CO129-326 - Foreign Office - 1904 — Page 616

On the 19th August I took an opportunity of reminding my Japanese colleague that two years ago I had informed him of the view of His Majesty's Government that the proposed camphor monopoly was contrary to the Treaty engagements of China, and that I was instructed to protest to the Chinese Government. British merchants had naturally continued to purchase camphor in the interior of the province and to have it brought down under transit-pass.

It was, however, seized, sometimes by Chinese officials, sometimes by Japanese acting under the orders of the Japanese expert engaged by the Fukhien Provincial Government.

His Majesty's Consul had made complaints to the Viceroy, and had claimed compensation on behalf of the British merchants concerned. I had now heard from His Majesty's Consul that the Chinese authorities had cancelled the monopoly and dismissed the Japanese expert; but Mr. Nakamura, the Japanese Consul, had refused to receive the letter of the Chinese authorities announcing this decision, and the Japanese, under the orders of the expert, had come into collision with the porters transporting camphor belonging to British subjects, and revolvers had been drawn on both sides.

Mr. Uchida replied that the Chinese authorities had acted in a very high-handed manner, and the Japanese Consul had rightly returned the letter addressed to him conveying their intention of cancelling the agreement with the expert. The Foreign Board had spoken to him on the subject, and he was disposed to arrange matters in an amicable manner. He had, therefore, instructed the Japanese Consul at Amoy to proceed to Foochow in order to confer with the authorities.

As regards the nature of the agreement between the Fukhien provincial authorities and the Japanese expert, his Government had not accepted the view that it was contrary to the Treaties. Whatever had been done by Japanese subjects in the way of seizing camphor had been done under the orders of the Chinese authorities, and they had not acted independently.

I rejoined that the only amicable settlement that appeared admissible was that the Fukhien Government should repay to the expert whatever was due to him, and that the cancellation of the monopoly should be upheld. I had recently learnt that the United States' Minister had protested to the Chinese Government against the illegality of the monopoly as soon as he heard of its being proposed, but as the United States' citizens were not engaged in the trade, he had not had occasion to make any further representations.

Of course, I quite understood that the Formosan authorities were anxious to keep up the price of their own camphor, but that did not justify the creation of a monopoly of Chinese camphor in their behalf.

Mr. Uchida smilingly alluded to the alliance between Great Britain and Japan, but I answered that it was only for political purposes, and it could not be expected that merchants should sacrifice their commercial interests to further the political aims of their Governments.

I think it can be hardly denied that the action of Japan in this matter, if it became known to the British public, could not but have a prejudicial effect. My Japanese colleague is, of course, acting under the instructions of his Government, and any suggestions made to him by me are not likely to have much weight so long as they continue to maintain what appears to be their present attitude.

(No. 21.) Sir,

I have, &c. (Signed)

ERNEST SATOW.

Inclosure 1 in No. 1.

Consul Brady to Sir E. Satow.

Foochow, July 28, 1901.

It affords me much satisfaction to be able to report that the local authorities have at last abandoned their hostile attitude towards the camphor trade, the monopoly in which they have done everything in their power to maintain for some considerable time past.

Under instructions from the Viceroy the Government Camphor Bureau has now been abolished, together with all the sub-offices in the interior, and a notification has been issued that henceforward native and foreign merchants alike are to be at liberty to engage in the trade without restriction or interference of any sort.

This decision was communicated to me by the Foreign Board, copy of whose despatch I have the honour to inclose. On the 24th and 26th instant, I had a visit from Yang Ta-jén, the President of the Board, who confirmed it.

Yang Ta-jén informed me that the Japanese Consul here had been notified of the cancelling of the Agreement with the Japanese Syndicate, according to which, as you will remember, they were to control the trade for a period of six years with the possibility of extension for another term on the expiration of that time, but that the Consul had not only refused to accept the notification, but had returned the Board's despatch in which it was conveyed.

The position taken up by Mr. Nakamura, I believe, is that the Syndicate having acquired the concession or monopoly from the late Viceroy as the Representative of the Chinese Government, in return for a sum of 200,000 taels, it is not now competent for the present Viceroy to cancel it before the termination of the term agreed upon. The Chinese authorities, on the other hand, now deny that it was ever contemplated to give the Syndicate a monopoly, and assert the object of the Agreement was simply for the purpose of developing the camphor industry in the province, the Syndicate undertaking to supply experts on the invitation of the Camphor Bureau, to teach the Chinese (who were ignorant) how to prepare camphor according to modern methods, and further that, under the terms of that Agreement, it was competent for the Bureau to dispense with their services any time they wished. The receipt of the sum stated by the Provincial Government is admitted, but it is contended it was merely in the nature of a loan to enable the Bureau to commence operations and that this was understood when the Agreement was signed. The authorities therefore claim the right to dismiss the experts, which they have done, and also to cancel the Agreement on repayment of the sum advanced with interest, which they also profess themselves ready to do.

If this was the whole arrangement it is difficult to see what advantage the Syndicate hoped to derive from it, but I think there is little room for doubting that the ulterior object was the exclusive control of all camphor produced in the province, though Yang Ta-jén emphatically denies that this was so.

Mr. Nakamura maintains that the Syndicate still have the right to send their agents into the interior to seize any camphor found, and while declining to recall them he warns the officials against interfering with them, as they will be held responsible for the consequences; this, as Yang Ta-jén informed me, means, in his opinion, that the Japanese will resist by force any attempt by the local officials to restrain them from carrying out their designs; he considers if any trouble arises the Japanese are quite capable of inflicting injuries on themselves in order to establish a charge against the officials, indeed, he said that the Japanese Consul had hinted that a loss of life would not deter them from insisting upon the due fulfilment of the Agreement. The Viceroy, however, has dismissed all the Japanese hitherto in the employ of the Camphor Bureau, and has given orders that hereafter if any person, under the pretence of being employed by that Office, stops goods in transit, or attempts in any way to interfere with the camphor trade, he is to be at once arrested; thus a serious situation has been created which the Foreign Board admit their inability to grapple with. Yang Ta-jén appealed to me for advice as to how to deal with the difficulty, but the only advice I could give him was to lay the facts before the Wai-wu Pu and let the Ministers arrange the matter with the Japanese Minister; it appears, however, that this has already been done, but without effect.

Yang Ta-jén then said that the question affected foreign merchants of all nationalities, and he would therefore lay it before the Board of Consuls for them to deal with, but I was compelled to tell him that such a request would certainly not be entertained, whereupon he said, in that case, he would notify the Consuls individually that China no longer held herself responsible for any seizures of camphor made by the Japanese, and that they must look to the Japanese Government for redress in the event of the trade being further interfered with. I strongly deprecated even this course, as I explained that the duty of affording protection to foreign merchants exercising their lawful rights in China naturally lay with the local authorities who could not be allowed to shirk it, adding that foreign Consuls could not possibly recognize the Japanese in the matter. Yesterday, however, the accompanying despatch was sent to the Consular Body by the Foreign Board, and, as you will see, it distinctly disclaims all responsibility of the Chinese officials in the event of the Japanese interfering with the transport of camphor belonging to foreign merchants or of their committing any act injurious to the business of such merchants, and giving the Consuls notice that they must look to the Japanese Consul to arrange any cases that may occur.

There is no doubt that the Japanese, rightly or wrongly, are responsible for most, if not all, of the trouble that has occurred in the interior; the Chinese, I believe, have been restrained from taking any action.

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