This Document is the Property of His Britannic Majesty's Government
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# CHINA RAILWAYS.
**CONFIDENTIAL.**
(21207)
No. 1.
[June 20 1908] JUL 08
## SECTION 3,
(Confidential.) Sir,
Colonial Office to Foreign Office.-(Received June 20.)
Downing Street, June 19, 1908. WITH reference to your letter of the 2nd ultimo and to previous correspondence respecting the Canton-Kowloon Railway, I am directed by the Earl of Crewe to transmit to you the accompanying draft of a despatch which he proposes, with the concurrence of Secretary Sir E. Grey, to address to the Governor of Hong Kong on the subject.
2. If Sir E. Grey agrees in the terms of the draft, I am to suggest that it would be convenient that a copy should be sent to Sir J. Jordan for his confidential information.
I am, &c. (Signed)
H. BERTRAM COX.
(Secret.) Sir,
## Inclosure in No. 1.
Draft of Despatch from the Earl of Crewe to Governor Sir F. D. Lugard.
Downing Street, June 1908. IN his despatch of the 22nd October, 1907, my predecessor transmitted to you a letter from the Consulting Engineers on the subject of a working Agreement for the railway from Canton to Kowloon. You were desirous that the Consulting Engineers should formulate their suggestions as soon as possible, with a view to your initiating the preliminary negotiations, but they then expressed the opinion that the time had not arrived for considering the terms of a working Agreement, as these must greatly depend on considerations with regard to which sufficient information was not yet available.
2. I do not find that you have since recurred to the subject, and I presume that you accepted the view of the Consulting Engineers. So long as Sir John Wolfe Barry and Mr. A. J. Barry were also recognized as Consulting Engineers for the Chinese section, it did not appear that the position would be prejudiced by delay in discussing the details of a working Agreement, but the question has assumed a new aspect, owing to the unwillingness of the Chinese Administration to continue this arrangement. As you are aware, I have been in correspondence with the Secretary of State for Foreign Affairs on this matter, and I was in hopes that His Majesty's Minister in Peking would have been able to take active steps to induce the Chinese Government to reconsider their attitude. I am unable, however, to find that Sir John Jordan has been able to effect this, and it is therefore necessary to consider if any other steps can be taken to safeguard the interests of the Hong Kong Railway.
3. The possible dangers which I foresee are threefold. In the first place, I have heard that Chinese merchants and officials are pressing the idea of making a Chinese port the terminus of the trunk line, and have been making speculative purchases of land at Whampoa with that object. It is obvious that such a policy, if carried into execution, would be most detrimental to the interests of Hong Kong, and, as it is opposed to the terms of the loan Agreement, His Majesty's Government would be justified in using every means at their disposal to resist it.
4. In the second place, I am informed that on other lines constructed by foreign capital the Chinese Government have shown a disposition to strangle goods traffic by the imposition of li-kin charges. This also would be gravely prejudicial to the success of the Hong Kong line, but, while it is a point to be borne in mind when the details of a working Agreement are under discussion, it is not a matter which calls for immediate action.
5. Finally, according to my information, the Chinese Government consider, or affect to consider, that the lines constructed under the auspices of the British and
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This Document is the Property of His Britannic Majesty's Government I
2446
33
CHINA RAILWAYS.
CONFIDENTIAL.
(21207]
No. 1.
[June 2017 JUL 08
SECTION 3,
(Confidential.) Sir,
Colonial Office to Foreign Office.-(Received June 20.)
Downing Street, June 19, 1908. WITH reference to your letter of the 2nd ultimo and to previous correspondence respecting the Canton-Kowloon Railway, I am directed by the Earl of Crewe to transmit to you the accompanying draft of a despatch which he proposes, with the concurrence of Secretary Sir E. Grey, to address to the Governor of Hong Kong on the subject.
2. If Sir E. Grey agrees in the terms of the draft, I am to suggest that it would be convenient that a copy should be sent to Sir J. Jordan for his confidential information.
I am, &c. (Signed)
H. BERTRAM COX.
(Secret.) Sir,
Inclosure in No. 1.
Draft of Despatch from the Earl of Crews to Governor Sir F. D. Lugard.
Downing Street, June 1908. IN his despatch of the 22nd October, 1907, my predecessor transmitted to you a letter from the Consulting Engineers on the subject of a working Agreement for the railway from Canton to Kowloon, You were desirous that the Consulting Engineers should formulate their suggestions as soon as possible, with a view to your initiating the preliminary negotiations, but they then expressed the opinion that the time had not arrived for considering the terms of a working Agreement, as these must greatly depend on considerations with regard to which sufficient information was not yet available.
2. I do not find that you have since recurred to the subject, and I presume that you accepted the view of the Consulting Engineers. So long as Sir John Wolfe Barry and Mr. A. J. Barry were also recognized as Consulting Engineers for the Chinese section it did not appear that the position would be prejudiced by delay in discussing the details of a working Agreement, but the question has assumed a new aspect, owing to the unwillingness of the Chinese Administration to continue this arrange- ment. As you are aware, I have been in correspondence with the Secretary of State for Foreign Affairs on this matter, and I was in hopes that His Majesty's Minister in Peking would have been able to take active steps to induce the Chinese Government to reconsider their attitude. I am unable, however, to find that Sir John Jordan has been able to effect this, and it is therefore necessary to consider if any other steps can be taken to safeguard the interests of the Hong Kong Railway.
3. The possible dangers which I foresee are threefold. In the first place, I have heard that Chinese merchants and officials are pressing the idea of making a Chinese port the terminus of the trunk line, and have been making speculative purchases of land at Whampoa with that object. It is obvious that such a policy, if carried into execution, would be most detrimental to the interests of Hong Kong, and, as it is opposed to the terms of the loan Agreement, His Majesty's Government would be justified in using every means at their disposal to resist it.
4. In the second place, I am informed that on other lines constructed by foreign capital the Chinese Government have shown a disposition to strangle goods traffic by the imposition of li-kin charges. This also would be gravely prejudicial to the success of the Hong Kong line, but, while it is a point to be borne in mind when the details of a working Agreement are under discussion, it is not a matter which call for immediate action.
5. Finally, according to my information, the Chinese Government consider, or affect to consider, that the lines constructed under the auspices of the British and
[1814 u-3]
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