[This Document is the Property of His Britannic Majesty's Government.]
CHINA RAILWAYS.
CONFIDENTIAL.
30023. [August 25.]
JRES 3 OCT TO SECTION
[31005]
No. 1.
(No. 269.) Sir,
Mr. Max Müller to Sir Edward Grey.-(Received August 25.)
IN Sir John Jordan's despatch No. 316 of the 4th September last, it was reported
Peking, August 6, 1910. that the system of exemption certificates on the Shanghai-Nanking Railway was working satisfactorily, and in his despatch No. 432 of the 25th November it was stated that, as regards the passenger traffic, the line was proving a success. Exemption certificates, however, only cover foreign goods conveyed from one open port to another, and there still remains the question of the taxation of native goods carried on the railway, which continues to be unsatisfactory.
In order to meet the complaint that the railway was placed at a disadvantage in competition with water transport, owing to the possibility of evading a portion of the i-kin charges on the latter route, it will be remembered that the Board of Communications introduced a new li-kin tariff, the effect of which, they assured His Majesty's Minister, would be to tax rail-borne goods more lightly than those carried by water, and that the spirit of the loan agreement would thus be fulfilled.
Sir John Jordan, as reported in his despatch No. 265, suggested that the best way to avoid discrimination would be to make the li-kin passes interchangeable for both routes, but that failing this, he was prepared to agree to any system that would secure effective equality of treatment, and in his note to the Wai-wu Pu of the 14th May he accepted the new tariff provisionally, reserving the right to renew his request for interchangeable li-kin passes, should the system prove unsatisfactory in practice.
The system has now been tried for more than a year, and that the results have been disappointing is shown by a letter which I have received from Mr. Mayers, the Peking agent of the British and Chinese Corporation. It appears that during 1909 the passenger receipts amounted to over 1,500,000 dollars, while the goods traffic showed a return of under 190,000 dollars, and the railway's inability to compete with water-borne traffic is attributed entirely to the fact that while the full l-kin is exacted on rail-borne goods, merchants using the waterways are able to obtain considerable reductions in the tariff dues by bribing the li-kia officials. Mr. Mayers concludes by suggesting that the Chinese Government be asked once more to comply with Sir John Jordan's original request, and make all passes covering goods in transit, whether by rail or water, identic and interchangeable.
I have accordingly, in a note copy of which I have the honour to enclose herewith, again urged the Wai-wu Pa to adopt this method of preventing unfair discrimination against the railway.
Your Highness,
I have, &c.
(In the absence of His Majesty's Chargé d'Affaires), ERNEST SCOTT.
Enclosure in No. 1.
Mr. Max Müller to Prince Ch'ing.
Peking, August
1910.
ON the 14th May, 1909, His Majesty's Minister had the honour to address a note to your Highness on the subject of li-kin on the Shanghai-Nanking Railway. In view of the express declaration conveyed in your Highness's memorandum of the 5th April, 1909, to the effect that the land-route dues were less than those on the water route, Sir John Jordan stated that he had no objection to a trial for some months of the proposed new regulations.
1 am now informed by the British and Chinese Corporation that in the year 1909 the coaching traffic on the Shanghai-Nanking Railway produced over 1,500,000 dollars, while the goods traffic showed a return of under 190,000 dollars,
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