CO129-360 - Public Offices - 1909 — Page 732

[This Document is the Property of His Britannic Majesty's Government.]

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J'ai à vous entretenir aujourd'hui d'une démarche qui vient d'être faite auprès de M. de Biedermaun au nom de la Régie Générale des Chemins de Fer. Il vient de m'informer que sa Société était sur le point de signer avec la maison Pauling un contrat en vertu duquel toutes les affaires de construction de chemins de fer en Chine et de fournitures de matériel que l'un des deux pourrait obtenir, et notamment l'affaire d'Hankéou-Canton, seraient divisées en trois parts: 40 pour cent devant revenir à la maison Pauling, 40 pour cent à la Régie Générale des Chemins de Fer, et 20 pour cent à la Société d'Études Belge, représentée par M. Jadot.

M. de Biedermann me dit qu'il me donnera communication de ce contrat aussitôt qu'il sera signé.

Mais, en attendant, il me demande de télégraphier à M. Casenave, pour que celui- ci insiste auprès de M. Bland pour qu'il retire la première proposition qui avait été faite à la Chine, celle d'un contrat analogue à celui du Kowloon-Canton, pour demander uniquement un contrat de construction comme condition de l'emprunt.

J'ai répondu à M. de Biedermann que je ne pourrais le faire qu'à la condition qu'une entente de ce genre existat entre la British and Chinese Corporation et la maison Pauling; qu'en effet nous nous considérions comme liés par nos Accords précédents avec la British and Chinese Corporation, et liés avec elle seule, et que par conséquent nous ne pouvions rien faire, pas même télégraphier à M. Casenave dans ce seus, sans être certains d'être en parfaite conformité de vues avec la British and Chinese Corporation.

Je viens donc vous demander quel est votre sentiment à ce sujet. Si vous ne jugiez pas comme dangereux pour la négociation avec la Chine de ne plus présenter que cette seule combinaison, cela aurait peut-être l'avantage d'aplanir immédiatement les difficultés qui se sont élevées au sujet de l'interprétation de nos Accords.

En effet, les constructeurs étant d'accord eux-mêmes pour partager les avantages industriels, il ne nous resterait plus pour rester dans les termes de l'entente qu'à nous partager l'opération financière.

Votre bien dévoué, (Signé) ST. SIMON.

C.O. 11287

CHINA RAILWAYS.

CONFIDENTIAL.

PEOP Reg | APR OS

[February 22.] C.O.

11287 SECTION 2.

[7109]

No. 1.

Peep | APR 09

(No. 57.) Sir,

Sir J. Jordan to Sir Edward Grey.~(Received February 22.)

Peking, February 3, 1909,

IN continuation of my despatch No. 534 of the 25th November, I have the honour to inclose, for your information, copies of further correspondence referring to the affairs of the Shanghae-Ningpo Railway.*

There are three matters of importance dealt with in this correspondence. The first is stated in my note of the 3rd December to Prince Ching, in which I complained strongly of certain contemptuous treatment of the Managing Director, Taotai Shih Chao-tseng, and the Chief Engineer, Mr. Foord, by the Kiangsu Railway Bureau, and urged that obstruction of this nature was no longer tolerable, and should be brought to an end by the telegraphic instructions of the Central Government. In the reply of the Board of Communications, communicated through Mr. Bland, an explanation of the contemptuous treatment was offered, and I was informed that a telegram of reproof had been sent to the Bureau.

On the 20th January Mr. Bland received a telegram from the British and Chinese Corporation's agents at Shanghae stating that the Managing Director had tendered his resignation, owing to the impossibility of working with the President of the Chekiang Railway Bureau, who openly repudiated the Loan Agreement and the authority of the Board of Communier tions. Mr. Bland addressed a strong letter to his Excellency Liang Shih-yi on this matter, but has so far had no reply. The delay is probably due to difficulties in which the principal officials of this Board have been placed of late by violent denunciations of Censors, which are under the consideration of the Regent and Grand Council, and which, it is currently reported, may entail the dismissal or removal of the President.

The third and more serious question concerns the treatment of the loan funds by the Board of Communications. It appears that large sums have been requisitioned on what seem to be inadequate certificates, and a sum of 500,0001. was transferred suddenly in January from the Railway Loan funds in London to the credit of the railway's account and to the order of the Board of Communications in Shanghae. It is alleged that this remittance was made to take advantage of the rate of exchange, but it is well known that Chinese officials use official deposits whenever they can for private purposes and that the Board of Communications have a bank of their own, called "The Chiao- tung Bank," which could facilitate transactions of this nature. It is through this bank that the requisitions pass. When the attention of the Manager of the Hong Kong and Shanghae Banking Corporation at Shanghae, who is also a Joint Manager of the British and Chinese Corporation, was drawn by Mr. Bland to these facts, he replied regretting his inability to withhold the loan funds, counsel having laid down the opinion that if the Mr. Bland has rejoined, pointing out that, requisitions were in order they must be met. in his opinion, the Corporation's Joint Managers, acting together, can properly insist on certificates more closely fulfilling the intentions of the Loan Agreement, and suggesting a course of action which has my approval. Stated shortly, this is a joint representation to the Board of Communications by himself and Mr. E. G. Hillier that the payments into the Chiao-t'ung Bank constitute in the circumstances a breach of the Loan Agree- ment, and, if this joint representation fails to extract satisfactory assurances, further action at the Wai-wu Pu by myself.

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

* Not printed.

[2150 y-2]