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It has been agreed :-
1. That until further notice the negotiations will be carried on, as hitherto, at Tien-tsin.
2. That a special Deputy of the Board of Communications will attend the meetings. This Deputy will have full powers to represent the Yu-chuan Pu, and to express its opinions. He will report in person the result of each meeting to the Yu-chuan Pu.
3. That the Minutes of each meeting will be signed at the subsequent meeting by all the negotiators, and that the result therein recorded shall be regarded as finally accepted.
4. That the next meeting will take place on Saturday the 30th instant.
I beg to request your Highness to confirm by letter that the above is a correct résumé of the results of our interview.
In reference to the above, and in order that the negotiations may be placed on a definite and practical basis, with a view to the early settlement of this long protracted question, I have the honour to request your Highness that the special Deputy of the Yu-chuan Pu shall be furnished with such instructions as shall enable him and his colleagues to reply to the official letter addressed by the representatives of the Syndicate to the Chinese negotiators on the 9th instant, wherein it was requested that instructions on certain definite points at issue should be obtained from the Yu-chuan Pu.
A Chinese version of the letter in question is herewith inclosed.
My dear Sir John,
Inclosure 2 in No. 1.
Mr. Bland to Sir J. Jordan.
Peking, April 2, 1907.
Cordes and I INCLOSE a copy of the Minutes of our last meeting at Tien-tsin. I are of opinion that if we accept the position which the Chinese Representatives are trying to force upon us we shall be losing the last chance of successful negotiation, and that it would be better tactics to inform the Chinese point blank that we withdraw the concessions proposed in the draft Agreement and return to our position under the Preliminary Agreement, sanctioned by Imperial Edict, and shall hereafter submit a claim for compensation on the basis of that document which the Chinese Representa- tives decline to acknowledge. Cordes is coming up this afternoon to consult on the subject. As you will see by the Minutes, they have made it very difficult for us to go on, but perhaps some means may be found to avoid a definite issue and a deadlock.
I have to-day telegraphed to the B. and C. urging them to reconsider the question of priority of the Hangchow business, and I have expressed briefly the views which I hold on the subject, adding that if the joint interests (German and French) which I now represent are to be prejudiced in favour of the B. and C.'s business, it will be necessary for me to confine myself strictly to the Corporation's work, and it will be necessary for these joint interests to send out their own representatives. Where interests conflict, it is impossible for one man to render loyal service; and, if the policy of precedence is unavoidable, if outstanding preliminary Agreements, &c., cannot be dealt with simultaneously and with an equal measure of support, the sooner the Corporation disassociates itself from these joint interests the better. If it does not, I imagine that neither the German nor the French groups are likely to acquiesce in the indefinite postponement of the affairs in which they are interested.
I remain, &c.
(Signed) J. O. P. BLAND.
Inclosure 3 in No. 1.
TIEN-TSIN-YANGTSZE RAILWAY,
Minutes of the Thirtieth Meeting held at the Office of the Haikwan Taotai on Saturday, March 30, 1907.
Present:
Taotai Liang Tun-yon, representing the Board of Communications.
Chow,
Mr. Feng, Special Deputy from the Board of Communications. Mr. H. Cordes, representing the Deutsch-Asiatische Bank; and Mr. J. O. P. Bland, representing the Chinese Central Railways.
LIANG TAOTAI, introducing Mr. Feng, observes that as this gentleman does not speak English, the negotiations will hereafter be conducted in Chinese. Further, he states that the Board of Communications, replying to and complying with the request made by Chow Taotai and himself for the appointment of the special Deputy, notifies them that Mr. Feng's instructions are to go over the text of the draft Agreement recently submitted by the Syndicate's representatives, clause by clause, and to report on the negotiations in due course for the Board's information and approval.
Mr. Feng, replying to a question by Mr. Bland, states that these are the only instructions he has received. He is not in a position to afford the information asked for in the Syndicate's letter of the 9th instant, either as regards the system of control or the financial terms of the Agreement, having received no instructions on the subject.
Mr. Cordes says that, in this case, negotiations are likely to remain in status quo. He points out that Articles 1 to 14 of the draft Agreement have already been considered and adopted in principle, so that further discussion must involve those questions of control and finance, in regard to which a definite basis of negotiation and confirmation of the assurances given to the Syndicate's representatives, are indispensable. Upon the suggestion of Liang Taotai it is agreed that the text of Articles 1 to 14, with certain amendments, should be passed, and submitted by Mr. Feng to the Board of Communications. Article 15 is then discussed. Liang Taotai proposes its amendment to read, that if the amount specified for the loan should not be sufficient for the completion of the line, the balance required should be provided by the Chinese Government from its own resources. The impracticability of this method of finance having been explained by reference to the preliminary Agreement, Articles 1 and 13 are amended, at the request of the Chinese Commissioners, by the addition of clauses stating clearly that the final series of the loan shall be limited to the amount actually required to complete the construction and equipment of the line. Article 16 is discussed at considerable length. Referring to its conclusion, Liang Taotai expressed the opinion that if within the time limit of eighteen months, the Syndicate shall not have been able to issue the first series of the loan, then the sums advanced under the provisions of Article 3 should be forfeited.
The Syndicate's representatives decline to accept such a condition, pointing out that in the absence of political or financial crises entailing a serious decline in Chinese Government stocks, the first series of the loan must be issued, in accordance with terms of Article 13, within twelve months; furthermore that it is to the interest of the Syndicate to issue the loan as soon as possible, and that if, by reason of a serious decline in China's credit, this should not be feasible within eighteen months, the contract would be null and void-a result sufficiently prejudicial to the Syndicate without suggestion of further penalty. It is eventually agreed to reduce the twelve months' period in Article 13 to nine months, and to amend the conclusion of Article 16 after the word "contract" to read, "if within this time limit the first series of the loan shall not have been issued, then this contract shall become null and void."
Mr. Bland points out that the issue of the first series of the loan at a fixed price is a condition which has been insisted upon by the Chinese Commissioners, but that the Syndicate has declared itself prepared to finance it, like the second and subsequent series, at a fixed flotation commission of 54 points. If this method were adopted, Article 16 might be eliminated, and the Syndicate would be prepared to give the
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