CO129-361 - Public Offices - 1909 — Page 467

C.O. 19075

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

[B]

CHINA RAILWAYS,

Ree? & JUN 09

[May 17.]

455

SECTION 1.

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CONFIDENTIAL.

[18440]

(No. 174.)

Sir,

No. 1.

Count de Salis to Sir Edward Grey.-(Received May 17.)

Berlin, May 15, 1909.

I HAVE the honour to report that Mr. Addis, representing the British and Chinese Corporation, arrived here on Thursday the 13th, to resume negotiations with the French and German groups with regard to an arrangement in respect of the Hankow-Canton Railway, and the Hankow-Chengtu (Szechuen) Railway.

In the course of the following day the Agreement, of which I have the honour to inclose a copy," was drawn up by the three groups and signed forthwith by the English and Germans. As you will observe, the Agreement provides for the issue of a loan of 5,500,000l. which, as well as all orders for materials, is to be equally divided between the three groups. The chief engineer of the Hankow-Canton Railway is to be appointed by the British and Chinese Corporation, and the chief engineer of the first (Hupei) section of the Hankow-Szechuen Railway by the German group. Some divergence of views seems to have existed as to the definition of this section, which is declared in the Agreement to be about 800 kilometres in length, and therefore does not merely consist of a direct line between Hankow and Ichang, but also a branch or loop to Siang-yang. At the last moment the French group refused to sign the Agreement, unless there should be reserved to them a section of the extension from Ichang to Chengtu of the same length as that of the Hupei section reserved to the Germans, i.e., 800 kilom., even if the remaining section, the final one, left to the English, were far inferior to that extent.

An Agreement was ultimately arrived at, of which I have the honour to inclose a copy, providing that 800 kilom. were to be reserved to the French if a still further extension of the line should admit of a similar extent falling to the English. By a letter dated the 15th May (copy inclosed), the Deutsch-Asiatische Bank agree not to offer any objection to this arrangement.

It is further provided that a general Agreement is to be entered into between the three groups for equal participation in all future railway loans in China, also that a general Agreement is to be concluded between the Hong Kong and Shanghae Banking Corporation, the Deutsch-Asiatische Bank, and the Banque de l'Indo Chine, for equal participation in all future Chinese Government financial loans.

I have, &c. (Signed)

J. DE SALIS.

[2261r-1]

* Not printed.

+ Printed in Mr. Addis letter of May 17, 1909.

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