424
C.O.
17899
This Document is the Property of His Britannic Majesty's Government. }'
CILINA RAILWAYS
CONFIDENTIAL.
[17654]
No. 1.
Pack
27 MAY 09
[May 10.]
SECTION 2.
Sir J. Jordan to Sir Edward Grey.-(Received May 10.)
(No. 160. Confidential.) Sir,
Peking, April 22, 1969. REFERRING to my despatch No. 146 of the 9th instant, I have the honour to inclose for your information copies of further correspondence relating to the matter of Hankow-Canton Railway loan
After our protest of the 4th April was sent to the Wai-wu Pu, I advised Mr. E. Q. Hillier to see his Excellency Liang Tun-yen privately and suggest, as from himself, that the Chinese Government, rather than risk a diplomatic conflict with us, should modify the Preliminary Agreement with the German Bank so as to admit all parties, by giving the Chief Engineer authority to sign certifientes of expenditure.
Mr. Hillier bad an interview with Liang Tun-yon on the 6th April, and began by saying that, while the position assigned to him in the recent negotiations was that of a bystander, he viewed with much concern the situation that had been created, not only between the Chinese Government and British and French financiers, whose good- will was of first importance to China financially, but also between the Chinese Government and Great Britain, whose good-will was politically of even greater consequence. He showed that this unfortunate situation could be ended at once by the simple concession on the part of the Chinese Government of the Chief Engineer's signature on requisitions, which was necessary to satisfy the investing public that the irregularities which had taken place on the Shanghac-Ningpo Railway should not recur on the Innkow-Canton Railway.
Liang agreed that the state of affairs on the Shanghae-Ningpo Railway was a scandal, but said that the Engineer's signature on requisitions was an impossibility. The Chinese Government did not dare to consent to it, in the present state of Chinese public opinion. It would, in fact, give the Engineer complete control over the loan funds, and if he happened to be an unreasonable person the Chinese Government would be at his mercy. According to Liang, the object which the Grand Secretary Chiang had in view was to obtain better than Tien-tsin-Pukow terms, but this proving impracticable, he had agreed to accept these as they stood, and so was in a position to reply to his critics that he had at least done no worse than his predecessors. Were ho now to accept worse terms than the Tien-tsin-Pukow there would be an outery throughout the country, which neither the Grand Secretary nor the Government was strong enough to face. "I understand," he said, "that what you want is some guarantee that will satisfy the public that there will not be a repetition of the state of affairs ou the Shanghac-Ningpo Railway"; and Mr. Hillier replying in the affirmative, he concluded by saying that he would consult with his colleagues and seo what could be done,
On the 9th April, Liang sent a message to Mr. Ilillier to the effect that, while the Engineer's signature to requisitions was out of the question, the Chinese Government would be glad to have a clause inserted in the Loan Agreement preventing loan funds from passing into the hands of the provincial gentry, and vesting the control absolutely in the Government; and that this suggestion might afford a possible solution to the difficulty.
Tho Wai-wu Pu sent me on the 11th April, as an answer to my note of the 4th April, a long explanation and counter-complaint from the Grand Secretary Chang, in which he refused to admit the justice of our protest, and insisted that the British and Chinese Corporation having declined to undertake the loan on the terms of the despatch of September 1905 there was no want of regard shown to us in settling with the German Bank.
In the meantime, as I was informed by your telegram No. 74 of the 10th April, Mr. Hillier was instructed from London to take over the negotiations from Mr. Bland, and ho entered into relations at once with Mr. Cordes. The latter, on the 12th April, expressed a hope that our group would be able to come in on Tien-tsin-Pukow terms. Mr. Hillier told him that this was not possible, but that he hoped by their joint efforts
[2204 k-2]
B
e
No comments yet.
Private notes are available after approval.