C.O.
This Document is the Property of His Britannic Majesty's Governmen2 49101
CHINA RAILWAYS.
[December 28.12 AL 19
CONFIDENTIAL.
[45129]
No. 1.
SECTION 1.
(No. 503.) Sir,
Sir J. Jordan to Sir Edward Grey.Received December 28.)
Peking, November 7, 1908.
I HAVE the honour to acknowledge the receipt of your despatch No. 428 of the 8th September last, in which you forwarded to me a note of a conversation which Mr. Langley had held with the French Chargé d'Affaires on the subject of railway construction in China, and a copy of the Memorandum which you had transmitted to the French Embassy in reply.
You desired me to furnish you with information as to the nature of the appoint- ment which had been conferred upon Chang Chih-tung in connection with the Canton - Hankow Railway, and to the alleged change of attitude on the part of that statesman towards French participation in the loan to be raised for its construction.
My despatch No. 333 of the 21st July last, and the subsequent correspondence noted in the margin, will already have placed you in full possession of all the facts connected with this appointment, and of the steps which the Grand Secretary has taken towards giving effect to the task imposed upon him by the Throne.
An Imperial Decree, issued on the 28th October last, copy of which is inclosed, reiterates in a more direct and positive form the previous instructions, and shows clearly that the Central Government is earnestly determined to take the work out of the hands of the provincial authorities and carry it to completion as an Imperial undertaking.
Chang Chih-tung continues to maintain a telegraphic correspondence with the Wuchang authorities, and the inclosed despatch from His Majesty's Consul-General at Hlankow, indicates the nature of the difficulties which he is experiencing in overcoming the provincial opposition to foreign loans, and in asserting the principle of State railway construction. The question will now be subjected to a practical test, as Mr. Bland, for whose return Chang Chih-tung has been waiting, arrived here a day or two ago, and is presumably prepared to enter into negotiations for a loan.
As regards the changed attitude of Chang Chih-tung towards French participation, I had the honour, in my telegram No. 45 of the 19th February last, to report the modification which, according to the French Minister, had taken place in his Excelleney's views, and since then I have had no indication of his intentions beyond that contained in his telegram to Mr. Fraser of the 4th October, which formed a sub-inclosure in my despatch No. 457 of the 14th October. In that he stated that China could only recognize her obligation to the British lender, and invoked Mr. Fraser's assistance in dealing with the interference of other Powers. I do not, however, attach any very serious importance to this last declaration, aud am inclined to think that China will in the end accept Anglo-French financial assistance for the Canton-Haukow Railway, just as she has done for the redemption of the Peking Hankow line. But it would be premature, at the present stage, for me to volunteer any communication to the Chinese Government on the subject, and any such step is, I venture to submit, wholly unnecessary. The Chinese know perfectly well the nature of our engagements to the French, and the whole past history of the negotiations has shown them that, without French participation, they can conclude no loan of the kind with us. The French Legation and the agent of the Banque de l'Indo-Chine are fully aware that our engagements to them will be scrupulously observed, and that the Chinese must accept them as partners with us in the undertaking. But, in order to remove any possibility of doubt, I shall, as soon as the negotiations are reopened, take an opportunity of again reminding the Chinese Government that French participation is an indispensable condition of the loan.
As reported in my despatch No. 457, Confidential, of the 14th October last, M. Casenave showed some disposition to discuss the question independently with the Viceroy at Wuchang, but I hope that the French Minister will continue to adhere to the view (see my telegram No. 45 of the 19th February) that the leading part in the negotiations should be assigned to the agent of the British and Chinese Corporation. It is obviously desirable that the loan should be accompanied by some provisions governing construction, and the Agreement of the 9th September, 1905, which Chang Chih-tung professes his desire to observe, gives the British negotiator a lever for securing conditions which his French colleague is not in a position to claim.
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