CO129-344 - Public Offices & Foreign Office - 1907 — Page 429

(This Document is the Property of His Britannic Majesty's Government.]

C

25167

CHINA RAILWAYS,

CONFIDENTIAL.

[14944]

No. 1.

427

May

RECE

STRON 16 JUL 07,

(1-2 2000)

Sir J. Jordan to Sir Edward Grey.--(Received May 7.)

(No. 72.) (Telegraphic.) P.

Peking, May 7, 1907. I HAVE received a telegram from His Majesty's Consul-General at Hankow to the effect that at a recent interview the Viceroy of Wuchang informed him that the Yokohama Specie Bank had offered him a loan. The Viceroy replied to the Manager that he required 20,000,000 taels, and the Manager then said that as one large sum would require English co-operation, he must telegraph to his head office.

Finally, the following terms were blocked out: Amount of loan to be 3,000,000/. at 5 per cent. interest, actual payment to be 951. per hundred, term of loan to be 30 years, purpose of loan public works and security to be the guarantee of the Board of Reorganization. Imperial sanction to be obtained by Viceroy and Chinese Ministers in London and Tokió respectively to seal the bonds. In the conversation between Viceroy and Manager, latter argued that Viceroy's undertaking to give British first option only referred to railway, and that therefore this transaction was not affected thereby.

At interview between Viceroy and His Majesty's Consul-General, Viceroy said he anticipated no difficulty in procuring Imperial sanction, nor that any awkward questions would be asked respecting the ultimate use of the money. He remarked that he considered himself free to close with the Japanese Bank if British financiers would not offer better terms,

I am informed by Mr. Bland (who has consulted M. Casenave) that there is no objection to Japanese participation; if, however, the Viceroy wants the loan for railway purposes, it would be essential to clearly define construction and supervision of finances. If, on the other hand, the loan is for general purposes, exclusive of railways, it would be practicable to arrange an Anglo-Japanese one.

I have replied to His Majesty's Consul-General to this effect, and pointed out to him that we are precluded from supporting a purely Anglo-Japanese combination for railway construction in Yang-tsze region without French participation by the Agreements between the English and French groups.

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