CO129-330 - Public Offices - 1905 — Page 424

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the arrangements come under the general cognizance and supervision of Sir R. Hart and the Imperial Customs,

The reason why such an agreement is necessary is, in the case of points (1) and (2), to get rid of the obligation to pay the heavy "foreign" opium duty, and in the case of point (3), because without such an understanding neither the Government of India or the Chinese merchants who embark capital in the proposed trade will know exactly where they are; and that without it, the whole scheme would be at the mercy of any petty li-kin official in the interior of China. It is by no means an easy matter to get a clear statement from Chinese officials as to what payments on account of taxes in respect of any commodity are really due, nor are such statements, if procured, always to be relied on.

The exact nature of the agreements required would be:-

(1) With the Yunnan authorities and the Tengyueh Customs, that Yünnan opium destined for transport across Burmah via the Tengyueh-Burmah route en route to Canton or any other East Coast port, should pay the Yunnan provincial li-kin for the time being lawfully due and no more or less, as a condition precedent to being accepted The proof of such lawful payment for export viâ Burmah at Tengyueh custom-house, would be the production of li-kin receipts in the form issued by the Yunnan authorities. This is the procedure at Mengtse for opium exported by the Customs there for Touquin.

On production of the li-kin receipts, the Tengyueh Customs would allow the opium to go out, probably on payment of a further customs duty, the amount of which would be prescribed by Sir R. Hart after an agreement had heen come to with the British authorities.

As the opium is produced by Chinese in China, and is destined for consumption by Chinese in China, it is hoped that the Chinese Maritime Customs duty would be levied at a low rate. India need not ask for a high rate, for the competition of the Yunnan drug will not be with India but rather with Szechuan opium. The export duty at Mengtse for opium destined for Tonquin is 20 taels (say, 40 rupees a picul of 1334 lb.). (2.) With the Canton authorities and the Canton Customs (or with the Shanghae Customs and the local provincial authorities, or with the Customs and the appropriate provincial authorities of whatever the port of entry on the East Coast may be), the agreement would be that on arrival of the Yunnan opium, the Imperial Customs should take charge of it, and not release it until consignees had paid to the provincial li-kin or other lawful authorities the proper provincial destination duties, which should be no more or less than those supposed to be levied on Yunnan opium arriving not viâ Burmah but by interior overland routes.

In Yünnan, li-kin is the only inland charge on opium.

The Customs at the port of destination having received proof that the proper provincial dues have been paid on the opium would release it in the same way as is now done with foreign opium, or native opium arriving via the Yang-tsze.

The reason why stress is laid on the payment of provincial li-kin both in Yunnan and at the port of destination, is that it is most essential to the success of the scheme that the Governments of the various provinces concerned should have their sympathies enlisted on behalf of it. I have been in demi-official correspondence with our Consul- General at Canton on the subject, and he has especially insisted on this point. All duties collected by the Imperial Chinese Customs go to the Central Government at Peking, and if the duties on the opium sent across per Burmah are all to be collected by the Customs, it would be so much off the provincial revenue, and the strongest provincial opposition would be aroused. If some such scheme as I propose can be adopted-

(1.) The provincial authorities ought to be very glad, as the proper payment of their li-kins would be secured and a check put on the present system of peculation.

(2.) The Peking authorities need not object, as they would get customs export duty at Tengyuen, which they do not get now.

(3.) Merchants would be satisfied, as they would know exactly what they had to pay, and would have the advantage of safe and cheap transport.

(4.) Burman would gain by the carriage of the drug across her territory and by the convenience of having a return export trade which would stimulate her import trade to China. The importance of Bhamo as the emporium of the trade would be much increased.

Thus, i think, no one except the underlings and bandits who prey on the trade as now conducted would have cause to complain.

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4. Information is required as to the cost of the carriage of Yunnan opium across China, including provincial taxes, &c., also freight and other items of expenditure which would be incurred in carriage of opium vià Tengyueh to Bhamo.

I cannot guarantee the accuracy of all the figures given below, most of which were collected in Yünnan-fu some two years ago. Tengyuch merchants can give no details beyond Yunnan- fu, as the opium there passes out of their hands; further, freights and li-kins are constantly changing. I believe that heavy additional li-kin on native opium consumed in Canton has recently been imposed, but I have no exact information.

In any case, whatever the total li-kin and other charges in the province of destination may amount to, they will equally have to be paid, if the scheme now submitted is adopted.

The mule load of opium in Yünnan is usually 2,400 Chinese ounces or taels in weight; this is 14 piculs, or 200 lb.-i.e., two boxes of opium, each weighing p icul or 100 lb, make a mule load.

If I take the picul of 1333 lb. of opium as the unit, and the place of provenance as Hsiakuan (Ta Li) which is the chief centre of opium production in West Yünnan, and the place of destination as Canton, I think the following estimate of cost would be approximately correct -----

(1.) Mule transport, Hsiakuan to Yunnan-fu, 7 rupees to 8 rupees per picul. (2.) Mule transport, Yünnan-fu to head of West River at Po Ngai, 14 rupees to 16 rupees per picul.

(3.) Boat transport down West River to Canton, 6 rupees to 8 rupees per picul, but varying greatly.

(4.) Handling, warehousing, &c., 5 rupees a picul. (5.) Yunnan li-kin as now levied, 66 rupees a picul.

(6.) Kwangsi transit li-kin, 18 rupees a pical.

(7.) Canton province entrance li-kin, 40 rupees a picul,

or, say, in all a total of 155 rupees per picul of 1334 lb. to get within the borders of Canton province from Hsiakuan.

This is the most direct way to Canton, but it has now been practically closed for some years, except at intervals, owing to disturbances on the Kwangsi frontier.

Opium has accordingly been sent via Kweichou to the headwaters of a branch of the West River at San Chueb, near Ku Chou, in South-East Kweichou. This entails extra charges of-

(1.) Kweichou transit li-kin, 25 rupees a picul, about;

(2.) Extra mule bire, 5 rupees, about.

Sometimes the river at the Ku Chou is also closed by bandits, and the drug is sent round by a corner of South-West Hunan with the following extra charges:

(1.) Hunan transit li-kin, 16 rupees a picul, about;

(2.) Extra carriage probably 7 rupees; possibly, by taking a still wider detour through Hanan and paying a little more freight Kwangsi transit li-kin might be avoided.

To the above charges a large but very uncertain addition must be made for armed escorts, blackmail paid to robbers, &c. On the other hand, sometimes the payment of li-kin is avoided by payment of a bribe of less amount.

On the whole, I regret that it is impossible for me, here, to submit a precise auswer to the question put to me; but it may, I think, be safely said that the cost of getting Hsiakuan opium within the borders of Canton Province by the inland routes is never less than 200 rupees a picul.

At the present moment, owing to reports of wholesale robberies on the Kwangsi border near Ku Chou, there is but little trade that way, but these suspensions of trade, if frequent, are temporary only, for, by hook or by crook, West Yünnan has to get its opium out, for opium is the only means which the country possess to pay for its cotton, ie, for the clothing of the people.

The average value of opium at an ordinary rate at Hsiakuan, not including li-kin, is 350 taels to 450 taels (say, 700 rupees to 900 rupees) a load, i.e., a load of 200 lb., or piculs; that is, 460 rupees to 600 rupees a picul of 1334 lb.; the difference given is that between the best and worst qualities.

If Hsiakuan opium was to be sent to Tengyueh and Bhamo, the charges would be as follows :-

[1844 --1]

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