[This Document is the Property of His Britannic Majesty's Government.]
[B]
AFFAIRS OF CHINA.
CONFIDENTIAL.
[9425]
No. 1.
C 10672
[March 14.]
SECTION 1.
Papers communicated to Foreign Office by Mr. Addis, March 14.
(1.)
Telegram received from Messrs. Morgan, Grenfell, and Co., London, March 13, 1911.
FOLLOWING telegram signed by Straight, Hillier, Cordes, and Casenave :---- "As result conference with China of the 9th March, we believe Board of Finance prepared accept following terms final agreement :---
"Imperial Chinese Government 5 per Cent. Sinking Fund Gold Loan 10,000,0001, for currency reform and Manchurian industries. Secured by first charge Manchurian tobacco and spirits taxes, 3,000,000 taels; Manchurian production tax, 700,000 taels: Manchurian consumption tax, 800,000 taels; additional surtax on salt, eighteen provinces, 2,500,000 taels; totalling 5,000,000 taels per annum. Foregoing free from prior charges if insufficient; Chinese Government will supply balance, first from Manchuria then from other sources. In case of default above revenues to be administered by maritime customs.
"Immediately upon signature agreement Board of Finance to hand banks currency reform programme approved by Imperial edict of May 1910, together with statement proposed expenditures thereunder, and proposed expenditures for Manchuria.
"Banks to be given six months within which examine above.
"If found to be satisfactory banks to notify Board of Finance and issue loan to public as soon as possible after such notification.
"Price bonds to Chinese Government 95.
"In the event of funds being urgently required for Manchurian expenditures, banks agreed, after execution of loan agreement, to advance up to 1,000,000!, on receipt of statement satisfactory to them regarding nature and amount of expenditures proposed.
"When currency reform programme with statement of expenditures thereunder and statement of Manchurian expenditures has been accepted, and prior to issue of loan banks agreed, if necessary, make further advances up to 1,000,0001. for preliminary expenses currency reform.
All above advances with accrued interest 6 per cent. per annum to be deducted from first proceeds of loan.
** Proceeds of loan after deduction advances to be deposited with banks in currency reform and Manchurian development accounts in proportions fixed respectively by statement of expenditures above referred to.
"Payments to these accounts to be made in instalments and on dates conforming to conditions allowed subscribers to loan. Transfer of loan funds to China to be made through banks conformably to requirements specified in statement expenditures, but in amounts not exceeding maximum of blank in any one week.
[Note.-China desire fix maximum 1,000,000/.; we have suggested 200,000. Requirements governing transfer will in any case be fixed by statement of expenditures which must be accepted by you before loan issued. Please instruct as to maximum weekly transfer.]
"Transfer to Shanghai will be made in equal amounts from four banks, and will be withdrawn in equal amounts from banks in Shanghai by Chinese Government orders. Such orders to be accompanied by certificates, form of which shall be stipulated respectively in the statement of expenditures for currency reform and statement of expenditures for Manchurian industries. Funds withdrawn to be deposited with Chinese bank designated by Board of Finance.
[1918 --1]
557
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