CO129-368 - Acting Governor May - 1910 [8-9] — Page 311

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(To accompany Enclosure 3.)

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August 2nd.,

1910.

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In a Note from the Wai Tu Pu dated March

19, 1910, Mr. MaxMuller was informed that Taotai Wei Han had

been appointed to meet the representatives of the Hongkong

Government and negotiate with them an arrangement for the

Joint Working of the British and Chinese Sections of the

Canton-Kowloon Railway.

Negotiations have consequently been

proceeding in Hongkong and a Draft Working Agreement has been

drawn up, a copy of which has, I understand, been forwarded

by Mr. Wei Han to the Board of Communications. Matters have,

however, reached a deadlock owing to Thotai Wei Han having

been instructed that he must only negotiate on the lines of

separate management, while the Government of Hongkong is not

prepared to negotiate in such a basis.

The Government of Hongkong point out that

the objection of the Chinese Government to joint management is

not well founded, for Great Britain and China will have equal

representation on the Board of Control of the Rai-lway, while

any point on which votes are equally divided must, according to

the Draft Working Agreement, be referred to the two Governments

for settlement.

It is estimated that by adopting the propos) of the Hongkong Government for joint management the Chinese section will save $100,000 per annum on its share of the Working Expenses. Moreover the uniformity of procedure secured by joint management must lead to greater efficiency, while on the other hand separate management may be expected to arrest the expansion of trade to the detriment of the general prosperity of the country through which the line runs.

MaxMuller has the honour to request

that