[This Document is the Property of His Britannic Majesty's Government.}
C. O.
31455
AFFAIRS OF CHINA.
[July 23.]
rd 2 SEP 07
CONFIDENTIAL,
SECTION 1.
[24554]
No. 1.
Sir,
Peking Syndicate to Foreign Office.-(Received July 23.)
110, Cannon Street, London, July 22, 1907. I AM instructed by my Directors to acknowledge receipt of your letter of the 11th instant, replying to mine of the 24th ultimo, on the subject of the attitude of the Chinese Government in respect to the Syndicate's Shansi Smelting Agreement of 1905, and intimating that Sir Edward Grey, being of opinion that the original state of affairs has been restored by the disclaimer of the Chinese to take part in the smelting undertaking, proposes to address a despatch to Sir John Jordan requesting him, if he sees no objection, to inform the Chinese Government that, in view of their refusal to carry out the Agreement for joint working which was entered into at their own request, the Syndicate propose to undertake the work themselves, in accordance with their original Concession.
In reply, I am to state that my Directors fully concur in the proposed procedure as far as it goes, but they must confess to some feeling of disappointment that no intimation is conveyed of what it is intended to do in the event, which is practically certain, of the Chinese Government refusing to allow the Syndicate to proceed with the work. Permission to smelt iron necessarily implies the permission to work coal, but this very permission has been refused, and continues to be refused, in spite of all our efforts. In the view of my Directors, therefore, the bare intimation that the Syndicate proposes to undertake the work of iron-smelting themselves, if unaccom- panied by some warning of the consequences of refusal, would be simply ignored by the Chinese Government, and matters would be no further advanced. It was for this reason that they suggested that, in the event of the Chinese Government persisting in its refusal, a further claim of 1001. per day should be lodged as a penalty in respect to iron.
If, however, Sir Edward Grey is of opinion, as intimated in the last paragraph of your letter, that it would at present be useless to present a further claim, my Directors do not insist, but they do earnestly ask that the claim for 2001. per diem already presented be pressed with all the weight of His Majesty's Government. The object of the Syndicate in formulating this claim was not so much to recover damages, though serious loss and damage are being suffered, as to compel the Chinese Govern- ment to realize that an Imperially ratified Agreement, such as the Shansi Concession is, cannot be broken with impunity. So far it does not appear that the presentation of the claim has made the least impression on the Chinese Government. It is treated in effect with scorn, and nothing whatever is being done, so far as my Directors are aware, to meet the just claims of the Syndicate.
My Directors respectfully submit that the time has come to give the Chinese Government clearly to understand that this cannot go on. Either the Syndicate must be allowed to carry on its operations in terms of the Concession, or the Concession must be redeemed with adequate compensation. My Directors cannot suggest any better way of leading up to a solution than to insist on the payment de die in diem of the claim as already presented, but they are of course ready to submit to the judgment of Sir Edward Grey if any other method seems to him more appropriate. In any case, in view of the large interests committed to their charge, they feel bound, while regretting the necessity, to press their case on Sir Edward Grey with all the earnestness in their power.
I have, &c.
(Signed) THOS. GILBERT, Secretary,
[2570 %-1]
708
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