CO129-362 - Public Offices - 1909 — Page 601

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

(REGO 12 OCT 09

[B]

CHINA RAILWAYS.

CONFIDENTIAL.

[35075]

No. 1.

599

[September 20.}

SECTION 1.

Mr. Rumbold to Sir Edward Grey (Received September 20.)

(No. 255. Confidential.) Sir,

Tokyo, August 31, 1909. IN my immediately preceding despatch I had the honour to report that, by the terms of the agreement practically concluded at Peking between the Chinese Govern- ment and the Japanese Minister, settling various Manchurian questions, the Chinese Government were to abandon the Hsinmintun-Fakumen Railway project.

Mr. Ishii said to-day that the question of reviving this project would probably never arise, as the importance of the Hsinmintun-Fakumen line would be cancelled by the construction of the Cheng-Chow-Taonanfu line, with an extension to Tsitsihar. The latter line, though in some parts 100 miles from the South Manchurian Railway, would be a far greater competitor to that railway than the line between Hsiamintun and Fakumen. But in view of the British interests involved, the Vice-Minister for Foreign Affairs said that Japan would be ready to come to an agreement with China as to the construction of the line in question. Mr. Kato's language to you accurately expressed the views of the Japanese Government on this matter.

Having regard to the statement made above, regarding the serious nature of the competition which the Cheng-Chow-Tsitsihar Railway would set up as regards the South Manchurian Railway, it is difficult to see why the Japanese Government have made a point of the Chinese abandoning the less competitive Hsinmintun--Fakumen

line.

Mr. Ishii went on to say that he agreed with the Japanese Minister in Peking in thinking that it would be best to await the final conclusion of the Manchurian negotiations before approaching the Chinese Government on the proposed Cheng- Chow-Taonanfu Railway project. His Excellency said that he considered it was China's duty to take the initiative in this question, but did not commit himself as to what Japan's action would be supposing that, as Sir J. Jordan feared, China could not be induced to take the initiative.

Mr. Ishii added that the Japanese Minister at Peking had been instructed to consult with His Majesty's Minister on the subject, after the signature of the Manchurian agreement.

I have forwarded a copy of this despatch to Sir John Jordan.

[2413 --1]

I have, &c.

HORACE RUMBOLD.