:
8
the 31st day of March, 1917, after completion of the purchase by the Chinese Government as herein before mentioned, with the exception of such opium which has been labelled, certified, and delivered before the suid date, at the price of 5,700 taels per chest, payable by the said Mr. Wong in Chinese Government bonds similar, to all intents and purposes, to those which will be payable by the Chinese Government as aforesaid;
And whereas the said Mr. Wong has been using, and, in consideration of the premises, promises to use his best endeavours to secure the successful purchase by the Government of the residue of the stock of opium which will be held by the Hong Kong Combine on the 31st day of March, 1917, for which said Heng Kong Combine, the sail Shanghai Combine, herein acts, and whose obligations, as "herein specified, the said Shanghai Combine hereby guarantees;
And whereas the said Mr. Wong also agreed to purchase the residue of the Hong Kong Combine stock of opium as may be left over on the 31st day of March, 1917, after the eventual completion of the purchase of part of it by the Chiuess Government, for which negotiations are pending as hereinbefore stated, also the price of 6,700 taels per chest, payable by the said Mr. Wong in Chinese Government bonds similar to all intents and purposes to those which will, eventually, be payable by the Chinese Government should the present negotiations be successfully concluded.
And, whereas, it is agreed between the said combine and the said Mr. Wong that the compensation hereinafter provided for shall be understood to be in full settlement and satisfaction of all claims by him in respect of all services rendered to date as aforesaid, and all services to be rendered till final completion by the Chinese Government, of its obligations, as well as in full settlement reimbursement and satisfaction of all claims by him for salaries paid to the staff, rewards to informers, travelling and hotel expenses incurred by him, his partner, agent, middleman, or servant, and generally of all out of pocket expenses and disbursements incurrel by him in the course of his services as aforesaid in extricating the combine from a grave and critical financial position, and under the above-mentioned agreement of the the 4th April, 1916.
Now, it is hereby mutually agreed by and between the parties hereto as follows:-
1. As a cumulative remuneration Mr. Wong shall be entitled to receive and shalt receive from the combine a payment of 2,500 taels per chest on every chest of opium coming under either of the following classifications
1
(a.) Opiuma sold and delivered by the combine since the 31st day of December, 1916, the date when negotiations with the Chinese Government were practically brought to a conclusion, to the 31st day of March, 1917. (b.) Opium paying the special contribution of dollars 3,500 to th Chine-e Government under the agreement dated the 1st day of May, 19.5, enjoying the benefit of the protection of the declaration issued by the Tuchun, of Kiangsu, dated the 28th day of January, 1917.
(c.) Opium to be purchased by the Chinese Government as aforesaid, and paid for
in Chinese Government bonds.
As well as the sum of 1,700 taels Shanghai sycee for every chest of opium sold by the Hong Kong Opium Combine, since the said 31st day of December, 1916, to Canton
merchants.
2. Should the agreement with the Chinese Government for the purchase by same of the residue of the stock of the Hong Kong Combine be concluded, the above classi- fications (b) (e) shall apply also to the Hong Kong stock
3. The aforementioned payments to Mr. Wong shall be paid in cash in classifications (a) and (b) and in Chinese Government bonds, as the combine will receive, in classi- fication (c).
4. On the 31st March, or at such other subsequent time as the combine will decide, the said Mr. Wong shall take over and pay, at the rate of 5,700 taeis per chest, all residue of the stock which may be left after the completion of the purchase by the Chinese Government, with the exception of such chests which will come under classiti- cation (b). The said Mr. Wong shall pay for said stock in Chinese Government bonds similar to all intents and purposes to those which the combine will receive from the Chinese Government. It is clearly agreed that Mr. Wong fully understands the present.situation and the risks connected with this purchase, and that the combine's responsibility shall cease on the combine handing over to him delivery orders for the
9
chests in question, the combine declining all responsibility if said opium shall be depreciated or rendered valueless by action of the Chinese Government or any other Government or of any consular or municipal authority.
5. The combine shall have the right to keep all or any of the monies due to Mr. Wong, under the present agreement, as a guarantee for the faithful performance by bim of the conditions and stipulations herein agreed upon.
6. In consideration of the promises the said Mr. Wong will continue at all times to render to the combine every assistance in his power and co-operate with it for the smooth and successful working of this agreement in relation to the Chinese Government or otherwise.
In witness whereof the said parties have hereunto set their hands and seals the and first above written.
year
Witness:
day
Witness:
(Signed)
(For and on behalf of the Shanghai Opium Combine),
Enclosure 8 in No. 1,
(Signed)
Statement as to Opium Prices. (Communicated by Mr. Ezra, May 1.)
Prices
may be divided into four periods or sections :--
1. 1911 to February 1913, when combine formed.
Since the year 1911, as a result of the treaty between Great Britain and China, the number of chests imported into China were materially reduced; prices therefore rapidly advanced, so that by July 1911 the rates per chest rose to 4,500 dollars. Owing to the revolution in October, prices declined, and as a result of disorders in the interior, business was seriously affected and merchants compelled to sell cheaper. The average prices during this period were, however, about 4,000 dollars, and taking this figure as a and guide, it would me, assuming six years has elapsed from this period until now, adding interest at 380 dollars per chest, insurance 50 dollars, storage at 125 dollars per per chest ; annum, the result would be that it costs to-day not less than 7,300 dollars but this is working on simple interest, and if we calculate compound interest we will find the figure to be 7,900 dollars at least. The price of 8,200 dollars in bonds would certainly mean a loss to the merchants, as the bonds are depreciate in value. Moreover, merchants who possess opium at the low cost are few, as within this period of six years opium changed hands many times, and once changed the purchaser would find his cost much higher, so that even this price cannot be considered a standard.
2. From February 1913 to May 1915, when the agreement with the Govera-
ment for the surtax was signed.
In this period prices varied considerably, but by February 1914 rose to 7,200 dollars; and, if storage, interest, insurance for two and a half years were added, it would cost to-day 9,000 dollars to 10,000 dollars.
3. From the 1st May, 1915 to the 1st January, 1916. Prices during this period were 8,000 dollars to 15,000 dollars. will lose heavily by the proposed sale to the Chinese Government.
4. Final period.
Of course holders
By January 1916 about 14,000 dollars, February 15,000 dollars, March to end of year from 11,000 dollars to 8,000 dollars.
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