2
and bis objections to anything that savours of official interference will hardly be set aside at the bidding of the Viceroy in favour of the Bureau of Commerce. Beside which, trade in Kwangtung certainly needs no other stimulant than that to be derived from amendment of the methods of native officialdom; the trading community distinctly not at fault.
As to the working of the Bureau itself, it would be premature to say anything while it is still passing through its initial stages. At the same time it seems highly probable that it will be neither much better nor much worse than other Chinese institutions of a kindred nature, which is as much as to say that it will not accomplish anything very startling in the way of commercial reform, and that the trade of Kwangtung will go on much as it would have done had the Bureau of Commerce never been instituted. In fact it seems not unreasonable to anticipate that at no very distant date the chief direction in which its energies will display themselves will be in the periodical drawing of the salaries and expenses referred to by the Viceroy in his Memorandum.
The River Bunding Scheme.
That part of the river which flows between Canton City on the north and Honam on the south is comparatively narrow; and its narrowness is accentuated by the vast amount of shipping of all kinds that congregates there, and by the presence, right in the centre of the stream, of some rocks, which are no slight hindrance to navigation. For a long time past this narrow and inconveniently-crowded stream has been gradually narrowed still further by perpetual encroachments on the north bank, such as the building of jetties and landing-stages, and dumping of refuse, and similar practices. In fact, so continual and so marked was the encroachment year by year, that the difficulties of navigation on this branch of the river were increasing at an alarming rate, and showed every sign of increasing in times to come. The present Viceroy, therefore, elaborated a scheme for bunding the whole of the north frontage from the Shameen, along past the city on to the eastern extremity of the suburbs; and no further encroachments of any kind are to be tolerated beyond the line of this bund.
This scheme for preserving the present width of the river is undoubtedly an excellent one, but it is considerably complicated by the fact that a large proportion of the frontage proposed to be thus bunded is in the hands of foreigners. Messrs. Butler, Field and Swire, Messrs. Shewan, Tomes, and Co., and the Hong Kong, Canton, and Macao Steam-boat Company are among those concerned, and these firms, naturally enough, desire to safeguard their interests before they consent to have their areas bunded in by the Chinese authorities. A considerable stretch of Chinese-owned land has already been bunded in; in addition to which negotiations are proceeding intermittently between the Bunding Commissioners and the foreign land-owners, and it is hoped that in due course a modus vivendi may be arrived at. At present, however, pending the conclusion of some satisfactory arrangement, the work is more or less at a standstill.
Among the chief points raised by the foreign owners of property are the obvious ones of compensation for any of their land which, under the provisions of the scheme, may have to be removed, and of prior rights to any land that may be reclaimed in front of their present lots. An additional point specially raised by the Steam-boat Company is that the work shall be under the superintendence of a foreign expert. They claim that this is necessary in order to insure that the bund shall be constructed in accordance with technical principles so as to obviate any further silting-up of the river, thereby preventing their steamers from lying alongside the wharves, as they do at present.
(This Document is the Property of His Britannic Majesty's Government.)
CHINA TRADE,
CONFIDENTIAL.
C
35211 [September 23. 1904
They
SECTION 3.10 04
No. 1.
The Marquess of Lansdowne to Chang Ta-Jên.
Sir,
Foreign Office, September 23, 1904. HIS Majesty's Government have had under their careful consideration the note which you did me the honour of addressing to me on the 27th July last, stating that you were instructed by the Wai-wu Pu to suggest an exchange of views on the subject of the taxation of opium in China.
You point out that, at the time when the Additional Article of the Chefoo Convention came into force, the import duty of 30 taels and the li-kin duty, in the form of a surtax, of 80 taels, making together 110 taels per chest, were equivalent to 273 per cent. of the value of the opium, but that now, owing to the depreciation of silver and the enhanced tael value of the drug, they amount to not more than 132 per cent, and you suggest, in order that the revenue may not suffer in consequence, that the duties on foreign opium should be raised to 220 Haikwan taels per chest.
I observe, however, that in making this proposal you do not allude to the competition to which foreign opium is exposed from the native drug, which is much more lightly taxed.
It has frequently been represented to the Chinese Government, in connection with the attempts of the Provincial Authorities to levy further dues on imported opium, that until equality of taxation is established for the home product and the imported article, the Chefoo Convention prohibits increased taxation of the latter. The same considerations prevent the acceptance of your suggestion that the Chefoo Convention should be amended in the direction of increasing the duties leviable thereunder, while nothing is proposed with regard to bringing native opium under equal taxation. Not only would this be unfair to the Indian producer, but it might also be injurious to the revenues of the Chinese Government if native opium were thereby assisted to supplant Indian opium.
The Chinese Government are, of course, at liberty to terminate the arrangements established by the Additional Article to the Chefoo Convention, in which case the import duty of 30 taels, as fixed in 1858, in connection with the Treaty of Tien-tsin, would alone remain for collection at the ports. There might then be a question of revising the rate with reference to any change which might be found to have occurred in the price of opium. It is understood, however, that the Chinese Government do not intend to withdraw from the Convention, but desire to continue the arrangements by which li-kin, in the form of a surtax, is collected along with the import duty at the ports. As the present surtax of 80 taels is much in excess of any li-kin which the Provincial Authorities are able to collect on home-grown opium, the Convention, though termed "unremitting" in your note, is not without solid advantages to the Chinese Government.
His Majesty's Government cannot admit that there is any relation between the rates of opium duty and the general import duties which were revised in 1901. The former have always been calculated on a special and specific basis, whereas the general tariff introduced shortly after the conclusion of that Treaty was framed on a per cent, ad valorem basis, and its revision in 1901 was the outcome of an agreement to revise the duties so as to make them yield an effective 5 per cent. ad valorem on the basis of the lower value of silver. It may, however, be remarked, in reply to an observation in your note, that if the surtax were fixed on the same principle as that adopted in the Treaty negotiated by Sir J. Mackay for the conversion of li-kin on other dutiable commodities, it would be limited to one and a-half times the duty proper. The present surtax on opium is actually two and two-thirds times the duty.
His Majesty's Government presume that these considerations were not overlooked when opium was omitted from the scheme sanctioned by the Peking Protocol of the 7th September, 1901, for making the general tariff an effective 5 per cent.
In conformity with this omission, section 4 of Article VIII of the Mackay Treaty provides that "Foreign opium duty and present li-kin--which latter will now become a surtax in lieu of li-kin--shall remain as provided for by existing Treaties."
12156 -3]
1
2
and bis objections to anything that savours of official interference will hardly be he aside at the bidding of the Viceroy in favour of the Bureau of Commerce. Beside which, trade in Kwangtung certainly needs no other stimulant than that to be derita from amendment of the methods of native officialdon; the trading community distinctly not at fault.
As to the working of the Bureau itself, it would be premature to say anythi while it is still passing through its initial stages. At the same time it seems hight probable that it will be neither much better nor much worse than other Chine institutions of a kindred nature, which is as much as to say that it will not accomplie anything very startling in the way of commercial reform, and that the trades Kwangtung will go on much as it would have done had the Bureau of Commer never been instituted. In fact it seems not unreasonable to anticipate that at no ve distant date the chief direction in which its energies will display themselves will in the periodical drawing of the salaries and expenses referred to by the Viceroy his Memorandum.
The River Bunding Scheme.
That part of the river which flows between Canton City on the north and Ho on the south is comparatively narrow; and its narrowness is accentuated by the v amount of shipping of all kinds that congregates there, and by the presenco, righti the centre of the stream, of some rocks, which are no slight hindrance to navigatina For a long time past this narrow and inconveniently-crowded stream has been gradul narrowed still further by perpetual encroachments on the north bank, such as t building of jetties and landing-stages, and dumping of refuse, and similar practices In fact, so continual and so marked was the encroachment year by year, that th difficulties of navigation on this branch of the river were increasing at an alarmin rate, and showed every sign of increasing in times to come. The present Viceroy therefore elaborated a scheme for bunding the whole of the north frontage from tele Shameen, along past the city on to the eastern extremity of the suburbs; and i further encroachments of any kind are to be tolerated beyond the line of this bund
This scheme for preserving the present width of the river is undoubtedly a excellent one, but it is considerably complicated by the fact that a large proportion o the frontage proposed to be thus bunded is in the hands of foreigners. Messrs. Butle field and Swire, Messrs. Shewan, Tomes, and Co., and the Hong Kong, Canton, a Macao Steam-boat Company are among those concerned, and these firms, natuali enough, desire to safeguard their interests before they consent to have their an bunded in by the Chinese authorities. A considerable stretch of Chinese-owned lan has already been bunded in; in addition to which negotiations are proceeding inter mittently between the Bunding Commissioners and the foreign land-owners, and it i hoped that in due course a modus vivendi may be arrived at. At present, however pending the conclusion of some satisfactory arrangement, the work is more or less standstill.
Among the chief points raised by the foreign owners of property are the obvi ones of compensation for any of their land which, under the provisions of the schet may have to be removed, and of prior rights to any land that may be reclaime in front of their present lots. An additional point specially raised by the Steam-ba Company is that the work shall be under the superintendence of a foreign exper They claim that this is necessary in order to insure that the bund shall be constructe in accordance with technical principles so as to obviate any further silting-up of river, thereby preventing their steamers from lying alongside the wharvys, as they at present.
(This Document is the Property of His Britannic Majesty's Government.]
CHINA TRADE,
CONFIDENTIAL.
C
35211 [September 23. 550
They
SECTION 3.10 04
No. 1.
The Marquess of Lansdowne to Chang Ta-Jến.
Sir,
Foreign Office, September 23, 1904. HIS Majesty's Government have had under their careful consideration the note which you did me the honour of addressing to me on the 27th July last, stating that you were instructed by the Wai-wu Pu to suggest an exchange of views on the subject of the taxation of opium in China.
You point out that, at the time when the Additional Article of the Chefoo Convention came into force, the import duty of 30 taels and the li-kin duty, in the form of a surtax, of 80 taels, making together 110 taels per chest, were equivalent to 273 per cent. of the value of the opium, but that now, owing to the depreciation of silver and the enhanced tael value of the drug, they amount to un
more than 132 per cent, and you suggest, in order that the revenue may not suffer in consequence, that the duties on foreign opium should be raised to 220 Haikwan taels per chest.
I observe, however, that in making this proposal you do not allude to the competition to which foreign opium is exposed from the native drug, which is much more lightly taxed.
It has frequently been represented to the Chinese Government, in connection with the attempts of the Provincial Authorities to levy further ducs on imported opium, that until equality of taxation is established for the home product and the imported article, the Chefoo Convention prohibits increased taxation of the latter. The same considerations prevent the acceptance of your suggestion that the Chefoo Convention should be amended in the direction of increasing the duties leviable thereunder, while nothing is proposed with regard to bringing native opium ander equal taxation. Not only would this be unfair to the Indian producer, but it might also be injurious to the revenues of the Chinese Government if native opium were thereby assisted to supplant Indian opium.
The Chinese Government are, of course, at liberty to terminate the arrangements established by the additional Article to the Chefoo Convention, in which case the import duty of 30 taels, as fixed in 1858, in connection with the Treaty of Tien-tsin, would alone remain for collection at the ports. There might then be a question of revising the rate with reference to any change which might be found to have occurred in the price of opium. It is understood, however, that the Chinese Government do not intend to withdraw from the Convention, but desire to continue the arrangements by which li-kin, in the form of a surtax, is collected along with the import duty at the ports. As the present surtax of 80 taels is much in excess of any li-kin which the Provincial Authorities are able to collect on home-grown opium, the Convention, though termed "unyielding" in your note, is not without solid advantages to the Chinese Government.
His Majesty's Government cannot admit that there is any relation between the rates of opium duty and the general import duties which were revised in 1901. The former have always been calculated on a special and specific basis, whereas the general tariff introduced shortly after the conclusion of that Treaty was framed on a per cent, ad valorem basis, and its revision in 1901 was the outcome of an agreement to revise the duties so as to make them yield an effective 5 per cent. ad valorem on the basis of the lower value of silver. It may however be remarked, in reply to au observation in your note, that if the surtax were fixed on the same principle as that adopted in the Treaty negotiated by Sir J. Mackay for the conversion of li-kin on other dutiable commodities, it would be limited to one and a-half times the duty proper. The present surtax on opium is actually two and two-thirds times the duty.
His Majesty's Government presume that these considerations were not overlooked when opium was omitted from the scheme sanctioned by the Peking Protocol of the 7th September, 1901, for making the general tariff an effective 5 per cent.
In conformity with this omission, section 4 of Article VIII of the Mackay Treaty provides that" Foreign opium duty and present li-kin--which latter will now become a surtax in lieu of l-kin-shall remain as provided for by existing Treaties."
12156 -3]
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