CO129-519-6 Development of railways proposed by Chinese Government 7-9-1929 - 17-1-1930 — Page 26

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its track unsuitable for fast traffic. Some

30,000 sleeper renewals have been carried out

during the last year or so, which has enabled. traffic to be worked safely by restricting the speed of the through express trains. A great

many more sleeper renewals are however required

before the line can be considered fit for the

Fcceleration of these express trains, which is

considered necessary in order to retain the

present passenger traffic, and attract more traffic

in competition with the river steamers.

6. With regard to the remaining proposals for the expenditure of the loan as set forth by r. J.K. Choy in the document referred to, this

Government can but express its satisfaction at the good intentions implied thereby. I would, however, refer you to the enclosed copy of some observations on this document by the Tanager of the British Section, to whom the matter was referred for comment.

7. With regard to the reference on page 9 of the document to the ratio of division of earnings, I may here remind you that the present ratio is

65-35 for the Chinese Section and British Section

respectively, as laid down in the Working agreement. This was based upon the hypothetical returns on the approximate then known capital expenditure for the construction of each Section, namely Chinese Section $15,130,000 and British Section $10,533,000.

Since

that date considerable additional capital has been expended on completing both Sections and providing

facilities.