CO129-326 - Foreign Office - 1904 — Page 402

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The Committee are given to understand that your Excellency has personally taken considerable interest in the projected railway, and in this belief are emboldened to address you on the subject.

The reasons for the construction of this railway are so well understood that it would appear to be almost superfluous to recapitulate them, but we would especially urge upon your Excellency the fact that, while it is clearly to the advantage of British trade generally that Hong Kong should be in direct railway connection with the main trunk lines of China, a very serious, and probably irreparable, blow will be dealt to the welfare of this Colony were Canton first connected by rail with the sea at any other point than through Hong Kong.

There are, we consider, several places outside British territory at which a terminus could be established, and we have only too good reason to fear that some of England's numerous commercial rivals may not be disinclined to use their influence in striking blow at our prosperity.

Unfortunately the Committee have not before them the text of the Agreement made with the Imperial Chinese Government for the construction of a railway from Chinese Kowloon (as it was then) to Canton, and are in some doubt, therefore, as to the exact terms of this Agreement. We understand, however, that there are certain limitations imposed upon the concessionnaires, and that unless these are complied with the Concession can be cancelled.

The Committee give all credit to the endeavours made by the concessionnaires to raise the necessary funds required for the construction of the line, which, we understand, are estimated at 1,500,000l., and are prepared to believe that the difficulties in the way have been of such a nature as to preclude the possibility of the necessary sum being obtained on the home market.

Under these circumstances we would most strongly urge that representations be made to the Foreign Office with a view to securing the guarantee of the Imperial Government on the capital required, and trust that in view of the importance to British trade in China, which the construction of the railway implies, your Excellency will find it possible to indorse our request and submit the matter for the consideration of His Majesty's Government.

I would add that, with regard to that section of the line which lies inside British territory, the Committee are addressing his Excellency the Officer Administering the Government, suggesting that a similar guarantee should be given by the Colony for the interest required on the British section of the line, or that the railway should be con- structed by the Colony,

It is estimated that the line through Hong Kong territory will cost in round figures about 500,000%., 1,000,000l. being required to complete the line to Canton.

So far as it is possible to obtain statistics of the trade of the district through which the projected line will pass, it would appear that a large trade in produce and manu- factured articles even now exists, while judging from the effects of railway enterprises already carried out in China and other parts of Eastern Asia, we believe we are justified in stating that once the line is in working order an enormous increase will take place in the trade and in the passenger traffic, with the result that the line should prove a thoroughly sound business undertaking, and the risk to the guarantors would be practically nil,

If it is possible to obtain such Government guarantee, we believe that the present concessionnaires should have no difficulty in promptly completing their negotiations and commencing the construction of the line at an early date. The Committee are of opinion that the concessionnaires should be given twelve months in which to actually start work on the railway; and if at the termination of this period a start has not been made, they consider that in the interest of this Colony and of British trade generally, opportunity should then be afforded for other negotiations to be put in train.

In conclusion, I trust I may be permitted to express the hope that your Excel- lency's influence will be employed in furthering the early construction of the Canton- Kowloon Railway, upon which enterprise the continued prosperity of this Colony and of British trade in South China so vitally depends.

I have, &c. (Signed) E. A. HEWETT,

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Inclosure 2 in No. 1.

Minutes of the Yearly General Meeting of the Hong Kong General Chamber of Commerce, held on Wednesday, April 27, 1904, at 3×30 P.M., for the purpose of receiving the Report of the Committee and passing the Secretary's Accounts for the Year ending December 31, 1903,

(Extract.)

I HAVE reserved to the last what I think you will all agree is to Hong Kong the most important question, as far as this Colony is concerned, that has arisen during the past few years, although it has not as yet been formally dealt with by this Chamber. I refer to the proposed Canton-Kowloon Railway. (Applause.) Throughout the whole of China we see new railways being projected, and in some cases actually completed, The race is to mainly, I regret to say, by the enterprise of those other than British.

says:

the swift, and we cannot grudge the well-earned success of our commercial rivals who, under other flags, press forward where our British investor apparently fears to tread. The British investor, I am informed on high authority, does not care to put his money into railways in China, and in view of the aid that other Governments render their nationals, while our Foreign Office refuses to give us equal support, it is not, perhaps. surprising that British concessions for railways in China languish while we see foreign capital freely spent in developing foreign concessions. The Under-Secretary of State for Foreign Affairs is reported at a recent gathering in London to have made a statement to the following effect. Speaking on behalf of the Foreign Office, he We are alive to the importance of railway development in civilizing a country and in promoting its commercial development .

but in China we had not ourselves administrative responsibility, and the work must be done by the foresight motives and self-interest of private capitalists." This, I think, fully explains, and in a Whether or not the Under- manner justifies, the attitude of the British investor, Secretary of State has been correctly reported I am not in a position to say, but even though he may not have made use of the words above quoted, the policy of the Foreign Office, as understood by us, is here clearly defined. The time has now arrived, however, when an exception should be made to this policy. As I have already stated, the prosperity of this Colony depends upon its maintaining its position as a distributing centre for the trade of South China. This being the case, it is imperative that the first railway line counceting Canton with the sea should be the Canton-Kowloon Railway. If funds for this line, estimated at 1,500,0001, cannot be raised by other means, then our Foreign and Colonial Offices should join hands. This Colony should be allowed to guarantee for a term of years the interest on the capital required for the section of the line across the new territory, or, if necessary, should construct and own the line, while the Home Governinent should for once, in the interests of British trade in China, break through its traditions, and guarantee the interest on the cost of the section outside the Colony. (Applause.)

The distance is somewhere about 120 miles, of which one-fifth would be in Hong Kong territory, and the cost of this section of the line would be about one-third of the whole. The importance of this question, both from a local and Imperial point of view, is so great that I make no apology for dealing at such length with the

matter,

Chairman.

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