CO129-383 - Public Offices - 1911 — Page 336

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This Durande the Property of His, annic Majesty's Government.]

C

16339

Res 18 MAY IT

CHINA RAILWAYS.

[April 25.]

SECTION 1.

CONFIDENTIAL.

[15383]

No. 1.

Dear Sir Francis,

Mr. Addis to Foreign Office.~(Received April 25.)

Hong Kong and Shanghai Banking Corporation,

31, Lombard Street, London,

April 24, 1911.

1 THANK you for your letter of the 21st instant informing me that even if the groups were to surrender in favour of the Chinese the proposed deposit of half the Hukuang loan funds with the native banks the control of expenditure would, in the opinion of Sir John Jordan, nevertheless he fully maintained, and that it is probable the Secretary of State would adopt Sir John Jordan's view on this point.

It is understood that Sir John Jordan's opinion is shared by his French, German, and American colleagues, as well as by the representatives of the groups in Peking.

In face of the united recommendation of their respective Ministers, the groups feel that they are no longer justified in pressing their own view to the contrary, which, however, remains unaltered.

They have, accordingly, authorised their representatives in Peking to agree to deposit with Chinese Government banks one-quarter of the Hukuang loan proceeds on condition that the amount is credited to a special construction account and applied to railway expenditure in China before any transfer of loan proceeds held in London is made for that purpose.

In taking this step, contrary to their own opinion, the groups feel they may rely upon their respective Governments to supply, in case of need, such diplomatic pressure necessary to counteract the loss of control involved by this concession made in deference to the opinion of their Ministers.

as

may

be

1 enclose copy of the telegram to Peking embodying these instructions, and trust that its terms will meet with your approval. Identical copies are being submitted by the other three groups to their respective Governments.

Yours truly,

C. S. ADDIS.

Enclosure in No. 1.

(Telegraphic.)

Mr. Addis to Mr. Hillier.

Paris, April 22, 1911. FOLLOWING from four groups. Although not convinced, four groups do not feel justified in resisting strong and unanimous recommendation of four Ministers. You are, therefore, authorised agree deposit with Chinese Government banks to the extent of one-quarter proceeds Hukuang loan on condition that amount credited to special construction account and applied to expenditure in China prior to any further transfer of funds from Europe for the purpose. In taking this step contrary to their opinion, groups are relying upon four Ministers supply, in case of need, such diplomatic prossure as may be necessary to counteract loss of control involved by this concession made in deference to opinion of Ministers.

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