CO129-352 - Public Offices - 1908 — Page 511

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signed. This Board, having reported the transaction to the Throne on the 27th June, and having received the Imperial Decree "Noted," request your Highness to inform His Britannic Majesty's Minister."

In the 17th year of Kuang Hsu (1891) the Tsung-li Yamén informed the foreign Representatives at Peking that Chinese officials, high and low, making loans from foreign merchants must memorialize the Throne and place the transactions on record beforehand. In the present instance the Board of Communications, having concluded a loan of 1,000,000 Kuei-p'ing taels with the Peking branch of the Hong Kong and Shanghae Banking Corporation, have declared that the transaction has been reported to and authorized by the Throne.

I have the honour to communicate the above-mentioned facts for your Excellency's information, and to request that the Hong Kong and Shanghae Banking Corporation may be directed to act in accordance with the Agreement.

I avail, &c. (Signed) Prince CHING,

Inclosure 3 in No. 1.

Sir J. Jordan to Mr. E. Hillier.

Sir,

British Legation, Peking, July 1, 1903. WITH reference to your letter of the 20th June, I beg to inform you that I received last evening from the Wai-wu Pu an official communication stating that the Agreement for a loan of 1,000,000 taels, which was concluded by your bank with the Board of Communications on the 20th June, has been reported to the Throne and authorized by Imperial Decree.

A translation of the Wai-wu Pa's despatch is inclosed herewith.*

I am, &c. (Signed) J. N. JORDAN.

• See Inclosure 2.

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This Document is the Property of His Britannic Majesty's

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34061

13 SEP 09

AFFAIRS OF CHINA.

CONFIDENTIAL,

[29948]

No. 1.

[August 29.]

SECTION 1.

Sir C. MacDonald to Sir Edward Grey.-(Received August 29.)

(No. 198. Confidential.) Sir,

Tokió, August 1, 1908. WITH reference to your despatch No. 21, Consular, of the 29th April, I have the honour to transmit herewith a Report on a journey to Manchuria recently made hy His Majesty's Vice-Consul at Dairen. In accordance with your instructions Mr. Parlett has devoted special attention to the question of railway Settlements, as well as to that of the prospects of British trade at Harbin. British trade at present appears to be very small in North Manchuria, and the duties of a Consul at Harbin would be more those of a Political Agent than those usually associated with the office of Consul. As Sir John Jordan points out in his despatch No. 817 of the 14th July to you, His Majesty's Consul-General at Mukden is Consul-General for Manchuria, and, as such, pays periodical visits to Harbin. Until, therefore, there is a large increase in British trade, or until such time as His Majesty's Government may, for political reasons. consider it expedient to have an Agent at Harbin, I agree with Sir John Jordan that there appears to be no immediate necessity for appointing a special Consular officer to the post.

Mr. Parlett at the same time lays stress on the potentialities of North Manchuria and suggests that a careful investigation by experts, under the auspices of some representative body like the China Association, might with advantage be made. Sir Alexander Hosie has, however, recently been over all the ground, and his views are embodied in the Report which was forwarded to His Majesty's Government, the contents of which are doubtless known to the China Association.

The most interesting part in Mr. Parlett's Report lies in what he has to say about the South Manchurian Railway Company and its intimate connection with the Mitsui Bussan Kwaisha. This firm is the most powerful Japanese firm in existence, possessing as it does the strongest political support in Tokió, and, though it has always been difficult to lay any definite charge of differential treatment at the doors of the Japanese in Manchuria, the charges that have-often too recklessly-been made are doubtless in part due to the knowledge of the subtle relationship existing between this firm and the Railway Company.

And

As to the imperium in imperio ordained by the Railway Company with its claim to administrative rights in the railway Settlement and the civil government of Kwantung, it is not unnatural that friction between the respective officials should ensue. this friction is not likely to grow less by reason of Baron Goto's removal to Tôkiô, as he will still be able to directly supervise the management of the Railway Company, and may be expected to support a system which he has created. It appears all too evident that the system of administration in the railway Settlements is gradually assimilating itself to that claimed by the Russians at Harbin. In this connection, namely, that of the growing community of interests between the Russians and the Japanese in Manchuria, I am given to understand that Baron Goto, when in St. Petersburgh, canvassed the support, at any rate the moral support, of the Russian Government on the question of the Fakumen Railway on the ground that its eventual continuation to Tsitsihar would be no less disadvantageous to the Russians than it was to the Japanese.

Mr. Parlett finally proposes that a junior member of the Japan Consular Service should be attached to His Majesty's Consulate-General at Mukden in view of the growing influence of the Japanese in Manchuria and the advantage of keeping in close touch with Japanese policy, railway and political. Sir John Jordan, while recognizing these advantages, considers that it might be a matter of offence to the Chinese in general, and Tong Shoayi in particular, as likely to give the impression

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