676
more favoured Chinese rivals, who, by means of specially constructed lighters, towed by steam-launches, secure the great bulk of the cargo, and, until recently, of the passengers. The system adopted at the Treaty ports is for these lighters and their cargoes to come under the li-kin administration, and the steam-launch, which is merely the means of propulsion, and carries no cargo, comes under the Imperial Maritime Customs, a dual system of control, which gives the advantage of the quickness of steam transit and an elastic tariff for the payment of duty on the cargo carried in the lighters. Nor is it so much the fact that the li-kin collected on this cargo is less than the one and a-half duty which would be levied by the Imperial Maritime Customs if it were carried in our steamers, as it is that, if so carried, li-kin taxes before shipment and after discharge would be payable in addition to the customs duty and a-half. The foregoing are only too well known, and have been frequently commented on, notably by Her Britannic Majesty's Consul in his Trade Report for 1897; but if further proof be needed, it is abundantly supplied by the fact that the only domestic trade of which we secure the carriage is a few piculs of goods between Samshui and Wuchow, whereas the merchants refuse to ship the same goods by our vessels between Wuchow and Canton, even although the freight charged be the same in both cases. That is to say, taxation and cost of transport being equal for both distances, they will ship by our vessels over the shorter one, but steadily refuse to do so over the longer one. The explanation of this is simple. At Samshui, by vigorous protests made at the opening of the port, the native goods carried in foreign vessels are, to a certain extent, exempt from li-kin taxes before shipment and after discharge, while at Canton the reverse is the case, and as the bulk of the domestic trade of the West River districts is destined for, or comes from, Canton, as being the great centre or mart of trade, the natural result of this differential taxation is that our Chinese rivals secure the carriage of the whole of it. Nor does the evil stop at this, for knowing that our earnings must be made out of the carriage of foreign goods—into which, as far as the carrying in steamers between Treaty ports goes, the question of taxation does not enter—they can either conform to our rates of freight and compete against us, or by lowering them slightly, get the monopoly of the carriage of these as they do of the domestic trade.
Although the subject of this representation is the disadvantages under which we suffer as British Shipping Companies engaged in the carrying trade of China, we will, for the moment, waive this question and look at it from the broader standpoint of trade in general. From the foregoing it might be argued that, although we as individual concerns suffer, the great circulation of goods is facilitated by steam traffic; were such the case we might well find compensation for our losses in the general prosperity that would result; but it is only to the privileged few that permission is given to run this class of vessels, and any attempt to encroach on the monopoly thus secured, either on the part of Chinese or foreign steamers, is rendered nugatory by differential duties in the manner we have shown.
Again, with the passenger traffic, the Chinese vessels had the option of using all routes connecting Canton with the West River, whereas we were confined to one only, laid down by the Customs, entailing an increase in the distance traversed of some 30 miles. They were also privileged to stop at any and all places en route for the embarking and disembarking of passengers or cargo, while we were confined to the four ports of call (see Canton Commissioner's Trade Report, 1897, 4 and 7).
The question of opening the shorter routes to foreign vessels was made the subject of representation to Her Majesty's Consul at Canton, but so scandalous had the disabilities under which we laboured become, and so heavy the losses incurred in running steamers practically empty, that the question of withdrawing them altogether from the trade was being seriously considered when the throwing open of the inland waters gave the Imperial Maritime Customs the chance, of which they gladly availed themselves, of attempting to place us on terms of equality with our opponents. This equality in respect to the carriage of passengers we now enjoy, and we were not without hopes that by clause of the Supplementary Rules under Inland Steam Navigation Regulations, goods carried in native boats towed by steamers would come under the same rules for duty payment as goods carried in our vessels, but up to date there is no sign of any attempt being made to bring this about, and, moreover, by the Inspector-General's decision it would appear that, instead of a further step being taken to secure equality of taxation for all goods, no matter how carried, a retrograde movement is contemplated which will place us in the disastrous position we occupied at the opening of the trade.
If this decision hold good the utter impossibility of any steamer securing the carriage of goods under inland navigation rules can perhaps be best shown by an illustration. Certain foreign goods are imported into Samshui where they pay import duty and transit dues, being destined for some place (not a "port of call") situated between Samshui and Canton. We, as British Shipping Companies, compete with the Chinese Companies referred to throughout this Memorandum, for the carriage of them. If we wish to secure them we must provide a special steamer to run from Samshui to the place in question, although our inter-Treaty port steamers pass it en route every day, and are, for the reasons already given, practically empty. The Chinese Companies not being under any such restrictions will be at liberty to carry them in their lighters, which are also free to engage in inter-Treaty port trade. We have endeavoured to show that as long as the tax of one duty and a-half on cargo carried in steamers between two Treaty ports is enforced, while it is permitted to other craft coming under the native administration to compound for a less sum, the domestic trade will surely be diverted to vessels so privileged, and that the monopoly so gained can be, and will be used to secure the carriage of foreign goods from one port to the other, or to any points lying between them. So by an analogous reasoning it can be shown that in the event of our attempting to start any steamers under inland navigation rules to run beyond the precincts of the last Treaty port, so surely will this differential treatment be extended to the goods carried in them.
We are only too well aware that nothing short of the abolition of this dual system of custom-houses in vogue in China will provide an effectual remedy for the evils we complain of. We are not so sanguine as to entertain the belief that a workable tariff will ever be published by the provincial officials, but by insisting on the measures suggested in our covering letter the hand of the Chinese Government will be so forced that it must ultimately result in the Imperial Maritime Customs being called upon to undertake the compilation of a General Tariff applicable to the whole of the internal taxation of China, the maximum basis of which might be the 7½ per cent. (duty and a-half) now charged on goods steamer-borne between two Treaty ports, and which it is evident that the Inspector-General's ruling is intended to protect.
(Signed) JARDINE, MATHESON, AND Co., General Managers, Indo-China Steam Navigation Company (Limited). BUTTERFIELD AND SWIRE, Agents, China Navigation Company (Limited), THO. ARNOLD, Secretary, Hong Kong, Canton, and Macao Steam-boat Company (Limited).
Hong Kong, March 28, 1899.
Inclosure 7 in No. 1.
Consul Mansfield to Mr. Bax-Ironside.
(No. 10.) Sir,
Canton, April 11, 1899. I HAVE the honour to inclose a joint communication addressed to me under flying seal by Messrs. Jardine, Matheson, and Co., Messrs. Butterfield and Swire, and the Secretary of the Hong Kong, Canton, and Macao Steam-boat Company (Limited), on the subject of the opening of the inland waters of China to steam navigation. The writers requested me to add my own comments, which I proceed to do briefly.
They ask for
"1. The prompt publication of the Rules and Regulations promised in Rule 7 of the Inland Regulations and clause 8 of the Supplementary Rules, and also the appointment of the Provincial Officer referred to in clause 9 of the latter."
I have been informed by the Commissioner of Customs that these Rules and Regulations, with a list of li-kin stations, li-kin tariff, list of articles subject to tso-li and rates charged, and list of articles subject to ching-fei ("battery tax"), and rate charged, attached, have already been drafted, and will very shortly be published. A Provincial Officer has also been nominated, who will have a floating office on the Honam shore opposite the custom-house.
(Confidential.)
A draft of the Regulations has been shown me privately by the Commissioner, and I have, at his request, made my comments therein. The Regulations are not satisfactory, as he admits, and will require much revision, but it would be premature to discuss them at present.
(2095 a-1)
5
676
more favoured Chinese rivals, who, by means of specially constructed lighters, towed by steam-launches, secure the great bulk of the cargo, and, until recently, of the passengers. The system adopted at the Treaty ports is for these lighters and their cargoes to come under the li-kin administration, and the steam-launch, which is merely the means of propulsion, and carries no cargo, comes under the Imperial Maritime Customs, a dual system of control, which gives the advantage of the quickness of steam transit and an elastic tariff for the payment of duty on the cargo carried in the lighters. Nor is it so much the fact that the i-kin collected on this cargo is less than the one and a-half duty which would be levied by the Imperial Maritime Customs if it were carried in our steamers, as it is that, if so carried, li-kin taxes before shipment and after discharge would be payable in addition to the customs duty and a-half. The foregoing are only too well known, and have been frequently commented on, notably by Her Britannic Majesty's Consul in his Trade Report for 1897; but if further proof be needed, it is abundantly supplied by the fact that the only domestic trade of which we secure the carriage is a fer piculs of goods between Samshui and Wuchow, whereas the merchants refuse to ship the same goods by our vessels between Wuchow and Canton, even although the freight charged be the same in both cases. That is to say, taxation and cost of transport being equal for both distances, they will ship by our vessels over the shorter one, but steadily refuse to do so over the longer one. The explanation of this is simple. At Samshui, by vigorous protests made at the opening of the port, the native goods carried in foreign vessels are, to a certain extent, exempt from li-kin taxes before ship- ment and after discharge, while at Canton the reverse is the case, and as the bulk of the domestic trade of the West River districts is destined for, or comes from, Canton, as being the great centre or mart of trade, the natural result of this differential taxation is that our Chinese rivals secure the carriage of the whole of it. Nor does the evil stop at this, for knowing that our earnings must be made out of the carriage of foreign goods- into which, as far as the carrying in steamers between Treaty ports goes, the question of taxation does not enter--they can either conform to our rates of freight and compete against us, or by lowering them slightly, get the monopoly of the carriage of these as they do of the domestic trade.
Although the subject of this representation is the disadvantages under which we suffer as British Shipping Companies engaged in the carrying trade of China, we will, for the moment, waive this question and look at it from the broader standpoint of trade in general. From the foregoing it might be argued that, although we as individual concerns suffer, the great circulation of goods is facilitated by steam traffic; were such the case we might well find compensation for our losses in the general prosperity that would result; but it is only to the privileged few that permission is given to run this class of vessels, and any attempt to encroach on the monopoly thus secured, either on the part of Chinese or foreign steamers, is rendered nugatory by differential duties in the manner we have shown.
Again, with the passenger traffic, the Chinese vessels bad the option of using all routes connecting Canton with the West River, whereas we were confined to one only, laid down by the Customs, entailing an increase in the distance traversed of some 30 miles. They were also privileged to stop at any and all places en route for the embarking and disembarking of passengers or cargo, while we were confined to the four ports of call (see Canton Commissioner's Trade Report, 1897, 4 and 7).
The question of opening the shorter routes to foreign vessels was made the subject of representation to Her Majesty's Consul at Canton, but so scandalous had the disabilities under which we laboured become, and so heavy the losses incurred in running steamers practically empty, that the question of withdrawing them altogether from the trade was being seriously considered when the throwing open of the inland waters gave the Imperial Maritime Customs the chance, of which they gladly availed themselves, of attempting to place us on terms of equality with our opponents. This equality in respect to the carriage of passengers we now enjoy, and we were not without hopes that by clause of the Supplementary Rules under Inland Steam Navigation Regulations, goods carried in native boats towed by steamers would come under the same rules for duty payment as goods carried in our vessels, but up to date there is no sign of any attempt being made to bring this about, and, moreover, by the Inspector-General's decision it would appear that, instead of a further step being taken to secure equality of taxation for all goods, no matter how carried, a retrograde movement is contemplated which will place us in the disastrous position we occupied at the opening of the trade.
If this decision hold good the utter impossibility of any steamer securing the carriage of goods under inland navigation rules can perhaps be best shown by an illustration. Certain
5
foreign goods are imported into Samshui where they pay import duty and transit dues, being destined for some place (not a "port of call") situated between Samshui and Canton. We, as British Shipping Companies, compete with the Chinese Companies referred to throughout this Memorandum, for the carriage of them. If we wish to secure them we must provide a special steamer to run from Samshui to the place in question, although our inter-Treaty port steamers pass it en route every day, and are, for the reasons already given, practically empty. The Chinese Companies not being under any such restrictions will be at liberty to carry them in their lighters, which are also free to engage in inter-Treaty port trade. We have endeavoured to show that as long as the tax of one duty and a-half on cargo carried in steamers between two Treaty ports is enforced, while it is permitted to other craft coming under the native administration to compound for a less sum, the domestic trade will surely be diverted to vessels so privileged, and that the monopoly so gained can be, and will be used to secure the carriage of foreign goods from one port to the other, or to any points lying between them. So by an analogous reasoning it can be shown that in the event of our attempting to start any steamers under inland navigation rules to run beyond the precincts of the last Treaty port, so surely will this differential treatment be extended to the goods carried in them.
We are only too well aware that nothing short of the abolition of this dual system of custom-houses in vogue in China will provide an effectual remedy for the evils we complain of. We are not so sanguine as to entertain the belief that a workable tariff will ever be published by the provincial officials, but by insisting on the measures suggested in our covering letter the hand of the Chinese Government will be so forced that it must ultimately result in the Imperial Maritime Customs being called upon to undertake the compilation of a General Tariff applicable to the whole of the internal taxation of China, the maximum basis of which might be the 73 per cent. (duty and a-half) now charged on goods steamer-borne between two Treaty ports, and which it is evident that the Inspector-General's ruling is intended to protect,
(Signed) JARDINE, MATHESON, AND Co., General Managers,
Indo-China Steam Navigation Company (Limited). BUTTERFIELD AND SWIRE, Agents, China Navigation
Company (Limited),
THO. ARNOLD, Secretary, Hong Kong, Canton, and
Macao -Steam-boat Company (Limited).
Hong Kong, March 28, 1899.
Inclosure 7 in No. 1.
Consul Mansfield to Mr. Bax-Ironside.
(No. 10.) Sir,
Canton, April 11, 1899. I HAVE the honour to inclose a joint communication addressed to me under flying seal by Messrs. Jardine, Matheson, and Co., Messrs. Butterfield and Swire, and the Secretary of the Hong Kong, Canton, and Macao Steam-boat Company (Limited), on the subject of the opening of the inland waters of China to steam navigation. The writers requested me to add my own comments, which I proceed to do briefly.
They ask for
"1. The prompt publication of the Rules and Regulations promised in Rule 7 of the Inland Regulations and clause S of the Supplementary Rules, and also the appoint- ment of the Provincial Officer referred to in clause 9 of the latter."
I have been informed by the Commissioner of Customs that these Rules and Regu lations, with a list of li-kin stations, li-kin tariff, list of articles subject to tso-li and rates charged, and list of articles subject to ching-fei ("battery tax "), and rate charged, attached, have already been drafted, and will very shortly be published. A Provincial Officer has also been nominated, who will have a floating office on the Honam shore opposite the custom-house.
(Confidential.)
A draft of the Regulations has been shown me privately by the Commissioner, and I have, at is request, made my comments therein. The Regulations are not satis- factory, as he admits, and will require much revision, but it would be premature to discuss them at present.
(2095 a-1]
C
No comments yet.
Private notes are available after approval.