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The following account of an interview which I had yesterday afternoon with Sir C. Liang Cheng, President of the Company, will, I venture to think, place you in possession of the latest and most authentic information regarding the affairs of the Canton-Hankow Railway :-
The President began by informing me that the annual general meeting of shareholders, held on the 27th instant at the Company's Head Office in Canton, had this year passed off in the most satisfactory manner. The attendance at the meeting had been unusually large, and the election of the three new Directors (one-third of the Directorate retire annually in rotation) had proceeded without a hitch. The meeting had been attended by the Provincial Treasurer, Provincial Judge, and two other officials as Representatives of the Viceroy and the Central Government. The rumour that these gentlemen had been appointed a Committee of Investigation was, said the President, without foundation in fact.
Sir C. Liang Cheng admitted that the appointment of Chang Chih Tung as the "Tu Pan," or Director-General, of the railway had at first been received with some misgivings on his own part, and considerable opposition on the part of the shareholders. But, he went on to say, as a result of telegrams exchanged between himself on behalf of the Company, the Railway Board, and Chiang Chih Tung, the latter's status had been explained and defined, and he believed that a majority of the shareholders now welcomed the appointment. The Director-General would not interfere in any way with the construction of the line or the management of the Company, but would exercise a general supervision over the three sections of the line. His great influence in all the provinces through which the line would pass would enable him to smooth over any difficulties that might occur when the time came to link up the three sections, and he would in the meantime make it his business to see that the work of construction was pushed forward as expeditiously as possible all along the line.
The above statement, which I have quoted, to the best of my recollection, almost textually, represents, I imagine, the President's official view of the appointment. From certain expressions which he let fall at a later stage of the interview, I gather that he is not altogether pleased with the new arrangement, and that he will probably make it an excuse for relinquishing his post as soon as he conveniently can.
Sir C. Liang Cheng said that it was quite untrue that the Company were in financial difficulties. They had a sum of 2,500,000 taels odd deposited in various banks; they had 700,000 taels' worth of railway materials in their godowns at Wang Sha (the Canton terminus), rails, sleepers, and cars to the value of 800,000 taels on their way out to China, and the passenger traffic on the 25 miles open to Kuantien was bringing in about 14,000 dollars per mensem. He considered the Company still possessed, in cash and material, some 65 per cent, of their original capital of 8,000,000 dollars.
They expected to obtain at least 8,000,000 dollars from their second call on the shares, but he had been assured that 5,000,000 dollars would be sufficient to carry the line (not completed, but open to light traffic) to the Hunan border.
Asked how the collection of the second call of 1 dol. 50 c. per share was progressing, Sir C. Liang Cheng said the money was coming in slowly but satisfactorily. There had been some murmuring because the two years' interest on the first instalment of the shares was not paid out, but deducted from the second; but he said the majority of the smaller shareholders were content with the arrangement, which saved time and money.
The 1 dollar shares now stand at 75 cents, ex dividend, and there was some demand for them.
The President informed me that in about ten days' time the line would be open to passenger traffic as far as Yin Chan Ao, 35 miles from Canton, The embankment will shortly be completed as far as Ying Tak, and the surveyors are expected to reach Shao Kuan (Shao Chou Fu) early in October.
The line was not seriously damaged by the great floods, but in several places in the Ying Tak district new alignments have had to be made and the levels raised.
The Company were experiencing considerable difficulty in the purchase of land, and, as in the case of the Canton-Kowloon line, the expenditure under this head far exceeded the original estimate. The Viceroy's assistance had now been invoked, and he had recently issued a Proclamation warning contumacious land-owners that their land would be expropriated if they refused to accept reasonable terms. I understand the prices offered by the Company range from 60 to 100 taels per mou. The gentry are to assist in assessing values. One month will be given for the owner to make up his mind, and if at the expiry of that period he refuses to sell, the land required will be taken over and the purchase-money deposited with the local officials.
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The scheme for a branch line to Sanui had not been abandoned, said the President. An influential party amongst the shareholders were strongly in favour of it, and they hoped, in view of the good progress the trunk line was making, to obtain the Railway Board's sanction to the undertaking.
With regard to the engagement of a European accountant, Sir Chen-tung Liang said that, while he himself was in favour of appointing Mr. Chard to the post, the engineer-in-chief, Kwang, and some of the other Directors were opposed to the appointment on the ground that Mr. Chard had no experience of railway accounts. I said I thought the Company would have to pay pretty heavily if they required the services of a first-class railway accountant, and it seemed to me that Mr. Chard's experience of China and his knowledge of banking methods gave him exceptional qualifications for the work he would have to do.
The President agreed, and again said that he himself would like to secure Mr. Chard's services. I suggested that Mr. Chard might be willing to accept a short engagement—say, for three or six months, as it were—on probation, when his fitness for the post might be tested.
The President promised to consider this suggestion, and said that in any case he would let me know if the Directors decided to engage a railway accountant.
At the conclusion of our interview, Sir Chen-tang Liang, who had throughout volunteered information and replied to my questions in the most courteous, open manner, handed me an advance copy of a Circular which is to be distributed among the shareholders, containing copies of the correspondence with regard to the appointment of Chang Chih Tung above referred to. A translation of this Circular is being made, and will be forwarded by first opportunity.
I am forwarding a copy of this despatch to the Governor of Hong Kong, and duplicate copies for the Legation under flying seal to His Majesty's Consul-General at Hankow.
I have, &c. (Signed)
H. H. FOX.
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The following account of an interview which I had yesterday afternoon with Sir C. posses- Liang Cheng, President of the Company, will, I venture to think, place you sion of the latest and most authentic information regarding the affairs of the Canton- Hankow Railway :-
The President hegan by informing me that the annual general meeting of share- holders, held on the 27th instant at the Company's Head Office in Canton, had this year The attendance at the meeting had been passed off in the most satisfactory manner. unusually large, and the election of the three new Directors (one-third of the Directorate retire annually in rotation) had proceeded without a hitch. The meeting had been attended by the Provincial Treasurer, Provincial Judge, and two other officials as Representatives of the Viceroy and the Central Government. The rumour that these gentlemen had been appointed a Committee of Investigation was, said the President, without foundation in fact.
Sir C. Liang Cheng admitted that the appointment of Chang Chih Tung as the "Tu Pan," or Director-General, of the railway had at first been received with some misgivings on his own part, and considerable opposition on the part of the shareholders. But, he went on to say, as a result of telegrams exchanged between himself on behalf of the Company, the Railway Board, and Chiang Chih Tung, the latter's status had been explained and defined, and he believed that a majority of the shareholders now welcomed the appointment. The Director-General would not interfere in any way with the con- struction of the line or the management of the Company, but would exercise a general His great influence in all the provinces supervision over the three sections of the line.
through which the line would pass would enable him to smooth over any difficulties that might occur when the time came to link up the three sections, and he would in the meantime make it his business to see that the work of construction was pushed forward as expeditiously as possible all along the line.
The above statement, which I have quoted, to the best of my recollection, almost textually, represents, I imagine, the President's official view of the appointment. From certain expressions which he let fall at later stage of the interview, I gather that he is not altogether pleased with the new arrangement, and that he will probably make it an excuse for relinquishing his post as soon as he conveniently can.
Sir C. Liang Cheng said that it was quite untrue that the Company were in financial difficulties. They had a sum of 2,500,000 taels odd deposited in various banks; they had 700,000 taels' worth of railway materials in their godowns at Wang Sha (the Canton terminus), rails, sleepers, and cars to the value of 800,000 taels on their way out to China, and the passenger traffic on the 25 miles open to Kuantien was bringing in about 14,000 dollars per mensem. He considered the Company still possessed, in cash and material, some 65 per cent, of their original capital of 8,000,000 dollars.
They expected to obtain at least 8,000,000 dollars from their second call on the shares, but he had been assured that 5,000,000 dollars would be sufficient to carry the line (not completed, but open to light traffic) to the Ilunan border.
Asked how the collection of the second call of 1 dol. 50 e. per share was progressing, Sir C. Liang Cheng said the money was coming in slowly but satisfactorily. There had been some murmuring because the two years' interest on the first instalment of the shares was not paid out, but deducted from the second; but he said the majority of the smaller shareholders were content with the arrangement, which saved time and money.
The 1 dollar shares now stand at 75 cents, ex dividend, and there was some demand for them.
The President informed me that in about ten days' time the line would be open to passenger traffic as far as Yin Chan Ao, 35 miles from Canton, The embankment will shortly be completed as far as Ying Tak, and the surveyors are expected to reach Shao Kuan (Shao Chou Fu) early in October.
The line was not seriously damaged by the great floods, but in several places in the Ying Tak district new alignments have had to be made and the levels raised.
The Company were experiencing considerable difficulty in the purchase of land, and, as in the case of the Canton-Kowloon line, the expenditure under this head far exceeded the original estimate. The Viceroy's assistance had now been invoked, and he had recently issued a Proclamation warning contumacious land-owners that their I understand land would be expropriated if they refused to accept reasonable terms.
The gentry the prices offered by the Company range from 60 to 100 taels per mou. are to assist in assessing values. One month will be given for the owner to make up
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his mind, and if at the expiry of that period he refuses to sell, the land required will be taken over and the purchase-money deposited with the local officials.
The scheme for a branch line to Sanui had not been abandoned, said the President. An influential party amongst the shareholders were strongly in favour of it, and they hoped, in view of the good progress the trunk line was making, to obtain the Railway Board's sanction to the undertaking.
With regard to the engagement of a European accountant, Sir Chentung Liang said that, while he himself was in favour of appointing Mr. Chard to the post, the engineer-in-chief, Kwang, and some of the other Directors were opposed to the appointment on the ground that Mr. Chard had no experience of railway accounts. I said I thought the Company would have to pay pretty heavily if they required the services of a first-class railway accountant, and it seemed to me that Mr. Chard's experience of China and his knowledge of banking methods gave him exceptional qualifications for the work he would have to do.
The President agreed, and again said that he himself would like to secure Mr. Chard's services. 1 suggested that Mr. Chard might be willing to accept a short engagement-say, for three or six months, as it were--on probation, when his fitness for the post might be tested.
The President promised to consider this suggestion, and said that in any case he would let me know if the Directors decided to engage a railway accountant.
At the conclusion of our interview, Sir Chentang Liang, who had throughout volunteered information and replied to my questions in the most courteous, open manner, handed me an advance copy of a Circular which is to be distributed among the share- holders, containing copies of the correspondence with regard to the appointment of Chang Chih Tung above referred to. A translation of this Circular is being made, and will be forwarded by first opportunity.
I am forwarding copy of this despatch to the Governor of Hong Kong, and duplicate copies for the Legation under flying seal to His Majesty's Consul-General at Hankow.
I have, &c. (Signed)
H. H. FOX.
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