2
of the Contract, it only remained for them to lodge with the Government of China formal protest against the execution of the work,
The British Government, to which a copy of the self-denying stipulation above quoted had been communicated early in 1906, do not, it is understood, question the validity of Japan's objections, but the Newchwang Chamber of Commerce thinks otherwise, and on the 13th March last adopted the following Resolution :
The Newchwang General Chamber of Commerce, being convinced that the extension of the Imperial Railway of North China from Hsinmintun to Fakumen and beyond, is vitally important to the development and prosperity of Manchurian trade, strongly protests against the steps now being taken by the Government of Japan to enforce the abandonment of this extension, Japan having specifically undertaken in the Treaty of Portsmouth-
"Not to obstruct any general measures common to all countries which China may take for the development of commerce and industry in Manchuria.”
The Chairman of the Chamber forwarded a copy of the Resolution to the Newchwang Consular Body, and in his covering letter, dated the 16th March, 1908, he gave what he declared to be the grounds upon which the views expressed in the Resolution had been arrived at. He admitted that the construction of branch lines westward from the South Manchurian Railway system would assist and promote the development which was the raison d'être of the Resolution, but, he naively added, that such branch lines, by diverting the trade to Dairen, would necessarily do incalculable injury to the prospects and trade of Newchwang. Finally, in the commercial interests of "Newchwang in particular" and of "Manchuria generally," he asked that a copy of his letter might be transmitted by the Consular Body to the Diplomatic Corps in Peking, and he stated that the Committee of the Chamber "regard the question at issue as of such vital and far-reaching importance that it intends by every means available to give publicity to the views herein expressed, and to that end purposes communicating the substance of these representations to the various Chambers of Commerce and kindred Associations, and to the leading press of China, Europe, and America,"
The Consular Body did not, for obvious reasons, transmit the letter in question to the Diplomatic Corps as requested, but the Committee of the Newchwang Chamber has evidently carried out its threat of appealing directly to the public against the action of Japan, since the Shanghae Chamber of Commerce has taken up the issue in the interest of Newchwang.
If the representation of the Committee of the Newchwang Chamber had contained only a fair and impartial statement of the case, it might well have been permitted to remain unanswered. But it is characterized by loose-thinking, extravagant assertions and illogical conclusions and, coming as it does from a body of intelligent and responsible merchants whose utterances are entitled to consideration, it is due to truth and fair dealing that its errors should be corrected and its fallacies exposed.
The first assertions in the letter under discussion that call for examination are-
(a.) That the Liao River constitutes a natural traffic boundary between the projected Hsinmintun-Fakumen line and the existing South Manchurian system;
(b.) That the trade of Fakumen and its hinterland has always found its outlet to the seaboard at Newchwang, Chinwantao, &c., through Hsinmintun, and thence by the Hsinmintun-Kaopantsze line;
(c.) That such trade has never gone eastward towards the townships and districts operated by the South Manchurian system; and
(d.) That consequently there are no grounds for Japan's contention that the proposed new road must be competitive with, and detrimental to, the Japanese line.
It is inaccurate to say that the Liao-ho, in its reaches from Hsinmintun to Fakumen, forms a natural traffic boundary, or that the trade of Fakumen and its neighbourhood has never sought an outlet by means of the South Manchurian Railway. In those regions the river is easily passable and, as a matter of fact, readily ascertainable, the existing line actually serves, and has always served in the matter of transportation, the country to the west equally with that to the east of the river.
Produce in large quantities is conveyed from the Fakumen regions to Tieling in Chinese carts, and thence is carried southward by the existing railway system. Especially is this true of the winter season when the rivers are frozen over and the whole land becomes one broad, smooth highway.
3
The site of the projected railway is in that portion of the valley of the Liao which is now served by the Japanese line, and it may be assumed, without fear of contradiction, that the proposed line, if constructed, would draw away from the existing system some portion of its traffic. Sir A. Hosie, the Acting British Commercial Attaché at Peking, in writing recently, on the subject of the commercial situation in Manchuria, said:-
"It is true that the Imperial railways of North China are competing successfully with the Japanese line from Newchwang to Mukden."
If this be true under present conditions, it cannot be doubted that with an extension of the Chinese line, there would be, at least, a corresponding extension of competition,
Russia, at the time when she owned the South Manchurian Railway, clearly foresaw the danger to be apprehended from possible competition, and to safeguard her interests in that respect she inserted in the Convention with China of the 8th April, 1899, relative to the restoration of Manchuria, a stipulation providing that in case, in future, an extension of the Shanhaikwan-Yinkow-Hsinmintun line or the construction of branch lines in the southern part of Manchuria, was to be undertaken, the matter should be previously arranged by an understanding between the Russian and Chinese Governments.
This measure of reasonable precaution did not provoke any hostile criticism. The silence on the part of British subjects may, however, be explained by the fact that they were at the time practically excluded from railway exploitation in regions north of the Great Wall by the Anglo-Russian understanding of the 28th April, 1899.
Japan, by Article 6 of the Treaty of Portsmouth and Article 1 of the Treaty of Peking of 1905, was subrogated to all the rights, privileges and properties of Russia in the South Manchurian Railway. But desiring to have her rights placed beyond question, she obtained from China the engagement to which the Newchwang Chamber of Commerce now so seriously objects.
If the engagement secured by Russia from Great Britain in 1899 and from China in 1902, were not unreasonable it is difficult to understand why Japan's engagement with China of 1905, should be condemned.
Equally exaggerated and, therefore, equally demanding examination, are the statements contained in the letter, on the subject of the scope and value of the engagement (already quoted) contained in the Protocol annexed to the Peking Treaty of 1905. After citing the engagement in question the letter declares :-
(a) That the country to be operated by the proposed line (Hsinmintun-Fakumen) cannot be considered to be in the neighbourhood of the South Manchurian Railway,"
(b) That as already demonstrated the proposed line neither will nor can be competitive with or in any way detrimental to the interests of the South Manchurian Railway.
(c.) That in no country in the world of similar population and topography, could or would the vested trade interests or sphere of an existing railway system be held to include so extensive an area, as to preclude the construction of other lines, even though competitive (if in the commercial sense that were possible) outside of a 35-mile limit.
(d.) That having in view Article 4 of the Treaty of Portsmouth Japan's action in exacting or receiving from China an undertaking such as is alleged, which is diametrically opposed in principle and practice to the pledge she had herself given to the world Powers, must be considered to have been ultra vires, and therefore the said undertaking by China to be null and void and of no effect.
Answering these several statements in the order in which they were made it may be said-
Firstly. The omission from paragraph (a), above quoted, of the words "and parallel to" which were conjunctively used with the phrase "in the neighbourhood of” in China's engagement of 1905, may be taken as an admission on the part of the Committee of the Newchwang Chamber, that the projected railway would parallel the existing line. The question whether it could be regarded as in the same neighbourhood, depends upon many considerations of more importance than mere distance.
Thus a railway, entering a valley, undivided by any impassable streams and already served...
[1841 s-1]
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393
2
of the Contract, it only remained for them to lodge with the Government of China formal protest against the execution of the work,
The British Government, to which a copy of the self-denying stipulation above quoted had been communicated early in 1906, do not, it is understood, question the validity of Japan's objections, but the Newchwang Chamber of Commerce thinks otherwise, and ou the 13th March last adopted the following Resolution :-----
The Newchwang General Chamber of Commerce, being convinced that the extension of the Imperial Railway of North China from Hsinmintun to Fakumen and beyoud, is vitally important to the development and prosperity of Manchurian trade, strongly protests against the steps now being taken by the Government of Japan to enforce the abandonment of this extension, Japan having specifically undertaken in the Treaty of Portsmouth-
"Not to obstruct any general measures common to all countries which China may take for the development of commerce and industry in Manchuria.”
The Chairman of the Chamber forwarded a copy of the Resolution to the New- chwang Consular Body, and in his covering letter, dated the 16th March, 1908, he gave what he declared to be the grounds upon which the views expressed in the Resolution had been arrived at. He admitted that the construction of branch lines westward from the South Manchurian Railway system would assist and promote the development which was the raison d'être of the Resolution, but, he naively added, that such branch lines, by diverting the trade to Dairen, would necessarily do incalculable injury to the prospects and trade of Newchwang. Finally, in the commercial interests of "Newebwang in particular" and of "Manchuria generally," he asked that a copy of his letter might be transmitted by the Consular Body to the Diplomatic Corps in Peking, and he stated that the Committee of the Chamber "regard the question at issue as of such vital and far-reaching importance that it intends by every means available to give publicity to the views herein expressed, and to that end purposes communicating the substance of these representations to the various Chambers of Commerce and kindred Associations, and to the leading press of China, Europe, and America,"
The Consular Body did not, for obvious reasons, transmit the letter in question to the Diplomatic Corps as requested, but the Committee of the Newchwang Chamber has evidently carried out its threat of appealing directly to the public against the action of Japan, since the Shanghae Chamber of Commerce has taken up the issue in the interest of Newchwang.
If the representation of the Committee of the Newchwang Chamber had contained only a fair and impartial statement of the case, it might well have been permitted to remain unanswered. But it is characterized by loose-thinking, extravagant assertions and illogical conclusions and, coming as it docs from a body of intelligent and responsible merchants whose utterances are entitled to consideration, it is due to truth and fair dealing that its errors should be corrected and its fallacies exposed.
The first assertions in the letter under discussion that call for examination are-
(a.) That the Liao River constitutes a natural traffic boundary between the projected Hsinmintun-Fakumen line and the existing South Manchurian system;
(b.) That the trade of Fakumen and its hinterland has always found its outlet to the seaboard at Newchwang, Chinwantao, &c., through Hsiumintun, and thence by the Hsinmiutun-Kaopantsze line;
(c.) That such trade has never gone eastward towards the townships and districts operated by the South Manchurian system; and
(d.) That consequently there are no grounds for Japan's contention that the proposed new road must be competitive with, and detrimental to, the Japanese line.
It is inaccurate to say that the Liao-ho, in its reaches from Hsinmintun to Fakumen, forms a natural traffic boundary, or that the trade of Fakumen and its neighbourhood has never sought an outlet by means of the South Manchurian Railway. In those regions the river is easily passable and, as a matter of fact, readily ascertain- able, the existing line actually serves, and has always served in the matter of trans- portation, the country to the west equally with that to the east of the river.
Produce
in large quantities is conveyed from the Fakumen regions to Tieling in Chinese carts, and thence is carried southward by the existing railway system. Especially is this true of the winter season when the rivers are frozen over and the whole land becomes one broad, smooth highway.
3
The site of the projected railway is in that portion of the valley of the Liao which now served by the Japanese line, and it may be assumed, without fear of contra- diction, that the proposed line, if constructed, would draw away from the existing system some portion of its traffic. Sir A. Hosie, the Acting British Commercial Attaché at Peking, in writing recently, on the subject of the commercial situation in Manchuria, said:-----
"It is true that the Imperial railways of North China are competing successfully with the Japanese line from Newchwang to Mukden."
If this be true under present conditions, it cannot be doubted that with an extension of the Chinese line, there would be, at least, a corresponding extension of competition,
Russia, at the time when she owned the South Manchurian Railway, clearly foresaw the danger to be apprehended from possible competition, and to safeguard her interests in that respect she inserted in the Convention with China of the 8th April, 1999, relative to the restoration of Manchuria, a stipulation providing that in case, in future, an extension of the Shanhaikwan-Yinkow-Hsinmintun line or the construction of branch lines in the southern part of Manchuria, was to be undertaken, the matter should be previously arranged by an understanding between the Russian and Chinese Governments.
This measure of reasonable precaution did not provoke any hostile criticism. The silence on the part of British subjects may, however, he explained by the fact that they were at the time practically excluded from railway exploitation in regions north of the Great Wall by the Anglo-Russian understanding of the 28th April, 1899.
Japan, by Article 6 of the Treaty of Portsmouth and Article 1 of the Treaty of Peking of 1905, was subrogated to all the rights, privileges and properties of Russia in the South Manchurian Railway. But desiring to have her rights placed beyond question, she obtained from China the engagement to which the Newchwang Chamber of Commerce now so seriously objects.
If the engagement secured by Russia from Great Britain in 1899 and from China in 1902, were not unreasonable it is difficult to understand why Japan's engagement with China of 1905, should be condemned.
Equally exaggerated and, therefore, equally demanding examination, are the state- ments contained in the letter, on the subject of the scope and value of the engagement (already quoted) contained in the Protocol annexed to the Peking Treaty of 1905. After citing the engagement in question the letter declares :-
(a) That the country to be operated by the proposed line (Hsinmintun- Fakumen) cannot be considered to be in the neighbourhood of the South Manchurian Railway,"
(b) That as already demonstrated the proposed line neither will nor can be competitive with or in any way detrimental to the interests of the South Manchurian Railway.
(c.) That in no country in the world of similar population and topography, could or would the vested trade interests or sphere of an existing railway system be held to include so extensive an area, as to preclude the construction of other lines, even though competitive (if in the commercial sense that were possible) outside of a 35-mile limit.
(d.) That having in view Article 4 of the Treaty of Portsmouth Japan's action in exacting or receiving from China an undertaking such as is alleged, which is diametrically opposed in principle and practice to the pledge she had herself given to the world Powers, must be considered to have been ultra vires, and therefore the said undertaking by China to be null and void and of no effect.
said-
Answering these several statements in the order in which they were made it be
may
Firstly. The omission from paragraph (a), above quoted, of the words "and parallel to
" which were conjunctively used with the phrase "in the neighbourhood of” in China's engagement of 1905, may be taken as an admission on the part of the Committee of the Newchwang Chaniber, that the projected railway would parallel the existing line. The question whether it could be regarded as in the same neighbourhood, depends upon many considerations of more importance than mere distance.
Thus a railway, entering a valley, undivided by any impassable streams and already
[1841 s-1]
B 2
393
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