300
DOMESTIC.
2
Mr. Hillier, however, maintained his position, which he defended by showing that he, too, had his "gentry "--the investing public-to consider. Without such a safe- guard, he pointed out, there would be nothing to prevent the application of loan funds borrowed for railway construction to other uses.
After a long discussion, Mr. Liang yielded so far as to ask him to put in writing exactly what he desired, in order that it might be submitted to the Viceroy, and the meeting terminated.
On the following day, Messrs. Hillier and Cordes sent to Mr. Liang the Memorandum, copy of which I have the honour to inclose,
At their next meeting on the 17th August, the Viceroy's reply was communicated to them. His Excellency refused to entertain the proposal, which he considered unnecessary on the ground that China unconditionally guaranteed the loun.
Mr. Hillier thereupon said that, in view of this reply, he could go no further, but must communicate the Viceroy's refusal to his principals by telegraph, and await their instructions. Mr. Liang urged him to advise the abandonment of the condition, and the whole question was discussed again in detail, with the result that, although Mr. Liang made no definite pronouncement implying ultimate acquiescence, he left the two foreign negotiators with the impression that if they stuck to their guns the point might be gained.
Both of the foreign negotiators have now received instructions from their principals to maintain these conditions, and a meeting with Liang Ta-jên has been fixed for to-morrow, the 21st August. From information which has reached me from the Grand Secretary Na and Mr. Wang Ta Hsieh, I do not feel sanguine that the two bankers will be able to carry their point, and foresee that further intervention by my German colleague and myself will become necessary.
I have, &c.
(Signed)
J. N. JORDAN.
Inclosure in No. 1.
Memorandum communicated by Messrs. Hillier and Cordes to Mr. Liang,
THE construction and operation of the Tien-tsin-Yang-tsze Railway are to be entirely under the control of the Chinese Imperial Government.
The following stipulations do not in any way impair China's control of the line. They are intended to inspire confidence in the investing public by satisfying them as to the proper application of the loan funds. To omit these conditions from the prospectus would evoke unfavourable criticism, and have a very detrimental effect on China's credit :----
1. During the construction of the railway the Chief Engineers of the northern and southern sections are to be German and British subjects respectively, and, together with the Chief Accountant of the railway, are to be selected and appointed by the Chinese Government, and are to be acceptable to the Syndicate Banks,
2. Orders of the Chinese Managing Director upon loan funds are to be accompanied by certificates of the Chief Engineer and Chief Accountant, stating the nature and cost of the work to be paid for.
3. The Syndicate Banks will be furnished with regular statements of the working accounts of the railway signed by the Chief Accountant.
Peking, August 14, 1907.
ice or Individual.
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1907
27
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No.
No.3 740.5.
(Subject.)
C C
37405
R 23 OCT 07
Peracis in Canton waters
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