145 C.0.
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2
Corporation and the British and Chinese Corporation cannot be cancelled or altered.
(f) Both Agreements shall not come into force before fulfilment of the conditions hereafter specified under No. 3.
3. After conclusion of both Agreements, M. Cordes shall immediately be instructed to reopen negotiations for a modification of the Preliminary Agreement for the Canton-Hankow Railway loan, if necessary, under assistance of the British, French, and German Legations in Peking, so that the provisions concerning the control over the employment of loan funds may be improved to Canton-Kowloon terms as a minimum.
The British and French groups will then be free to enter into the Canton-Hankow Agreement (Hunan and flupeh sections), provided always that the Hankow-Chengtu loan (Hupeh section) will be concluded simultaneously. The Chief Engineer for the former line shall then be appointed by the Britisli group, but for the Hupeh section of the Hankow-Chengtu line the power of appointing the Chief Engineer rests under any circumstances with the German Syndicate.
4. All efforts must be made by the three groups to the effect that the inter- nationalization of all loans coming under both Agreements be insured.
If necessary, it can be granted that the expenses for stamp duty and publicity are shared in common by the three groups.
The time of notice of termination to be given for both Agreements should be twelve months instead of six months, and both Agreements should not terminate sooner than the 31st December, 1911.
We hope you will agree to continue the negotiations on these lines, and we shall be prepared to meet you and the other English and French friends in Brussels or Paris during the week commencing the 29th instant, but not before the 1st proximo.
We remain, &c.
(Deutsch-Asiatische Bank),
(Signed) ERICH AND REHDERS.
[This Document is the Property of His Britannic Majesty's Government.] 13950
CHINA RAILWAYS.
CONFIDENTIAL.
[10459]
No. 1.
Foreign Office to Chinese Central Railways.
RECE [March 266 24 APR 09
SECTION 1.
Sir,
Foreign Office, March 26, 1909, WITH reference to the letter from this Department of the 17th instant respecting the proposed railway from Pukou to Sinyang, I am directed by Sir Edward Grey to inform you that a despatch has been received from Sir J. Jordan, His Majesty's Minister at Peking, which confirms the view that the present moment is an unfavour- able one for approaching the Chinese authorities in the matter. Sir J. Jordan states that, pending the completion of the Canton-Hankow Railway negotiations, which are now proceeding, there is no hope of obtaining a consideration of the Pakou-Sinyang project.
It appears that the Chinese authorities are most reluctant to allow the materializa- tion of any railway scheme involving definite control on the part of the concession- naires, and Sir J. Jordan is of opinion that no pressure on the part of His Majesty's Legation would secure the fulfilment of the obligations entered into by the Prelimi- nary Agreement of 1898. While Chinese credit stands so high in Europe it can scarcely be expected that the Chinese Government should resist the strong public outcry in China against foreign control of railways in any shape or form, and their present intention seems to be only to entertain loans for railway construction on a purely financial basis. It is indeed admitted theoretically at Peking that this cannot be done consistently with the maintenance of existing engagements, which were, however, entered into many years ago under totally different conditions; but the difficulty of obtaining in practice the fulfilment of these engagements is one which, Sir J. Jordan points out, can hardly be fully appreciated at a distance.
Sir J. Jordan believes that compensation may furnish an ultimate solution of the question, though he adds that at present there appears to be no inclination on the part He of the Chinese to follow the precedent of the Peking Syndicate's case in Shansi. is inclined to think that the compromise suggested by your Company in regard to the Hankow-Szechuan line is more likely to commend itself to the Chinese Government.
am, &c. (Signed) F. A. CAMPBELL.
P.S.-I am to take the opportunity of acknowledging the receipt of your letter of the 23rd March, and to inform you that a copy of it will at once be forwarded to His Majesty's Minister at Peking.
F. A. C.
[2193 cc-i]
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