(This Document is the Property of His Britannic Majesty's Government.]
CHINA RAILWAYS.
CONFIDENTIAL.
[21614]
No. 1.
657
[July 1.]
SECTION 5.
0.0.
29968
RECE
REC 21 AUG 07)
!
Sir J. Jordan to Sir Edward Grey. (Received July 1.) (No. 240. Confidential.) Sir,
Peking, May 16, 1907. I HAVE the honour to refer you to my telegram No. 72, Confidential, of the 7th May, and subsequent telegraphic correspondence respecting the loan which was offered to the Viceroy of Wuchang by the Yokohama Specie Bank. My telegrams will have placed you in receipt of all the information at present at the disposal of this Legation. The situation, is, however, somewhat complicated owing to the fact that negotiations would seem to have been carried on in London between the Yokohama Specie Bank and Parr's and the Hong Kong and Shanghae Banks, the exact nature of which is still obscure. Mr. Bland, the Peking Agent of the British and Chinese Corporation, and Mr. Gardner, the Acting Peking Agent of the Hong Kong and Shanghae Bank, are equally in the dark as to the attitude adopted by the latter. In my conversations with these two gentlemen and in my telegrams to His Majesty's Consul-General at Hankow. I have throughout kept in view the fact that we are committed to the Chinese Central Railways for the Hankow-Szechuan line, and to the British and Chinese Corporation for the Hankow-Canton line, and that, in addition, our undertakings to the French Government preclude us from supporting any other than these two Associations in which the French are financially interested. If the Viceroy desired to raise a loan for other than railway purposes, the Hong Kong and Shanghae Bank would, I presume, be free to do as it pleased, and it may be due to the fact that the original purpose of the loan now under discussion was merely stated to be for 'public works that the present complications have ensued. As it is now evident, however, that the loan is meant for railway purposes (see my telegram No. 77 of the 11th May), the situation should soon be cleared up. With this object in view, Mr. Bland proceeded yesterday to Hankow to meet Mr. Hillier, the Peking Agent of the Hong Kong and Shanghae Bank, who is now on his way there from Shanghae.
•
He will discuss the situation with him and endeavour to arrange an interview with the Viceroy, with the assistance of Mr. Fraser,
The statement that the Yokohama Specie Bank had withdrawn their proposal for a loan (see my telegram No. 81 of the 15th May) rests upon a telegram to that effect received by Mr. Gardner from the Shanghae Office of the Hong Kong and Shanghae Bank. Mr. Fraser, in a telegram of yesterday's date, states, however, that the Japanese Consul, whom he had just seen, gave him no reason to suppose that the proposal had been withdrawn.
A few days ago I had a conversation with my Japanese colleague, who confirmed generally the statements made by the Japanese Consul to Mr. Fraser and reported in the latter's despatch No. 43 of the 11th May, copy of which I have the honour to inclose. I explained to Mr. Hayashi the nature of the Viceroy's undertaking to apply to British capital first for a loan for the construction of the Hankow-Canton and other lines, and he fully recognized that the existence of these engagements would have to be taken into account in the conduct of the negotiations.
(No. 43. Confidential.) Sir,
I have, &c.
(Signed)
J. N. JORDAN,
Inclosure in No. 1.
Consul-General Fraser to Sir J. Jordan.
Hankow, May 11, 1907.
WITH reference to the Viceroy's scheme to obtain funds for railway construction by means of a loan for industrial purposes, I have the honour to report visits paid me by
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