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defiance of its treaty obligations by China will bring about, and the following banks therefore respectfully beg that you will transmit this communication by cable to the diplomatic body in Peking, at the same time urging them to make such representations to the Chinese Government as will bring about protection for the large interests involved.
Sir,
We have, &c.
Chartered BANK OF INDIA, &c.
YOKOHAMA SPECIE BANK.
BANQUE DE L'INDO-CHINE.
INTERNATIONAL BANKING CORPORATION.
BANQUE SINO-BELGE.
NETHERLANDS TRADING SOCIETY.
BANK OF TAIWAN,
HONG KONG AND SHANGHAI BANKING CORPORATION. DEUTSCH ASIATISCHE BANK.
MERCANTILE BANK OF INDIA, RUSSO-ASIATIC BANK,
Enclosure 3 in No. 1.
Shanghai General Chamber of Commerce to Senior Consul.
Shanghai, December 12, 1912.
I HAVE the honour to enclose copy of a letter addressed to the Chamber by Messrs. D. Sassoon and Co. and Messrs. E. D. Sassoon and Co. on the subject of the violation of the treaty existing between the British and Chinese Governments with regard to opium traffic.
It would seem from this communication that notwithstanding the treaty and the existence of a later very definite understanding between the British and Chinese Governments as to the restriction of the supply of Indian opium, the President of the new republic has deliberately ignored the agreement and has issued an edict entirely prohibiting the use of opium under very severe penalties.
I have, therefore, the honour to invite your assistance in impressing on the Chinese Government through the diplomatic body in Peking the necessity of strict adherence to its treaty obligations.
I have, &c.
EDWARD MACKAY, Chairman.
Enclosure 4 in No. 1.
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order to avoid any misunderstanding in the interpretation of the agreement, the Wai-wu Pu wired in June of last year to all the provinces an explanatory telegram in which it was clearly stated:-
"But if in any province the cultivation has not entirely ceased and there is still a large number of smokers, no forcible repressive measures must be taken in that province in respect of the trade in and movement of foreign and native opium."
In February of this year the Chekiang authorities, contrary to the terms of the above-mentioned agreement, prohibited the importation of and trade in Indian opium and enforced the closing of all the existing shops throughout the province, not- withstanding the generally known fact that the cultivation of the native drug in the province, instead of ceasing, had actually increased. made both to the local and central Governments have so far proved ineffective, and Protests and representations although the Chekiang authorities have admitted the illegality of their action the prohibition still remains in full force.
The success of the province of Chekiang in defiantly disregarding the treaties has encouraged other provinces to follow its example, and one after another Kwangtung, Hunan, Kiangsi, and Kiangsu have closed their doors to Indian opium. The transit passes, which are issued by the Maritime Customs on payment of the consolidated duties and which are meant to entitle the opium to be transported to any part of China, with the exception of those provinces which have been closed by treaty, are now valueless, and on several recent occasions opium accompanied by such passes has either been seized, destroyed, or returned to Shanghai.
The Central Government has been advancing the plea that it had no control over the provinces who were acting contrary to its wishes. But it has recently been discovered that the Penal Code, issued in May last by the Board of Justice and approved by the President, contains clauses making the importation, purchase, sale, and smoking of opium a criminal offence punishable by penal servitude. This clearly proves that the provinces have been acting with the authority and under the instructions of the Central Government.
With the exception of the foreign settlements of Shanghai, practically all the outlets for Indian opium are now closed, and the Chamber will be able to realise the gravity of the situation when we point out that the stocks of Indian opium in Shanghai, Hong Kong, and on the way from India at present amount to about 29,000 chests, representing an approximate value of 10,000,000%., and we feel that, unless an immediate and satisfactory solution of the present impasse is arrived at, a financial crisis of the gravest consequence is inevitable.
We trust, therefore, that your committee will appreciate the fact that the situation demands the Chamber's immediate attention, and we hope that strong representations will be made to the diplomatic body in Peking to forcibly impress upon the Chinese Governinent the necessity of fulfilling the treaty obligations.
We remain, &c.
DAVID SASSOON AND CO. (Ltd.). E. D. SASSOON AND CO.
Sir,
Messrs. D. and Messrs, E. D. Sassoon and Co. to Shanghai General Chamber of Commerce.
Shanghai, December 11, 1912. WE beg to draw the attention of the Chamber of Commerce to the critical situation of the opium trade occasioned by the unlawful action of the Chinese authorities.
In
In order that your committee may fully understand the situation it is necessary to give a brief résumé of the principal incidents affecting the trade since 1907. deference to the wishes of the Chinese Government, the British Government agreed in that year to reduce annually the number of chests exported from India to China by one-tenth with the view to bringing the trade to an end in 1917, provided China would on her part reduce the cultivation of the native drug.
In 1910 the Canton authorities, in violation of the additional article to the Chefoo convention, imposed a tax of about 300 dollars per chest over and above the consolidated duty and li-kin and also barassed the trade by other illegal restrictions. After prolonged negotiations between the British and Chinese Governments, a new agreement was made, in which, in return for the increase of the consolidated duties from 110 taels to 350 taels per picul, China undertook to cause to be withdrawn all taxations and restrictions so long as the additional articles to the Chefoo convention remained in force.
In that agreement China was given the right to regulate the retail trade, but, in
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