[This Document is the Property of His Britannic Majesty's Government.]
AFFAIRS OF CHINA.
CONFIDENTIAL.
[January 7:]
C. C.
410
3394
SECTIO1.29 JAN 08
[637]
Sir,
No. 1.
Peking Syndicate to Foreign Office.--(Received January 7.)
110, Cannon Street, London, January 6, 1908.
IN reference to previous correspondence regarding the negotiations now pending at Peking for the repurchase of the Shansi Concession, I am instructed by my Directors to put before you the present position of affairs, with a view to eliciting on the part of Secretary Sir Edward Grey some expression of opinion for their guidance.
As stated in my letter of the 12th November, the sum which the Syndicate originally asked for the surrender of the Concession was 1,500,000, being, in the Directors' opinion, a fair estimate of the compensation which the shareholders were entitled to receive, and a sum which corresponded to the claim for damages, at the rate of 200l. per day, presented to the Chinese Government on the 31st December, 1906. Feeling, however, that it would be impossible, under present circumstances, to recover from the Chinese authorities so large a sum, the Directors reduced the limit first to 750,000, and then to 4,000,000 taels, approximately 500,000l.
After two months of negotiations the utmost amount which the Chinese authorities have been induced to offer is 2,625,000 taels, equivalent at present exchange to 335,000l. This sum cannot in any sense be regarded as a compensation for the surrender of the Concession, and is indeed barely sufficient to cover our outlay up to date in respect to the Shansi Concession. My Directors, however, are given to understand that, in the opinion of Sir John Jordan, this offer, which is made by the Shansi Delegates, is very near their limit, and also that, if not at once accepted, it may be withdrawn. My Directors are thus placed in an exceedingly difficult position. On the one hand, the acceptance of such a small sum cannot be viewed by the shareholders with other than feelings of great disappointment; on the other hand, it is to be feared that, after all the antagonism which has been aroused, through no fault of ours, even if a permit to work were now to be granted, it would be impossible to carry on mining operations with any prospect of success.
Under these circumstances, my Directors again venture to appeal to His Majesty's Government. The point on which they would be grateful for advice is whether anything is to be gained by further waiting, whether any form of diplomatic pressure yet remains untried to induce the Chinese Government to meet the Syndicate on more liberal terms. The negotiations so far have been conducted by Delegates representing the Province of Shansi, and it is understood that the province will supply the redemption funds. So far as my Directors are aware the Central Government has stood aloof and has done nothing to bring pressure to bear on the Provincial Delegates. But the Central Government, which ratified the Concession, is equally interested or even more so in seeing that its obligations are fulfilled. It is indeed to the Central Government and the Central Government alone that the Syndicate can look for satisfaction, and it was against the Central Government that the claim of 200l. per day for damages was preferred. If therefore the Central Government can neither coerce the provincials into allowing the Syndicate to work without hindrance nor require the Delegates to raise their limit so as to meet the Syndicate's terms, then it follows that the Central Government may properly be called upon to make up the difference out of its own funds. It is in this direction that my Directors venture to hope that something may yet be done by diplomatic pressure.
I am to add that a report has reached my Directors that a foreigner on the Viceroy's staff at Tien-tsin is in treaty with certain interested parties in Shansi for the exploitation of mineral areas within the Syndicate's Concession, and that an engineer has been sent out from this country at considerable expense to advise on the matter. My Directors would consider this, if true, as a still more flagrant breach of the Concession, and in view of such a contingency they would desire to stipulate in any arrangement that may be come to, that, in event hereafter of any foreign advice or any financial assistance being required in Shansi, the Peking Syndicate should have priority. If such a stipulation were entered into in good faith, my Directors would be prepared to cancel the present Concession for the sum of 3,000,000 taels,
I have, &c.
(Signed) THOS. GILBERT, Secretary,
[2818 y-1]
L'
[This Document is the Property of His Britannic Majesty's Government.]
AFFAIRS OF CHINA.
CONFIDENTIAL.
[January 7:]
C. C.
410
3394
SECTIO1.29 JAN 08
[637]
Sir,
No. 1.
Peking Syndicate to Foreign Office.--(Received January 7.)
110, Cannon Street, London, January 6, 1908.
IN reference to previous correspondence regarding the negotiations now pending at Peking for the repurchase of the Shansi Concession, I am instructed by my Directors to put before you the present position of affairs, with a view to eliciting on the part of Secretary Sir Edward Grey some expression of opinion for their guidance.
As stated in my letter of the 12th November, the sum which the Syndicate originally asked for the surrender of the Concession was 1,500,000, being, in the Directors' opinion, a fair estimate of the compensation which the shareholders were entitled to receive, and a sum which corresponded to the claim for damages, at the rate of 2007. per day, presented to the Chinese Government on the 31st December, 1906. Feeling, however, that it would be impossible, under present circumstances, to recover from the Chinese authorities so large a sum, the Directors reduced the limit first to 750,000, and then to 4,000,000 taels, approximately 500,0007.
After two months of negotiations the utmost amount which the Chinese authorities have been induced to offer is 2,625,000 taels, equivalent at present exchange to 335,000%. This sum cannot in any sense be regarded as a compensation for the surrender of the Concession, and is indeed barely sufficient to cover our outlay up to date in respect to the Shansi Concession. My Directors, however, are given to understand that, in the opinion of Sir John Jordan, this offer, which is made by the Shansi Delegates, is very near their limit, and also that, if not at once accepted, it may be withdrawn. My Directors are thus placed in an exceedingly difficult position. On the one hand, the acceptance of such a small sum cannot be viewed by the shareholders with other than feelings of great disappointment; on the other hand, it is to he feared that, after all the antagonism which has been aroused, through no fault of ours, even if a permit to work were now to be granted, it would be impossible to carry on mining operations with any prospect of success.
Under these circumstances, my Directors again venture to appeal to His Majesty's Government. The point on which they would be grateful for advice is whether anything is to be gained by further waiting, whether any form of diplomatic pressure yet remains untried to induce the Chinese Government to meet the Syndicate on more liberal terms. The negotiations so far have been conducted by Delegates representing the Province of Shansi, and it is understood that the province will supply the redemption funds. So far as my Directors are aware the Central Government has stood aloof and has done nothing to bring pressure to hear on the Provincial Delegates. But the Central Government, which ratified the Concession, is equally interested or even more so in seeing that its obligations are fulfilled. It is indeed to the Central Government and the Central Government alone that the Syndicate can look for satisfaction, and it was against the Central Government that the claim of 2001. per day for damages was preferred. If therefore the Central Government can neither coerce the provincials into allowing the Syndicate to work without hindrance nor require the Delegates to raise their limit so as to meet the Syndicate's terms, then it follows that the Central Government may properly be called upon to make up the difference out of its own funds. It is in this direction that my Directors venture to hope that something may yet be done by diplomatic pressure.
I am to add that a report has reached my Directors that a foreigner on the Viceroy's staff at Tien-tsin is in treaty with certain interested parties in Shansi for the exploitation of mineral areas within the Syndicate's Concession, and that an engineer has been sent out from this country at considerable expense to advise on the matter. My Directors would consider this, if true, as a still more flagrant breach of the Concession, and in view of such a contingency they would desire to stipulate in any arrangement that may be come to, that, in event hereafter of any foreign advice or any financial assistance being required in Shansi, the Peking Syndicate should have priority. If such a stipulation were entered into in good faith, my Directors would be prepared to cancel the present Concession for the sum of 3,000,000 taels,
I have, &c. (Signed) THOS. GILBERT, Secretary,
[2818 y-1]
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