CHINA. 



161 



The German Government claimed exclusive rights 

 in Shantung by virtue of the occupation of Kiao- 

 chau, but denied that Great Britain had any 

 preferential rights in the basin of the Yangtse, 

 nor could the British Government assert such 

 rights and at the same time uphold the policy 

 of the " open door," which was advanced when 

 the British desired concessions in the German or 

 Russian spheres. The railroads actually existing 

 in China had a total length of 350 miles, but con- 

 cessions had been granted before the beginning 

 of 1899 to British investors alone for 2,800 miles. 

 One was for an extension of the existing line 

 connecting Pekin with Tientsin and Shanhaikwan 

 to Niuchvvang. The length of the extension is 

 500 miles, 200 miles of which are north of the 

 Great Wall. As the Russian Government ob- 

 jected to foreign control over this section, the 

 loan of 2,300,000 which was raised to build the 

 extension was secured on the existing railroad 

 from Pekin to Shanhaikwan and on the earnings 

 of the part between Shanhaikwan and Shinmin- 

 ting. The British imperial authorities took the 

 unusual course of recommending this loan to the 

 investing public, thus giving the enterprise a 

 2ha 



>litical character. The interest shown by the 

 British Government in the railroad penetrating 

 the Russian sphere of interest roused the resent- 

 ment of the Russians, who used their influence 

 at Pekin to thwart the English designs in this 

 quarter and to promote the Belgian line of rail- 

 road from Pekin into the heart of the Yangtse 

 region. First the Chinese Government, in spite 

 of the protest of the British minister, removed 

 the Chinese administrator general of railroads, 

 and appointed as his successor one suspected of 

 partiality to the Russians. When the negotia- 

 tions for a loan to build the extension to Niu- 

 chwang were about to be concluded with the 

 Tsung-li-Yamen, the Russian minister protested 

 against pledging any railroad in Manchuria to 

 foreign creditors or subjecting it to any foreign 

 control or management in case of default. The 

 Chinese Government gave him the required assur- 

 ance, and the British financiers agreed to accept 

 as security a lien on the part of the line within 

 the Great Wall and a first charge on the earnings 

 of the rest of the road. The loan was concluded 

 on these terms with the knowledge and assist- 

 ance of the British Government, to which the 

 Chinese Government gave an assurance that the 

 railroad should never be alienated to any foreign 

 power. In all the concessions the Chinese Gov- 

 ernment stipulated that after a fixed term the% 

 railroads and equipments should become its ab- 

 solute property without compensation, and in 

 most cases the concessionaires are obliged to sur- 

 render to the Government 40 per cent, of their 

 profits from railroads and 25 per cent, of their 

 profits from mines. The Government requires 

 also that schools of instruction in the building, 

 management, and working of railroads be estab- 

 lished, and that a certain proportion of the em- 

 ployees shall be Chinese. In February, 1899, the 

 Russian minister protested against the terms of 

 the British loan contract for the Niuehwang ex- 

 tension, which require that the chief engineer 

 shall be British and that a European accountant 

 shall assist in supervising receipts and expendi- 

 ture. These conditions he held to be inconsistent 

 with the Russo-Chinese agreement with regard 

 to the Siberian Railroad. Subsequently the Rus- 

 sians objected to the earnings of the 298 miles 

 of railroad beyond the Great Wall being pledged 

 to foreigners. Application was next made 

 through the Russian minister for the privilege 

 of constructing a Russian railroad under the same 

 VOL. xxxix. 11 A 



conditions as in the case of the Manchurian line 

 to connect the Siberian and Manchurian system 

 with Pekin, starting from Niuchvvang, or some 

 other point on the Manchurian line between Muk- 

 den and Port Arthur. Previous to this Great 

 Britain and Russia, " animated by a sincere de- 

 sire to avoid in China all cause of conflict on 

 questions where their interests meet, and taking 

 into consideration the economic and geographical 

 gravitation of certain parts of that empire," had 

 reached an agreement with regard to their re- 

 spective railroad interests in China, its terms 

 being defined in notes exchanged on April 28 be- 

 tween the British minister at St. Petersburg and 

 Count Muravieff. Great Britain engaged not to 

 seek for her own account, or in behalf of British 

 subjects or of others, any railroad concessions 

 to the north of the Great Wall of China, and not 

 to obstruct, directly or indirectly, applications for 

 railroad concessions in that region supported by 

 the Russian Government. Russia, on her part, 

 engaged not to seek for her own account, or in 

 behalf of Russian subjects or others, any railroad 

 concession in the basin of the Yangtse, and not 

 to obstruct, directly or indirectly, applications 

 for railroad concessions in that region supported 

 by the British Government. The contracting par- 

 ties, declaring that they had nowise in view to 

 infringe in any way the sovereign rights of China 

 or existing treaties, agreed to communicate to 

 the Chinese Government the arrangement that 

 they had concluded, which, by averting all cause 

 of complications between them, was considered 

 of a nature to consolidate peace in the far East 

 and to serve the primordial interests of China 

 herself. In a supplementary note in regard to the 

 Anglo-Chinese extension of the Northern Rail- 

 road to Niuchwang, the Russian Government con- 

 ceded the right of having a British engineer and 

 a European accountant, but the line shall remain 

 a Chinese line and may not be mortgaged or 

 alienated to foreigners. A branch line from Siao- 

 heichau to Shinminting was to be constructed by 

 the Chinese Government, and the Russian Gov- 

 ernment might support, if it saw fit, applications 

 of Russian subjects or establishments for con- 

 cessions of railroads which, starting from the 

 main Manchurian line in a southwesterly direc- 

 tion, would traverse the region in which the 

 Chinese line terminating at Shinminting and Niu- 

 chwang was to be constructed. Lord Salisbury 

 wished to include in the agreement a provision 

 protecting British goods from differential rates 

 on railroads under Russian control, but Count 

 Muravieff preferred postponing negotiations on 

 this subject. The agreement conceded to the 

 Russians liberty to compete with the section of 

 the British line extending beyond the Great Wall. 

 Their new proposal, although put forward as a 

 fulfillment of the agreement, was calculated to 

 provoke a serious conflict with England, for such 

 a short line from Shanhaikwan to Pekin would 

 not only render the British railroad unprofitable, 

 but would enable Russia to place an armed force 

 in Pekin at any moment. Even after receiving 

 the stereotyped reply that by the decree of Dec. 

 18, 1898, no more railroad concessions would be 

 given for the present, the managers of the Man- 

 churian Railroad, supported by M. de Giers, the 

 new Russian minister, insisted on the granting 

 of their application as necessary for them and 

 beneficial to China, avoiding the circuitous Ti- 

 entsin route and facilitating traffic with western 

 Manchuria. The British raised strenuous ob- 

 jections not only in Pekin, but in St. Peters- 

 burg, whereupon Count Muravieff decided not to 

 press the matter, and explained that Russia had 



