CO129-362 - Public Offices - 1909 — Page 240

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[This Document is the Froperty of His Britannic Majesty's Government

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CHINA RAILWAYS.

CONFIDENTIAL.

[July 24.]

SECTION 2.

[27965]

No. 1.

Sir Edward Grey to Mr. Rumbold.

(No. 123.) Sir,

Foreign Office, July 24, 1909. The Japanese Ambassador spoke to me on the 20th instant about a telegram in "The Times" of that date from Tôkiô, to the effect that the Japanese Government could not wait much longer before settling affairs with China,

This, he said, clearly could not relate to the Fakumen Railway, as it was for the Chinese and not for the Japanese to raise this question. He thought, therefore, the telegram must refer to the Antung-Mukden Railway. Some 4 years ago, Count Komura had agreed with the Chinese that the Japanese should transform this temporary line into a permanent one. The South Manchurian Railway people were anxious to do this, but they found that the curves on the present route would make it necessary to alter the route, in order to make it possible to construct a satisfactory permanent railway with a standard gauge. The Chinese Minister, however, was unwilling to take any responsibility for alterations, and the line could not be rebuilt, because he would not agree to any diversion of the route or to the standard gauge. Time was passing, and it was urgent that work should be begun on the line.

We had some general conversation on railway questions in Manchuria, in the course of which the Ambassador made it clear that the Japanese would not object to any

lines which would feed the South Manchurian Railway, but were opposed to all projects which would tap the main line at such places at Tsitshihar and divert traffic from the South Manchurian Railway.

I said that if the Chinese were businesslike they would discuss with the Japanese the whole question of railways in Manchuria. There must be need for further railway development in Manchuria, and I thought it ought to be possible for the Chinese to make some arrangement with the Japanese.

The Ambassador told me that Messrs. Pauling and Company were trying to make some arrangement with a Japanese syndicate as to the spheres in which they were to operate in China, but at the same time they were prompting the Chinese to put forward projects which were prejudicial to the South Manchurian Railway.

I remarked that the Chinese Foreign Office was most unbusinesslike just now. If the Chinese were sensible, they would decide what railways they needed and what firms they would employ, and they would make their own terms. They could do this perfectly well without any diplomatic interference, if they would but deal fairly with the firms they employed, and offer suitable guarantees that the money raised for railways would be honestly spent upon railway construction.

The Ambassador said that he thought the best plan for the Chinese would be to build their own railways, employing foreign engineers for the purpose, and giving the foreigners who leant the money some position, through an accountant or otherwise, which would afford a guarantee that the money would be honestly spent.

am, &c.

[2336 aa-2]

E. GREY.

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