such stipulation would seem to be illegal.
Again, is not a tax, the increment of which is merely intended to increase the provincial revenne as a whole, instead of being, as the name is supposed to imply, devcted to the purely local needs of the district where it is levied, an increased import duty ? As Tso-li taxation a matter of fact, a terminal tax, strictly speaking, does not exist in China, is simply a pretext, whereby the provincial authorities seek to recover part of the loss When levied by officials on goods sustained by the Treaty commutation of transit ducs. not under transit pass it is charged at the li-kin station at the town for which the goods are destined, and they may hence be termed transit li-kin, inasmuch as it is one item out of the many which such goods compound by a single payment. On this river quotations of freight are made by native junks at certain rates, which include all li-kin charges. (Note, e.g-Freight from Nanning to Wuchow is 25 m. per picul, and plus li-kin, it. 50 m, but 11, 25 w. by itseli would only in rare instances cover all squeezes.) It is thes impossible to say how much is freight or how much is li-kiu, and, even if the amount of the latter be ascertained, of what items it is composed.
Should the tso-li be levied by a mercantile Syndicate, it is invariably collected at the port of import, as the cost of collecting it all over the province would be too great. Goods under transit pass are hence, theoretically, exempt from this levy, but few Chinese dealers would dare to resist the attempts the Syndicate would subsequently make to recover what it considered its due.
Under these circumstances, seeing that tso-li taxation levied by officials is indistinguish- able from other li-kin charged at the port of arrival, and that levied by merchants it is only collected at the port of import, the only conclusion one can apparently arrive at is that it is: (1) Either that it is not payable by transit-pass goods under any circumstances; or (2) that, if payable when levied officially, transit-pass goods are, by a parity of reasoning, at the same time liable to all other charges made at the Li-kin Office stationed at their point of destination.
(Note-If goods under transit pass having passed the last barrier in the shape of the li-kin station at their point of destination after arrival at the consumer's place of business are called on to pay tso-li, is not that practically equivalent to taking them back to the last barrier to satisfy charges from which their passes protected them ?
And if they can be taken back and made to pay one item, why should they not be made to pay all, or even taken back to a barrier already passed at another town P)
One point in connection with the transit trade is worthy of consideration, and that is the legality of disposing of inward transit pass goods en route to their destination, According to Sir Thomas Wade, Lord Elgin was certainly of opinion that a British merchant, proceeding into the interior with a passport and a cargo under transit pass, would be at liberty to dispose of his goods as advantageously as possible as he went along. Sir Robert. Hart has quite recently given expression to the same opinion, and I venture to think that, were it clearly shown to the Chinese Government that this would not in any way involve a loss of revenue or open the door to fraud, it might be possible to obtain their consent to its being done. The permission would certainly be made use of, and might be restricted to foreigners only. It is not unlikely that, during the next year or two, foreign merchants will make journeys into the interior, with the object of discovering trade routes and particulars regarding exports, and it would be of great assistance to them financially were it possible to do a little trading en route. Particulars of every lot sold would, of course, have to be indorsed on the pass by the Li-kia Office concerned, so that there could always be a means of verifying the quantity carried by comparing the number of bales sold, and the number yet remaining in hand, on arrival at any particular station or at the ultimate destination.
In addition to the imports by every steamer from Hong Kong, boat-loads of foreign goods under transit pass from Canton, pass up the river, it being found cheaper to hire a boat for 45 dollars, which will carry 100 bales of yarn, than to pay 1 dol. 20 c. per bale per steamer.
Large quantities of foreign cloth cut into half-widths, so that they can be more easily manipulated by native tailors, are dyed in the delta and imported. Japanese merchants have recently visited Wuchow bringing with them sample packages of Japanese yaru and cloth, for which they found a ready sale. The latter article is gaining ground
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everywhere in China on account of its cheapness and other qualities, and will doubtless not fail to be appreciated by the natives of this province. Agents of the Russian Oil Syndicate have also been here and propose shortly to establish a depôt for kerosene oil in bulk.
The establishment of rails in Hong Kong to spin yarn and dye piece-goods ought to prove successful, as they will practically monopolize the import trade of South-east China. It is proposed to grow cotton in Borneo for the purpose of supplying the raw material, and, once the initial difficulty of securing skilled labour is overcome, they will bave few other obstacles to contend with. Indigo and the tubes, known as the false gambier, used for dyeing cloths that peculiar brown, so characteristic of the clothing of the lower orders in South China, are produced in Kuangbsi in large quantities. The best quality of the latter comes from Lungehou, and its price here varies from 60 m. to 1 t. 40 ma picul, according to the season of the year. In the event of the import of colonial dyed cottons assuming large proportions, it would be desirable to place them in the import Tariff on the same footing as foreign cottons dyed in China, ie., only charging them i t. 5 m. per 100 catties instead of 1 m. 5 c. a-piece, which, although only half widths, they would have to pay under present conditions.
Jardine, Matheson, and Co.'s mill, it is anticipated, will commence spinning within eighteen months, and Holiday, Wise, and Co. expect ere long to float another Company of the same kind.
The development of the export trade is of necessity a slower process than that of the import trade. Communication with the various centres where goods for export are collected, is slow, and the local brokers have not yet had time to open up-relations with their up-country constituents on the new basis.
Nanning and Pose are the great entrepôts of trade for Yunnan and Kueichon, the former principally for imports and the latter for exports. The agents are almost invariably Cantonese and the banking is done through Fatshan. The modes of conveyance west o Posê, or rather Po-ngai, three days further on, are donkeys, ponies, and occasionally camels, and the exports there collected are hides, aniseed oil, star aniseed, nut galis, Yünuan tin, moxa, and native opium. The staples of export of the Nanning District are grain, sugar, ground-nut oil, ground-nut cake, beaus, and paper. In addition to the above, Wuchow exports indigo, raw silk, cassia, rhea fibre, wood oil, and timber.
Early in July the Governor-General informed the Commissioner of Customs that no outward transit passes were to be granted for timber, oil, bean-cake, and grain. Except
in the case of the latter article, his Excellency will find difficulty in obtaining recognition of his right thus arbitrarily to make restrictions, not sanctioned by Treaty, and I believe the Inspector-General has told Mr. Acheson that he is unable to confirm those instructions.
No test case has as yet arisen, but an application for an outward transit pass to bring down timber for export to Hong Kong is contemplated, and, as I should certainly transmit it to the Chinese authorities, it will be interesting to see what arguments they will bring forward against it. The great difficulty lies of course in measuring the thuber and ascertaining its exact quantity, and a further difficulty would arise when the raft came to be exported. (Vide note at the end of the section on exports.)
I have succeeded in having outward transit passes issued, without the formality of bond, and fifty have been applied for to bring down hides, aniseed oil, star aniseed, sugar, leather, paper, &c., from Nanning and Posê. As little of the produce has so far reached Wuchow, it has been impossible to ascertain if everything has worked smoothly. Had it been necessary to comply with the formalities in force at Canton, those passes could not have been applied for here, as none of the local agents of British firms have authority to sign bonds on behalf of their principals.
It is gratifying to be able to record that a beginning has been made towards utilizing the much-talked-of mineral wealth of these provinces. Just across the Kuangtung border, in the Feng-ch'uan District, there are some coal mines, at which work has been fitfully carried on for many years past. The arrival of steamers and the opening of this port gave an impulse to the industry, and the proprietors lately entered into a contract, unider- taking to supply the two Hong Kong steadiers with 150 tons a month for half a year. The steaming qualities of the coal are very fair, and the price below that of the Hong Kong cost of Japanese coal. Those two steamers thus obtain their whole supply locally, and the Canton steamers endeavoured to a make a similar contract, but the permanent supply of a large quantity cannot at present be guaranteed. The methods of working" are primitive, and the cost of transport from the pit mouth to the West River heavy, as the small boats which have to bring it down return empty. The commencement has how- ever been made, and it is to be hoped the adventure will prove successful.
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