CO129-356 - Governor Sir Lugard - 1909 [4-6] — Page 154

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he also takes over the work of the present Chief Resident

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Engineer but after the first 3 years he might be replaced by one

on a salary of £1,000 to 1,200. Free quarters or an allowance

in lieu, travelling expenses to cover actual outlay, and free

passages each way would be given.

10.

NB. Article 6 of the Loan Agreement should be noted.

The British and Chinese Corporation I understand intend to

insist on its fulfilment, but it must be remembered that the

negotiations of this Government with the Chinese Government are

outside the Loan Agreement; that the latter may be cancelled by

repayment of the loan in 10 years, and that there is no necessity

for both British Officials (e.g. the Chief Accountant) to be

included in the Board.

There are some further points for negotiation e.g.,

the question of Lekin (transit dues). The power to impose these

must be restricted or the Railway will carry no freights. It is

however the subject of negotiation in regard to the Shanghai

Railway and I do not anticipate much trouble. If imposed at all

it should be collected with Import and Export dues. (b). The

Possibility of China imposing dues on sea-borne Freight in

native boats between Hongkong and Canton to discourage the

Railway. (c). Management of Telegraphs. (d). Special Rates

and exemptions.

16th April, 09.

CJ Dugard.