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demand is put forward by the English groups which abandons the basis previously accepted, a demand by which the English groups claim a construction-line larger than the one to which the English Government had given its consent just a short time previously.
This inconsistency must cause on this side a feeling of uncertainty whether the endeavours on the English part to complete the pending business are serious and take You know that the agreement due consideration for the interests of the other allies. renewed in Berlin in May 1909 provides a mutual promotion of the undertakings in
China.
Germany wishes to adhere to the agreement with America, reached with the approval of England, and must expect the same of its English allies. A proposition entirely in opposition with this agreement should not have been made in England without your groups being willing to make concessions with regard to the Hankow- Cantou line. So far I have not heard that England is inclined to make such concessions.
I should like to hear from you what measures England will now undertake in order to realise the rights which our syndicates have acquired in the contract prepared with China about the Honan line of the Hankow-Canton Railway and the Hupeh line of the Hankow-Szechuan Railway.
The responsibility for the delay of this matter is, indeed, not attributable to the German group nor to the German Government.
Believe me, &c.
FR. URBIG.
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secured for America, together with an equal share of all the advantages accruing from finance and the supply of materials.
If, as I hope, you agree with me in considering this a reasonable proposition, then I hope you will join us (and the French if they agree) in pressing its acceptance on the Americans.
The above, at any rate, is a clear and frank statement of our position, which will, I trust, serve to dissipate any breath of suspicion that the efforts made by the English group to bring these protracted negotiations to a harmonious conclusion have been, or are, one whit less sincere or less earnest than your own.
Believe me, &c.
C. S. ADDIS.
Enclosure 2 in No. 1.
Mr. C. S. Addis to Herr Urbig.
Dear Mr. Urbig,
January 19, 1910.
IN reply to your letter of the 17th January, the position of the English group in the Hukuang negotiations is as follows:---
On the 8th November the Americans proposed the following division of the engineering sections in the Szechuan line:----
Germans Americans French English
Kilom.
606
800
500
500
This proposition was accepted by the English group on the following day, and by the Germans, so we were informed, a few days later.
The French reply was delayed until the 15th November, when M. Simon wrote that the American proposal was absolutely unacceptable, and that the French would not under any circunstances agree to a less fraction of the line than the Germans and Americans.
Thereupon, on the 21st December, we wrote to the French that if they would agree to the division of the Szechuan line into four equal engineering sections (German, American, French, and English) of 600 kilom. each, we would make one more effort to induce the Americans to accept the 200 kilom., as arranged with the Germans, plus 100 kilom. out of the deferred portion of the line,
To this proposal, in which you will observe the Germans are not asked to give up any more than they have already ceded, the French have not yet replied.
I do not understand that the alternative division, which is only put forward on account of the absolute refusal of the French to agree to the American terms, would cancel the agreement already reached between the Germans and Americans. As we understand that transaction, the Germans having ceded the 200 kilom. required by the American proposal of the 8th November, have since entered into a subsequent arrangement with the Americans with regard to the status of the engineers on their respective sections. From our point of view this is a concern of these two groups with which we have no desire to interfere.
It is true, however, that while the German position is maintained intact, the proposed division into four equal sections would involve a small sacrifice on the part of America. On the other hand, the internationalisation of the whole loan is
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