CORNELL UNIVERSITY LIBRARY THE CHARLES WILLIAM WASON COLLECTION ON CHINA AND THE CHINESE Cornell University Library DS 740.5.G7A3 1874 3 1924 023 185 022 »«... ^ate Due ^-^w X ^/ Cornell University Library The original of this book is in the Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://www.archive.org/details/cu31924023185022 BRITISH PARLIAMEgTA BY PAPERS TREATIES RELATING TO CHINA 1874 - 1913 CLEVELAND 19 15 \ti^QO^ CONTENTS Corraspondenoe respecting the Treaty 'between Japan and Corea, 1876 Treaty of Friendship and Commerce between Her Majesty and His Majesty the King of Corea, Hanyang, November 26 , 1883 Correspondence respecting the Agreement between the Ministers Plenipotentiary of the Government of Oreat Britain and China, Chefoo, September 13, 1876 Walsham (Sir John) Despatch inclosing copy of a Supplementary Con- vention between Germany and China, March 31, 1880 fyndham (Mr. — ) Despatch inclosing copy of Treaty between Russia and China, February 12, 1881 Correspondence respecting the Agreement between the Ministers Plenipotentiary of the Governments of Great Britain and China, September 13, 1876 Additional Article to the Agree^ient between Great Britain and China, September 13, 1876 Correspondence respecting the French Treaty with Annam, and Nego- tiations between France and China, 1886 Convention between Her Majesty and His Majesty the Emperor of China relative to Burmah and Thibet, 1886 Despatches transmitting the Russo-Mongolian Agreement and Protocol of October 21, 1912 JAPAN. No. 1 (1876). (1/7, /'>,^<^ , _y2(._H;_,C-<-J9o ^ 0- •-f:n\ CORRESPONDE-NCE RESPECTING THE TEEATY BETWEEN JAPAN AND COEEA. Presented to both Houses of Parliament by Command of Her Majesty. 1876. LONDON: PRINTED BY HARRISON AND SONS - j, [0.-1530] ■' y, J% ,,„|l, Z/ HKl Vh-;::n,Y LIST OF PAPERS, No. 1. Ml'. Plunkett to the Earl of Derby 2. Sir H. Parkes to the Earl of Derby 3. Sir H. Parkes to the Earl of Derby 4. Sir H. Parkes to the Earl of Derby 5. Sir H. Parkes to the Earl of Derby 6. Mr. Plunkett to the Earl of Derby 7. Mr. Plunkett to the Earl of Derby 8. Mr. Plunkett to the Earl of Derby Five Ir.closures. 9. Mr. Plunkett to the Earl of Derby 10. Mr. Plunkett to the Earl of Derby 11. Mr. Plunkett to the Earl of Derby 12. Sir H. Parkes to the Earl of Derby 13. Sir H. Parkes to the Earl of Derby One Inclosure. 14. Sir H. Parkes to the Earl of Derby One Inclosur^. 15. Sir H. Parkes to the Earl of Derby Page December 9, 1875 1 December 31, 2 January 10, 1876 3 January 29, 3 February 7. 4 February 21, 4 February 21, 4 March 3, 5 March 6, 6 March 9, 7 March 9, 8 March 20, 9 March 25, 9 March 27, 12 March 27, 17 Uf^»^ 1 ' ,N — >6lUa^ ^-^(U(. Correspondence respecting tbe Treaty between Japan and Corea. No. 1. Mr. Plunkett to the Earl of Derby. — {Received January 17, 1876.) (Extract.) Yedo, December Q, ] 87 5. I HAVE the honour to itiform your Lordship that, having received a ]jrivate note from Mr. Terashima stating that he wished to see me about some current business, I called at the Foreign Department at 2 o'clock this afternoon, accom- panied by Mr. McClatehie. Instesad of enteritig on the business he had mentioned in his note, his Excel- lency at oiice began the conversation by stating that he wished to speak to me on a subject Which he had frequently discussed with Sir Harry Parkes. I wfds dbubtless aware of the peculiar relations which have existed for the last three hundred years bet\^feen Japan and Corea, and he need not allude to the accusations made by the public papers against Her Majesty's Minister of having encouraged the warlike aspirations of Japan in that quarter. These accusations were totally false, and the Government had at once published a formal denial of the charge. He merely now alluded to them as a preface to what he was going to say. The position of the Japanese Settlement at Sorio was becoming untenable, the Coredns would not act up to the Convention concluded with Mr. Moriyama, and finally, the Attack on the Imperial gun-boat '^Unyokan" had exhausted the patience of the Japanese Government, and they felt the time was come when they must take steps to place their intercourse with Corea on a more satisfactory footing. He, thefefore, how wished to take the first opportunity of informing me, as Sir Harry Parkes was not AVithin reach, that the Government had decided on sending a Special High Commissioner to the capital of Corea, to propose the negotiation of a preliminary Treaty of Commerce and Navigation. The person selected for this mission is Mr. Kuroda, one of the Cabinet Ministers and head of the Ministry of Colonization. He will set out in about ten days, and will be accompanied by Several secretaries, and also by two or three men-of-war and a very small body of troops. This small force is in no way intended to act aggressively, but is only for his protection in case the Coreans should attack the Mission. If thfeCdrean Government receive Mr. Kuroda arid accept his proposals,. there need be no diffltulty in the matter; but, should he meet with a hostile reception, it will be his duty simply to return and await the further instructions which may be given to him. No special military arrangements are being made in view of this Mission, and the Goveiniihent hope it will be found unnecessary to have recourse to strong measures. [540] B 2 No. 2. Sir H. Parkes to the Earl of Derby. — {Received February 12, 1876.) (Extract.) Yedo, December 31, 1875. MR. PLUNKETT'S despatch of the 9th instant will have informed your Lordship of the determination taken by the Japanese Government to deal with the Corean question by dispatching to that country a High Commissioner and Special Envoy charged with the negotiation of a Treaty of Commerce, and supported by considerable naval and military force. Since my return to Yedo on the '22nd instant I have endeavoured to learn why the Japanese Government adopted this step at the present time, and how far the execution of their plans had advanced. The Foreign Minister stated to me on the 24th instant that, having once taken the determination to send a High Commissioner to Corea, the Government thought it desirable to carry it out promptly. Such a mission was judged necessary because events had shown how hopeless it was to attempt to treat with the local Corean officials at Fusankai, and the relations of Japan with Corea could no longer remain on their present unsatisfactory footing. In order to effect the necessary changes, certain essential conditions would be required at once, while others might be obtained gradually. Those which would at once be demanded from the Coreaus t were Firstly, the opening of one or more Corean ports, to which the Japanese should be admitted to trade freely. Secondljr, proper provision for the treatment of shipwrecked Japanese, and for the relief of Japanese vessels requiring shelter from stress of weather. Thirdly, a satisfactory explanation of the attack upon the "Unyokan," and an assurance that the Japanese flag should not again be exposed to similar outrage. The Japanese Government had, at one time, supposed that the first and second conditions might have been obtained by means of the arrangement made by the Japanese Agent Moriyama with the local Corean otficials last year. The Coreans then agreed to receive a letter from the Japanese Government, and to dispatch an Envoy in return to Yedo. But when Moriyama returned with the letter this year they refused to receive him. The trifling traffic now carried on by the Japanese at Sorid could not be called trade. The Japanese admitted to that settlement were supposed to belong to the Island of Tsushima only, and they could only buy and sell such commodities as the Corean officer in the settlemont chose to permit. Shipwrecked Japanese were not properly treated by the Coreans, nor were Corean cast-a-ways received from the Japanese in a becoming manner; and the firing on the "Unyokan" proved that Japanese vessels might be attacked if they approached the Corean shores. If the Corean Government refused to concede these three points when demanded by the High Commissioner, the refusal would be regarded as a rupture of relations. In that event, or if the High Commissioner were not received, or encountered insult or attack, he would have to return and leave it to the Government to take the course they would then be compelled to adopt. But, considering the moderate nature of the Japanese demands, he (Terashima) did not see why negotiations should not be successful. Every allowance would be made for the prejudices of the Coreans, and only such an amount of intercourse, whether official or commercial would be asked for as the Coreans in their present condition could grant. The Japanese Government were quite willing to reserve for a later period the question of whether a resident Minister should be sent to Corea. The force sent with the High Commissioner was only intended for his protection. In reply to my inquiry as to when Kuroda, the High Commissioner, would be despatched, Mr. Terashima stated that the precise time was uncertain. It had been suggested that the navigation of the river leading to the Corean capital might be impeded at this season by ice. That contingency had not been thought of when it was proposed that he should leave on the 25th instant. In discussing the subject the same day with another Japanese Minister he observed that the Coreans would be fully informed of the approach of Kuroda and of the objects of his mission. Mr. Hirotsu, the officer who had been sent to S6ri6 to give them notice, had already arrived there. The announcement which he would make to the local Corean officials at Fusankai could be forwarded by them to the Government at the capital by the 25th instant Mr Kuroda would not arnA- off the river leading to the capital before the 20th of January, and thus the Corean Government would receive nearly a month's notice of his arrival. He would endeavour to obtain, by friendly negotiation, the right of trade, protection to navi- gation, and an explanation of the attack on the flag. The latter point would be easily adjusted if the two former were conceded, but, if they were refused, then Japan would be at liberty to treat the firing on the " Unyokan " as a hostile act, and to exact signal reparation. I afterwards saw the Prime Minister, who observed to me that the Government had resolved to close with the Corean question, because they thought that it could not longer be deferred. Some arrangement of the long-standing differences between the two countries had become necessary. This arrangement might be effected by peaceable means, but he was alive to the consideration that the Japanese overtures might be rejected by the Coreans ; and, in that case, collision would prove unavoid- able. No. 3. Sir H. Parkes to the Earl of Derby. — (Received February 21.) (Extract.) Yedo, January 10, 1876. IN continuation of my despatch of the 31st ultimo, I have now to add that the High Commissioner Kuroda left Yedo on his Corean Mission on the 6th instant. The squadron consisted of two vessels of war and three transports, and the military force embarked appears to have been limited to the three companies previously spoken of, or 750 men. No. 4. Sir H. Parkes to the Earl of Derby. — (Received March 15.) (Extract.) Yedo, January 29, 1876. IN continuation of my previous despatches on the subject of Mr. Kuroda's mission to the Corea, I have the honour to inform your Lordship that the expedi- tion, which appears to have been now increased to seven ships, arrived at Fusankai on the loth instant, and remained at anchor there for eight days. On the 23rd instant the expedition sailed for Kokwa, where it ought to have arrived on the 26th. The object of its stay at Fusankai for so long a time was probably twofold ; first, to prove to the Coreans that the expedition had actually started, and to give them time to appreciate its strength; and, secondly, to enable Mr. Kuroda to obtain information as to the probable intentions of the Corean Government. Kokura is the most convenient centre for communicating, at the same time, with the large military stations. of Hiroshima, Marugam^, and Kumamoto, and is, moreover, on the direct road from Yedo or Osaka to Corea. It has the best anchorage in the Shimonoseki Straits, and is distant only about 125 miles from Tusankai, and about 450 miles from Kokwa. It is evident on all sides that the Japanese Government is getting a force in readiness ; but, whether it will be necessary to resort to actual hostilities or not depends upon the manner in which the Coreans receive Mr. Kuroda when he arrives at Kokwa. The Japanese Government expect to receive positive intelligence on this point about the commencement of next month. I think, however, it may not improbably turn out that the Coreans will hesitate to take any decided action at the outset, and that some days may be lost after the arrival of the expedition at Kokwa before Mr. Kuroda will know whether he is going to be received as a friend or as an enemy. It is also not improbable that the very unusual severity of this winter may greatly retard the advance of the expedition, as well at sea as on land. No. 5. Sir H. Parkes to the Earl of Derby. — (Received March 25.) My Lord, ^ Yedo, February 7, 1876. THE Vice Minister of State, Iwakura, informed me yesterday that the Govern- ment were without any news from the Corean expedition, and, therefore, hoped that it had not met with a hostile reception. He said that all the vessels composing the expedition rendezvoused at Port Horner, which, he said, is on an island about 120* miles from Kokwa, on the 23rd ultimo, and were expected to reach Kokwa by the 27th at latest. Had they been fired upon on their arrival there, news of such an event would by this time have reached Yedo. His Excellency hoped therefore, that the Coreans were inclined to allow negotiations to be entered on. I mentioned in my despatch of the 29th ultimo that I thought the Coreans would hesitate to take any decided action at the outset, and that some days might elapse after the arrival of the expedition at Kokwa before Mr. Kuroda would know whether he was to be received as a friend or as an enemy. The circumstance of the vessels arriving off Kokwa just at the period of the Korean new year, would not be favourable for the transaction of business, and it is possible that the delay, which I anticipated as probable, has in reality taken place. His Excellency again emphatically assured me that the Japanese Government had no desire for war, which would only be resorted to if absolutely inevitable. I have, &c. (Signed) HARRY S. PARKES. No. 6. Mr. Plunkett to the Earl of Derby. — (Received April 8.) (Extract.) . Yedo, February 21, 1876. WITH reference to Sir Harry Parkes's despatch of the 7th instant, I am assured, both by the Minister for Foreign AtTairs and by the Vice-Minister of State, that they have had no intelligence of any description from Mr. Kuroda later than what he sent on his arrival at Port Horner on the 23rd ultimo. Your Lordship will recollect that Port Horner is only 120 miles from Kokwa, and that Mr. Iwakura expected that the Japanese squadron would reach the latter place somewhere about the 27th ultimo. As Mr. Kuroda has some fast steamers with him, he could .easily communicate with Shimonoseki, from which he is less than 500 miles distant, and where he would strike the telegraph wires to Yedo. Therefore both the Government and the public here appear to consider this long silence to be a symptom that negotiations of some kind with the Coreans have been commenced. No. 7. Mr. Plunkett to the Earl of Derby. — (Received April 8.) (Extract.) Yedo, February 21, 1876. WITH reference to my precedirig despatch, I have the honour to inform your Lordship that I called upon Mr. Iwakura on the 19th instant, to communicate to hiin a portion of a telegram which I had received from Sir Thomas Wade. 1 told his Excellency that I knew Her Majesty's Minister was in the habit of giving him any interesting news he might receive from Peking. I thereforo had come to let him know that Sir Thomas Wade had telegraphed, on the 3rd instant, that the Tsung-li Yamfen had informed him that China would not interfere in the Corean question ; and, moreover, that he had heard from the Japanese Ministet- that Li Hung Chang had promised Mr. Mori to advise that the Yam6n should recommend Corea to be reasonable. Mr. Iwakura replied that the latest intelligence from Mr. Mori, which was about a fortnight older than Sir Thomas Wade's telegram, only stated that he hoped China woulfl not interfere, but he had not then been able to obtain any positive assurance from the Yam^n on the subject. His Excellency said he was, therefore, much pleased to learn what Sir Thomas Waj^e ha(l reported Respecting the non-interference of China. His Excellency said he trusted Mr. Kuroda's long silence was a sign that the Coreans had consented to negotiate, but he hoped every moment to hear something positive ; and he promised, in return for the importapt news I had given him, to call on me as soon as he had anything to communicate from Mr. Kuroda. No. 8. Mr. Plunkett to the Earl of Derby. — (Received April 24.) My Lord, Yedo, March 3, 1876. ABOUT 9 o'clock on the afternoon of the 1st instant I received a private note from Mr. Iwakura, translation of which is herewith inclosed, informing me that negotiations with Corea were concluded, and that a Treaty had been signed on the 27th of February. I have the honour to inclose copy of the reply [ wrote unofficially to Mr. Iwakura on receipt of his Excellency's note, as well as of a private letter which I received next morning from the Vice-Minister for Foreign Affairs, and of the note which I sent to him in acknowledgment of his communication. No particulars having yet been published, 1 called this afternoon on Mr. Tera- shima, and, after congratulating his Excellency on having so quickly obtained a pacific solution of the Corean question, I inquired whether he could tell me what were the conditions of the Treaty. His Excellency replied that he could tell me nothing more than what I had heard from M. Sameshima. Mr. Kuroda had merely telegraphed one single line from Shimonoseki, and was coming on directly to Yedo, where he ought to arrive on the 5th. After the Commissioner's arrival only would the Cabinet itself know the conditions ; but Mr. Terashima added laughingly, '■' when the news is good, one line is sufficient." The substance of Mr. Kuroda's telegram was published yesterday in the Procla- mation, of which a translation is herewith inclosed. Nothing whatever had been heard from Mr. Kuroda since the end of January, • and pothing had transpired as to how he had been i*eceived on his arrival atKdkwa. The intelligence, therefore, has taken everybody by surprise, and has been, as far as I can yet judge, received with pleasure by the public, both foreign and Japanese. I have, &c. (Signed) F. R. PLUNKETT. Inclosure 1 in No. 8, Mr. Iwakura to Mr. Plunkett. (Translation.) Yedo, March 1, 1876. ACCORDING to the promise which I made to you when you were so kind as to visit me and have friendly conversation a few days since, I beg to inform you that a telegram was received at 2 o'clock this afternoon from Kuroda, our High Commissioner Plenipotentiary, now residing at the Island of Kdkwa, in the counti-y of Cored, to the effect that his negotiations with that country have been completed!, and that the seals of both parties were attached to a Treaty on the 27th ultimo. In haste, (Signed) IWAKURA TOMOMI. Inclosure 2 in No. 8. Mr. Plunkett to Mr. Iwakura. Sir, Yedo, March 1, 1876. I BEG to thank your Excellency for your kind note of yesterday, and for hariag So profiiptly informed me of the happy conclusiori of the negotiations with Corea. I hasten to offer you my best congratulations on an event which will mark an epoch in the history of this Empire. I avail, &c. (Signed) F. R. PLUNKETT. Inclosure 3 in No. 8. Mr. Same'shima to Mr. Plunkett. My dear Mr. Plunkett, March 2, 1876. IT gives me much pleasure to inform you that Mr. Kuroda arrived yesterday at Shimonoseki, whence he has telegraphed the satisfactory news that he has concluded a Treaty with Corea. Knowing you are interested to hear about Corea, I take the earliest opportunity to inform you of the above facts. Sincerely yours, (Signed) SAMESHIMA. Inclosure 4 in No. 8. Mr. Plunkett to Mr. Sameshima. My dear Mr. Sameshima, Yedo, March 2, 1876. I HASTEN to thank you for the friendly note you sent me this morning, and beg at the same time to congratulate you on the excellent news you have received from Corea. Believe me, &c. (Signed) F. R. PLUNKETT. Inclosure 5 in No. 8. Notification No. 25. (Translation.) To In, Sho, Shi, Ch6, Fu, and Ken. IT is hereby notified that a telegram has been this day received, to the effect that our High Commissioner Plenipotentiary, Kuroda Kiyotaka, has concluded his negotiations with the Corean Government, and that a Treaty was exchanged with the said Government on the 27th ultimo. ;(Signed) SANJO SANEYOSHI. Daiid-Daijin. March 2, 1876. No. 9. Mr. Plunkett to the Earl of Derby. — (Received April 24.) ^^w'ftw f . J ... Yedo, March 6, 1S76. WITH reference to my despatch of the 3rd instant, in which I informed your Lordship tfiat a telegram had been received from Shimonoseki, announcine- the conclusion of a Treaty with Corea, but that the Japanese Government did not then know Its provisions, 1 have now the honour to report that the High Commissioners arrived in Yedo on the morning of the 4th instant. ""ins>sioners As they were not expected to reach this until yesterday, no preparations had been made to receive them, and they landed privately at Shinagawa. • , Z-^T Ju ^°"^^^^''' ^«ss^«- Kuroda and Inouye made their formal entrance into Yedo They were received at the railway station by a guard of honour and bv severa Cabinet Ministers, troops were drawn up on the square outside the town was all hung with flags, and they were escorted by cavalry to the Council of State where they laid the Treaty officially at the feet of the Mikado ' f J ^n^^ 7^ r^ ^^^^ ^^^^ 1° ''^ ^^^ Minister for Foreign Affairs, and the text of the Ireaty has not yet been published ; moreover, Is to-day is a Japanese hohda> I cannot expect to learn any more particulars before the closing of to Sfght's I am enabled, however, to inform ypur ,L.ords>hip that Mr. Aston iwent, at jmy r(^ques,t, to th^ Foreign Department yesterday. He, sa>v Mr. Ishibashi and asked hm^ vsrhether he >vould wot tell hipi the sybstance pf the Treaty,, as I did 'Hot wish tp trouble tlie Mi,nister himself, \vhe|i,tiis tjipe.^as probably so fully qccupied. That g^qtleman having gone in to consult with Mr. Terashima, told" Mr. Ashton that the principal provisions of the Treaty ^f?:-^,,:) , j 5J,er,mission for a Japj^n^se, Legation to reside in?the Cprean Capital. Fusankai and two other ports tp be opened to Japanese trade. ,.. Japanese tp survey the coasts and decide which two harbours they prefer. . i .Arrangements fpr proper treatment of any Japanese subjects who may be shipwrecked on the Corean coasjts,. „ , , ,.,,', i , , , ; > The regulations under which the trade will be carried on are reserved for future discussion. ^ . , ,i :. ... The Treaty has already been ratified, by the King of Corea. , > ; ) ,u Mr. Ishi^)ashi did not, inform Mr. Aston whether or not the, Treaty contains any ol;her stipulations, but I think it. most probable that it docs; and, as J am; to. s^e I^r. .l^erashima to-morrpvv, I will reserve any fprther remarks on this subject till the departure of the American mail at the end of this week. i j ,i'( J, ,The negotiations were carried on an;d. the Treaty signed at K^6kwa (Kang-Hoa). Neither ^the Japanesfe Commissipners nor any, of their suite, went tOi.the capital itself; but it would seem they could easily have doi:\e,SQ if they had wished. -j! , I have, &(?4 ; ■■'.- ' (Signed; F. R. PLUNK ETT. IsTo. 10. Mr. Plunkett to the Earl of Derby. — {Received April 16.) (.Extria^l;,) .^ , , , ,,,,,,,,. m. j. Yedo, Ma'gch.9,181B. ,,, WITJ'H reference to my despatch of the 6th. instant, in which .1 reported alL tif^t T ,ha,d so far been able tp l^arn respecting the, nature, of the Treaty concluded bjj^ j^essrs. Kurpda, and In.ouy^ witl:^ Corea, I have the honour to inform. .youjriLord- ship that I called on Mr. Terashiraa two days ago, in the hope of obtaining' some jfjurther infprmatipn as tp its details. ; •■i, , . . i- . J His Excellency said, he cquld not tell me much more than I appeared to know; already, for he had not yet had time to examine the Treaty thoroughly himself. It hfad.npt jret been,|ratified, by the Mikado, and various formalities had still to be gone through; so he cpnsideyei;! it could not; be published at soonest for some, weeks yet. He assured me, however, that the only essential points as yet gained by the, Japanese were the five which I reported to your Lordship in the despatch already alluded to, namely, Japanese Legation in Corean capital and a Corean Legation at Yedo. i ., . Fusan and two other ports to be opened to Japanese trade. Survey of Corean coasts by Japanese, to decide which ports are most suitable for trade. Arrangements respecting shipwrecks. Trade regv^lations to be discussed subsequently. , , ; : ^,, Mr. Terashima informed me that from the first appearance of the Japanese on the cq^st they were most amicably received by the Coreans. , - ^jThg^ Corean Plenipotentiaries had at once agreed, in principle, to their proposals, and the only difficulties which Mr. Kuroda had had to contend with were on questions of form. . , , . . ^^ For, instance, the principal delay in the conclusion of the negotiations had arisen from the Coreans refusing to insert the name of their King in the Treaty, It was, tliey said, impossible for them to write it. . This difficulty, however, was overcome by the insertion of the word [Japanese characters! once;at the commence- ment of the Treaty and afterwards the words " Corean Government" were employed whenever in the Treaty it was necessary to allude to the supreme authority of that country. . , ,. i. , _ The, Coreans objected tp insert the word Emperor, no doubt because .that would , be assuming equality with China, or to use the word King, because that woilld be placing themselves in an inferior position to Japan. [540] C They, however, appear to have made no difficulty about giving the proper titles and honorifics to the Mikado of Japan. . In reply to my inquiry whether he believed that China had given advice to the Coreans in this matter, Mr. Terashima said that the Japanese Commissioners were inclined to believe that she had recommended the Coreans to receive the Ambassadors courteously, for it was known that a messenger had arrived in the Oorean capital early in February from Peking. . I gathered from Mr. Terashima that, as the regulations under which trade is to be carried on are not yet settled, but are to be discussed by Plenipotentiaries who are to be sent for this purpose to K6kwa, he 'presumed that the commerce with Fusan will for the present be carried on in the same manner as has hitherto been the case. When I pressed him as to how far Japanese subjects would be permitted to penetrate into the country, whether, for instance, they would go beyond the present boundary and enter the walled city of Fusan, he replied that all these matters still remained to be settled. "Our Treaty," said Mr. Terashima, "is much like the first Treaty made with Japan by Commodore Perry at Shimoda. It is as yet only a rough instrument, and the details will all have to be settled when the Regulations for Trade come to be discussed." Having heard privately, and having also seen in the newspapers, a report that by the Treaty one of the southern Corean Islands had been ceded to Japan, I thought it right to ask Mr. Terashima whether there was any truth in the rumour in question. His Excellency stated most emphatically that no cession whatever of territory had been made by Corea to Japan. The Japanese Government will immediately send vessels to survey the Corean Coast with a view to selecting the two ports which it will suit them best to have opened. The Japanese Legation in the Corean capital and the Corean Legation at Yedo will be established only fifteen months after the signature of the Treaty ; but in the meanwhile, probably within a few months, special Plenipotentiaries will be sent to K6kwa to frame the Trade Regulations. I inquired of Mr. Terashima whether the Japanese Commissioners in their negotiations with the Coreans, had alluded to the opening of the country also to Europeans. I gathered from his reply that they had not given any advice on that point, and had confined themselves entirely to the attainment of their own objects. Before leaving K6kwa, Mr. Kuroda received from the Coreans a written communication expressing their regret for the attack made on the "Onyokan" last September. The Japanese have been much impressed by the poverty and wretched appear- ance of all the Corean towns and villages which they visited. No. 11. Mr. Plunkett to the Earl of Derby. — {Received April 16.) My Lord, Yedo, March 9, 1876 SINCE closing my despatch of this date, I have had a short conversa- tion with Mr. Sameshima, the Vice-Minister for Foreign Affairs, and have learnt from him that in addition to what I have reported, there is also a provision in the Treaty insuring to the Japanese Government jurisdiction over their own subjects residing in the open ports of Corea. Mr. Sameshima said that the manner in which this is to "be carried out has still to be settled ; but the principle of extra-territoriality has been conceded to them by Corea. He spoke at some length and with manifest satisfaction of the good effect the news of Mr. Kuroda's success had had in this country ; and, as far as it is possible to judge public opinion from its expression in the native press, it appears to me his anticipations of increased strength to the present Government ought to be ■well founded. With one exception all the native newspapers were at first opposed to the expedi- tion. They are now unanimous in their admiration of Mr. Kuroda's diplomacv and all congratulate the Government in having attained their object without exposing the country to the miseries of war. I have, &c. (Signed) F. R. PLUNKETT. No. 12. Sir H. Parlies to the Earl of Derby. — (Received May 4.) My Lord, Yedo, March 20,. 1876. AT an interview which I had with the Foreign Minister to-day his Excellency informed me that the Treaty concluded between Japan and Corea, which has not yet been published, will be communicated to the foreign Representatives on J:he 22nd instant. His Excellency observed that in negotiating that Treaty the Japanese Com- missioners had avoided all reference to the question of whether intercourse with other nations should be permitted by Corea, partly because they had heard that the Corean Government wished to stipulate that the Japanese should bring no foreigners to Corea, and they had found it necessary in their own interest to confine their demands to such as concerned Japan alone. They believed, however, that the probability of Corea having to admit other foreigners was foreseen by the Corean Government, as one of the Corean officers who took part in the negotiations, and who had been at Peking, was heard to observe on one occasion that Corea must -expect that a Treaty with Japan would eventually lead to similar engagements being concluded with other nations. I have, &c. (Signed) HARRY S. PARKES. No. 13. Sir H. Parkes to the Earl of Derly. — (Received May 7.) My Lord, Yedo, March 25, 1876. I HAVE the honour to report that the Japanese Government published yesterday the Treaty concluded with Corea, and that they have also communicated it to the foreign Representatives. I now beg to forward a copy by the American mail, which leaves to-morrow ; but I think it desirable, especially as the opportunity is not a fast one, to reserve the observations I have to olBFer to your Lordship on this Treaty for the French mail, which closes on the 27th instant. (Signed) ' HARRY S. PARKES. Inclosure in No. 13. Treaty of Peace and Friendship between Japan and Corea. (Translation.) THE Governments of Japan and Chosen, being desirous to resume the amicable relations that of yore existed between them and to promote the friendly feelings of both nations to a still firmer basis, have for this purpose appointed their Plenipoten- tiaries, that is to say, th.e Goremment of Japan, Kuroda Kujotaka, High. Commissioner Extraordinary to Chosen, Lieutenant-General and Member of the Privy Council, Minister of the Colonization Department, and Inouye Ka-o-ru, Associate High Commissioner Extraordinary to Chosen, Member of the Genro-in ; and the Govern- ment of Chosen, Shinken Han-choo-soo Fu Ji, and Injisho, To-so-Fu, Fuku-s6-Kwan : who, according to the powers received from their respective Governments, have agreed upon and concluded the following Articles : — ARTICLE I. Chosen, being an independent State, enjoys the same sovereign rights as does Japan. 10 In order to prove tlie sincerity of the friendship existing b'etwfeen the iwp nations, their intercourse shall henceforward be carried on ih t6'rms of equality and courtesy, each avoiding the giving of offence by arrogation or manifestations of suspicion. in the first instance all rules and precedents that are apt to obstruct friendly intercourse, shall be totally abrogated, and in their stead rules liberal and in general usage fit to secure a firm and perpetual peace shall be established. ARTICLE II. The Government of Japan at any time fifteen months from the date of the signa- ture of this Treaty, shall have the right to S|end an Envoy to the capital of Chosen, where he shall be admitted to confer witti the Kei-so-han-sho, on matters of a diplomatic nature. He may either reside at the Capital or return to' his country oh the completion of his mission. . „,.. The Government of Chosen in like manner shall have the right to send an Bhyby' to ToMo, Japan, where he shall be ad!mitted to confer Avitli the' Minister of Eoreign iiiffairs on mattei-s of a diplomiatib nature. H^ may either reside at Tokio, or return home on the completion of his' mission. ARTICLE ni. All official communications addressed, by the Government of Japan to that of Chosen, shall be written in the Japanese language, and for a jferiod of ten years froni the present date they shall be accompanied by a Chinese translation. The Government of Clioseii will use the. Chinese language. ARTICLE IV. SSrio in Eusan, Chosen, where ah oMcial establishment of Japan is situated, is a place originally opened for commercial intercourse with Japan, and trade shall hence- forward be carried on at that place in accordance with the provisions of this Treaty, whereby are abolished all former usages, such as the practice of saikensen (junks annually sent to Chosen by the late Prince of Tsusima to exchange a certain quantity of articles between each other). In addition to the above place, the Government of Chdsen agrees to open tw:o ports, as mentioned ia Article Y of this Treaty, ;f or commercial intercourse with Japanese subjects. ,, . . In the foregoing places Japanese subjects shall be fre&to lease land and to erect buildiags thereon, and to rent buildings, the property of subjects of Chdsen. ■ ARTICLE V. On the coast of five provinces, viz., Keikin, Chiusei,'Z^enra,' Eeisho, and Kankio, two ports, suitable for commercial purposes, shall be selected, and the time for opening^ these two ports shall be in the twentieth; m'onth from the second month of the ninth year of Meiji, corresponding with the date-- of Chosen," the-first moon of the year Heishi. ARTICLE VI. Whenever Ja'f)anese" vessels, either by stress of weather or' b^ want of fuel and provisions, cannot reach one or the other of the open ports in Chosen, they may enter any port or harbour either to take refuge therein, or to get supplies of wood; coal, and other necessities, or to make repairs ; ; the expenses incurred thereby are to be defrayed by the ship's master. In such events both the officers and the. people of tl^e locality shall display their sympathy by rendering full assistance, and their liberality in supplying the necessities required. If any vessel of either country; be at any time wrecked or stranded on the coasts of Japan or of Chosen, the people of the vicinity, shall immediately use every exertion to rescue her crew, and shall inform the local authorities of the disaster, who will either send the wrecked persons to their native country or hand them over to the' officer of their country residiag at the nearest port. ARTICLE VII. The coasts of Chosen having hitherto been left uns\^rveyed are very dangerous for vessels approaching them, and in order' to prepare charts showing the positions, of islands, rocks, and reefs, as well as the depth of the water, whereby all navigaiteri*' 11 may be enabled safely to pass between the . two countries, any Japanese mariner may freely smrey said coasts. ARTICLE VIII. There shall be appointed by the Government of Japan an officer to reside at the open ports in Chosen for the protection of Japanese merchants resortirig there, pro- viding that such arrangement be deemed piecessary. Should any question interesting both nations arise the said officer shall confer with the local authorities of Chosen and settle it. ARTICLE IX. Friendly relations having been established between the two contracting parties, their respective subjects may freely carry on their business without any interference from the officers of either Government, anft neither limitation nor prohibition shall be made on trade. In case any fraud be committed or payment of debt be refused by any merchant of either country, the officers of either one or of the other Government shall do their utmost to bring the delinquent to justice, and to enforce recovery of the debt. Neither the Japanese nor the Chosen Government shall be held responsible for the payment of such debt. ARTICLE X. Should a Japanese subject residing at either of the open ports of Chosen commit any offence against a subject of Chosen, he shall be tried by the Japanese authorities. Should a subject of Chosen commit offence against a Japanese subject, he shall be tried by the authorities of Chosen. The offenders shall be punished according to the laws of their respective countries. Justice shall be equitably and impartially administered on both sides. ARTICLE XI. Friendly relations having been established between the two contracting parties it is necessary to prescribe trade regulations for the benefit of the merchants of the respective countries. Such trade regulations, together with detailed provisions, to be added to the Articles of the present Treaty, to develop its meaning and facilitate its observance, shall be agreed upon at the Capital of Chosen or at the Kok'wa-fu, in the said country, within six months from the present date by Special Commissioners appointed by the two countries. ARTICLE XII. The foregoing eleven Articles are binding from the date of the signing hereof and shall be observed by the two Contracting Parties, faithfully and invariably, whereby perpetual friendships shall be secured to the two countries. The present Treaty is executed in dviplicate, and copies will be exchanged between the two Contracting Parties. In faith whereof, we, the respective Plenipotentiaries of Japan and Chosen, have affixed our seals hereunto this twenty-sixth day of the second month of the ninth year of Meiji, and tlie two thousand five liundred and thirty-sixth since the accession of Zimmu Tenno, and in the era of Chosen, the second day of the second moon of the year Heishi, and of the founding of Chosen the four hundred and eighty-fifth. (L.S.) KURODA KU JOTAKA, High Commissioner ^Extraordinary to Chosen, Lieutenant-General and Member of the Privy Council, Minister of the Colonization Department. (L.S.) TNOUYE KAORU, Associate High Commissioner Extraordi- nary to Chosen, Member of the Genroin. (L.S.) SHIN KEN, Dai-Kwan, Han-Choo-Soo-Fuji of Chosen. (L.S.) IN-JI-SHIO, Fulm-Kioan, Tosofv, Fuku-Sokimn of Chosen. [540] D 12 No. 14. Sir H. Parhes to the Earl of Derby. -^—{Received May 11.) (Extract.) Yedo, March 27, 1876. WHEN'the Japanese Government decided to send Kuroda's mission to Corea, they despatched an officer, Mr. Hirotsu, in advance to Fusan, in order to announce this intention to the Corean Government. The despatch which Mr. Hirotsu vpas instructed to deliver plainly told the Corean Government that the High Commissioner would proceed to the capital or its vicinity, and would demand satisfaction for the breach of the agreement concluded with Moriyama in 1874, and for the attack on the Japanese gun-boat. When the Mission reached Tsushima, Mr. Hirotsu reported that the despatch had been delivered at Fusan, but that the Corean local authorities earnestly deprecated the visit of the Mission to the capital. Mr. Kuroda, therefore, determined to proceed to Fusan, in order to make it plainly understood to the Corean authorities that he would carry out his instructions to the letter, and proceed with his ships to K6k'wa. When the ships assembled at the rendezvous off Isle Fournier, they were boarded by local officers, who offered presents, and said that the Government had instructed them to supply their wants. Nothing was accepted from them; and, in order to afford time for the authorities at the capital to know of the arrival of the fleet, they were told that in four or five days the ships would move up to the nearest convenient anchorage to Kdk'wa, which proved to be Ch6san-to. On arriving at Ch6san-to they were again visited by Corean officers, including several of the local authorities of Fusan, who were informed that the Japanese High Commissioners were willing to discuss the business of their mission with high functionaries of similar rank to themselves at K6k'wa, but that unless they were immediately met there by such Commissioners on the part of the Corean Government, they would proceed on to the capital. Shortly afterwards they were informed that Corean - Commissioners would be sent to Kok'wa. The Japanese Commissioners landed and proceeded to K6k'wa in considerable state, and on the 11th they had their first interview with the Corean Commissioners. They said they had been sent by their Government to learn, firstly, why the Coreans bad broken the Agreement of 1874, which they had made with Mr. Moriyama; and, secondly, why they had fired in September last upon the Japanese gunboat *' Uny6kan." The Corean Commissioners pleaded that the local officers of Fusan were to blame for the Agreement not having been carried out, as they had not reported what had occurred to the Government at the capital; and that the firing on the " Un) 6kan " was a mistake, as the Coreans did. not know that she was a Japanese vessel. The Japanese Commissioners observed that the two charges having thus been fully admitted, the question of reparation remained to be considered, and, breaking off the interview suddenly, they said they would inform the Corean Commissioners the next day of the satisfaction they had to demand. At the interview next day, the Japanese Commissioners placed in their hands the draft of a Treaty which the latter said they would accept as satisfactory redress, provided it were at once agreed to. They were willing to allow the Corean Commissioners four or five days, but not more, to consider it. The Corean Commissioners asked for ten days, as they had to submit the Japanese demands to the Government at the capital. The Japanese Commissioners replied that they would allow that time, provided that within the ten days the negotiations were completed, and the Treaty signed and exchanged. The Corean Commissioners appeared to acquiesce, but on the ninth day they began to urge objections, and firstly on point of form. The draft Treaty g-ave the Mikado the title of "K6tei " (Chinese, "Hwang-te," or Emperor), and the Kina: of Corea, " 6 (Chinese, " Wang," or King). This did not denote equality between the two nations, which was professed in the 1st Article of the Treaty. As the Coreans could not adopt the title of K6tei, they wished the Agreement to run in the names of the respective Commissioners only. This could not be acceded to by the Japanese Commissioners, who, however, expressed themselves willing to use the names of the two nations— Dai Trippon and Dai Ch6sen (Great Japan and Great Corea)— instead of the titles of the Sovereigns. The Corean Commissioners then began to raise other difficulties, which were met by the Japanese Commissioners threatening to 18 break off negotiations. On the tenth day (22nd February) they did return to their ships, saying that they would give the Corean Commissioners two or three days to consider whether they would sign the Treaty as it stood, with no other alteration than the one above-named, as they (the Japanese Commissioners) would agree to no further modifications. On the 25th the assent of the Coreans reached the Japanese Commissioners, who proceeded again to K6k'wa on the 26th, signed the Treaty at 9 a-M. on the 27th, re-embarked the same day, and on the 28th the fleet weighed and left Corea. It may not be out of place for me to inclose in this despatch a description of Corea, which has appeared in print, and which has been written by one of tiie leading Secretaries of Kuroda's Mission, as it furnishes some further information confirmatory of the above remarks respecting the capacity of Corea for trade, and the condition of the Corean people. Inclosure in No. 14. Spirit of the Japanese Press. Corea : the Country, Manners, and Customs. {Hochi Shimbun.) HAYING heard that Mr. Miyamoto of the Guaimusho, had returned from Corea with the Envoys, we called upon him. As it is not within the sphere of his duty to give any information upon purely official matters, we did not seek for this. But the following observations made by him upon the state of the country and the habits and customs of the people, may prove interesting to our readers, and we therefore publish them. Having only seen Fusan and the south-western coast for about 500 ri, and Kok'waand its neighbourhood, we cannot speak with accuracy regarding the whole country, but so far as we could see the soil is poor, wears a reddish-yellow appear- ance, is hard, and ill-suited for cultivation. About Fusan, K6k'wa, and the banks of the Kanko river, the ground is covered with hillocks, giving a picturesque appear- ance to the country from a distance. This impression, however, disappears on closer acquaintance. The soil is harsh and the vegetation sparse and stunted. We saw pine trees, but they are crooked and ugly, and not straight and graceful like those of our own country. This proves that the soil is poor, and lumber must be scarce and dear. At K6k'wa we tried to get a cedar log of twenty feet in length, but without success. The principal building material is pine; neither cedar nor "hinoki" {Retinispora obtvsa) are used. It would appear that there is some Inw in Corea limiting the size of the houses of the common people, as they are all domiciled in dwellings about ten or twelve feet square, and little better than dog kennels. The walls consist of a mixture of stone and earth, and the roofs of rice-straw thatch. The plaster which we use in Japan is apparent unknown, and there is but a scanty display of wood. The floors are made like our furnaces, and of compact hardened earth. Oiled paper is placed over this, and on it people sit. Few of the houses have ceilings, which con- sist merely of oiled paper stretched from the uprights supporting the roof. The shops are entered through doors, on which are inscribed sayings of a graceful nature in the Chinese character. Under the floor, and extending throughout its whole length, is a horizontal passage, at one end of this a fire is lighted, the smoke going out at the other, thus the house is warmed. It is difficult to preserve an even temperature. If too much wood is used the heat soon becomes excessive, and i-iVe ?;ersd, much the same, indeed, as with the use of our "kotatzu." This practice appears dangerous, for the soot hangs about the eaves and the exit of the smoke, and were the flames to catch the straw roof the houses would instantly be destroyed. The houses very much resemble the stoves used in Japan for roasting the sweet potato. We saw no mats in the houses, and the people sit on the earthen floor, but not as we do, for they keep their legs out straight. In one of the Government offices we found a chair, much resembling those on which the priests sit. When entering a house people leave their shoes outside. The quantity of fuel consumed in these fireplaces must be greater than that L:i40] D 2 14 used in our own, but reods and rushes are used for the purpose. We asked why the same materials were not employed for roofing purposes instead of rice straw, out were told that thev might only' be used for fuel. The neighbouring hills are coverea wi(h pines ; there appear to be no old trees, the demand for fuel being sucti tnat they are not allowed to grow to maturity. , The Japanese office at Fusan has been in existence 150 years, and stands on 20,000 tsuboes of ground, it is situated on the side of a hill. One of the ancestors of So Tsushima-no Kami had cherry and pine trees planted there, ""t they have never thriven, though they lend some appearance of life to the reddish barren country round them, li is said that in Loochoo there are no shops where goods are exposed for sale, and the same custom seems to obtain in Corea. Though Kok'wa is a fine place, the houses are not built in rows, but scattered here and there, and are only six or seven feet in height. Dried fish and per- simmons, tobacco and straw sandals are apparently the chief objects of trade. Chajrs seemed to have been made for our special accommodation, but they were very rude, and painted with persimmon juice ; skins of leopards were placed over them. All the Government offices have tiled roofs like our own, and being built of brick, are recognisable at a glance. They all have two gates, an outer and an inner, and in some respects resemble our temples. The tiles are of bad quality, and the woodwork shows no skill. The frames of the paper doors are so clumsy and heavy that but very little light is admitted into the rooms, before each of which a board hangs. These boards are not very finely finished, but the Chinese characters upon them are skilfully cut. In respect of conveniences all these offices are very deficient, and, for similar reasons, the public roads are filthy. The widest roads are from fifteen to twenty feet in breadth, the narrower ones from eight to nine. There is no provision at their sides for carrying off the rain, and they are apparently never repaired or improved. The streets are dirty, but are decorated with monuments raised to departed local officials. The city walls of the Kok'wa "Fu " are about five miles in circumference, and run alongside of hills. They are only from two to three in height, partly con- structed of mud and stone and partly of brick. There is a gate on each of the four sides. That which we first entered is called the Chinkai gate, the second the Kotoro gate, and these resemble the gates in Japan. They seem to have been care- fully painted in daj's long past, but have fallen out of repair. The house within the walls are scattered irregularly, and not built in rows. As regards clothing, both the upper and lower garments of the people are of white, and are undyed and unornamented in any way. Some of the officials wear silk, but of very coarse texture. When approaching the land, and at some distance, the Coreans present the pretty appearance of snow herons, but on closer inspection they resemble the lazy priests of our own temples, whose garments may once have been white, but are so no longer. Most of the higher officials dress in white silk, the lower grades wear garments of sky-blue colour, without sleeves. The long- sleeve is the badge of higher rank, and is always worn while on duty. The skirts of dresses resemble those of our own priests, and are called "additional wings,'' — in some sense they may be said to resemble wings. The highest officials wear garments of shining silk of a light pink colour, and their head-dresses are similar to those usually seen in the portraits of Taiko Sama. On their feet they carry large heavy shoes, proving that our ceremonial costume came from China in the time of To, The head-dress is a large round hat, fastened by means of strings passing under the chin, and are said to be made of horsehair by the native women. Custom exacts that the hat be placed on the head when greeting a friend. The Coreans do not shave the head, but wear the hair long, and fasten it with pins into a bunch at the top of the head. These pins are made of silver or brass and vary with the rank of the wearer. The children wear the hair braided or plaited like the Chinese, and we see that Tartar fashions are current in Corea. The women are said to be dressed something like Europeans, but as we did not see a single woman the whole time we were in Corea, it is impossible to speak positively. The dress of the men betrays less vanity than among ourselves. {Continued from March 18.) The domestic animals are dogs, horned cattle, fowls, horses and pigs, and differ but slightly from those of Japan. The cattle and pigs are very fat and the hides of 15 the former are among the exports of the country. Tiio horses are about the size of our colts between one and two years old, or of" the as:; of China, and therefore only about one-third of the size of an Arab horse. We saw no kites or crows in K6'kwa, but we saw birds of the size of pigeons of a dark blue colour with white breasts, sharp bills, and long tail feathers — possibly a kind of jay. They build in the willows near human dwellings, and were called by our people Corean crows. The number of sparrows appears less than in Japan. Wood is very scarce in all parts tlije country which we visited. We saw only pines ; no cedar, oak, plum or cherry trees, excepting those in the compound of the Japanese Agency at Fusan. But the Coreans said that such trees were to be found in other parts of the country. Orange trees seem very scarce in Corea, and their fruit is purchased from our people at Tsushima. Tea does not seem to grow in the country, nor do the Coreans appear to be acquainted with the taste of it. The chief drink is an infusion of dried ginseng or ginger and dried orange peel. When ginger cannot be obtained — it does not grow in Corea — honey is used instead. The tobacco which we saw exposed for sale was a very dark colour. Corea produces rice of much the same quality as that grown in Japan. The people are very proud of its excellence, and aver that it is eaten by the Emperor of China. Goma {sesamum orientalis) of an excellent quality, grows in the country, and its oil is largely used in cooking, eight or nine out of every ten dishes being prepared with it. It is also used for lamp-fuel. No rape is grown. Cotton is probably to be found, but the parts of the country we saw are not suitable to the growth of the plant. Corea probably possesses mines. The hills are bare of grass and trees, and the soil is very dry, so that it is thought there may be much mineral wealth. But the iron mines are the only ones worked ; copper, gold, and silver, if such metals exist, are yet untouched. It is possible that this has arisen from a foolish notion that their discovery would be prejudicial to the nation, and disturb the"f6ng shuey" — a superstition which prevails in Corea. For this reason no gold coins or orna- ments are to be seen ; silver is used for hair-pins, but only in small quantities, and this comes from China. The copper and tin used in the country comes from Japan, and the former is to be found in the coins. The Coreans use copper for many purposes for which we employ earthenware or porcelain. The coins are of two sizes, and are called generically " Tohei Tsuho." One is larger than the other, but both pass as of the same value. It is said that there are coal mines in the country, but, strange to say, dear as fuel is, the Coreans do not seem to know the value of coal for this purpose. There is little worthy of record here in respect of the Corean military forces, though I will say a few words about them. Some 1,500 or 1,600 men came down to K6k'wa when we were there. They wore wooden hats and coats of a reddish colour with wide sleeves, and bore neither armour nor helmets. They were armed with match-locks of a, small size like those used by our Japanese hunters, and with swords, the blades of which, in all probability, are imported from Japan. The number of banners is large in proportion to the number of men, and some had characters upon them, the top of the colour-poles being ornamented with pheasants' feathers. The men appeared to be of all ages ; some were young but many were quite old. They appear better drilled than our troops were prior to the arrival of Commodore Perry, as at that time each Daimio had his men drilled as he chose, while the Coreans had one central Government and one army Their dress seems well enough for fine weather, but bad for rain. It is said that they have only adopted the use of the sword recently in obedience to the command of the reigning Monarch. The various forts are mounted with cannon. The guns round the city throw four and five pound shot. None of them were on carriages, but are merely placed on stones. They are fired with tow ropes, and a place is provided for the safety of the man who acts as gunner. The position of the guns was such as to lead us to infer that several men would be required to manage each one of them. The forts are usually on the sides of hills, and are loopholed for three or four guns. In going up the K6k'wa River to get into the Kanko River, we found the current very strong, running between steep banks, and very dangerous for small boats. In the Kanko River the current is not so rapid, and large blocks of ice floating down stream struck against us in a rather dangerous manner. Buddhism prevails, but the priests do not appear to possess as much power as in Japan. It is said that there is a large Buddhist temple called Bongioji, at Torai, to the north of Fusan, but tiiere are none at K6k'wa, The priests dress in the same 16 way as our own, and attend the death-beds of the people, but have nothing to do with their burial, as m Japan. The reason appears to be that the superstition ol "fgng shuey" prevails, and bodies are interred in the paddy fields, in garflens, woods, or on the hills, or wherever the iaclination of the family may dictate, so that there are no regular bwrying-places. It is said that stone monuments are erected to men of.distinction ; but under ordinary circumstances a heap ot eartti is thrown up over the grave, and when this has disappeared by the operation ot natural causes, which it does in thirty or forty years, the soil is again brought into cultivation. , . - It is said that when the French went to Corea they destroyed the city ot K6k'wa by fire, and took possession of some precious relics which had been buried with certain of the ancestors of the Corean kings. We went to the si'^e ot these tombs. They are two in number, are situated about half-way up a "''!'" a northerly direction from Kdk'wa, and are encircled with walls three feet high and from twenty to thirty feet in circumference. On the tombstone is inscribed "The tonib of Mansenden.'' They resemble the tombs of the "samurai " in Japan, and stand in the midst of waste land. The French would not have disturbed them unless they had known they were royal tombs. At the same time it is wholly improbable that they did know this, so that the story that they disturbed the graves and carried off the valuables contained in them was probably raised by some of the Coreans, who knew that their kings lay buried there, and when Kok'wa was in confusion and pressed by the French, dug up and carried off the treasure, and afterwards imputed the outrao-e to the invaders. The Coreans eat more meat and fat stuff than we do. The beef and pork arie excellent. The oil of goma and garlic are greatly used in cooking, and are even mixed with rice. The Coreans seem to eat but little fish, as we saw no fishmongers' shops, and when we were entertained by the officials there was not a single dish of fish served. At Kdk'wa we occasionally saw in the shops a small quantity of fish looking like herrings, but this was all we met with. We could not discover whether fish is scarce on account of Kdk'wa being near the mouth of the muddy Yellow River, or whether the Coreans do not like it. When the Treaty was signed we were entertained with a repast at which music was performed, and I will give a brief description of the dishes served. There was a sort of confectionery made of sugar, flour, and oil, cut into squares about 2 inches each way; a great heap of boiled eggs; a pudding of flour, "goma," and honey; dried persimmons; pine-seeds; honey-like (sic) food covered with roasted rice, painted red and white; maccaroni soup with fowl; boiled legs of pork, and wine with everything. The wine usually drunk by the Coreans is a strong spirit, but on this occasion was of about the potency of Japanese " sake " of inferior quality. The dishes were of earthenware like the " Imari yaki " (a kind of porcelain) of Japan, or the "goshi" of Ciiina. The table used on the occasion was square, rudely made, and painted with persimmon juice. Oiled paper was used for a table-cloth, and the wine was served from copper vessels. While we were at the hotel we were served with food on common Japanese trays. We presented our hosts with some dried venison, " sak6," and oranges, at which they were much pleased, and said they would send them to the King. We saw no wine-ships, "geishas " (singing girls), or the like. It is said that all natural sons become priests, and daughters prostitutes; but we could not discover whether this was actually the case. We saw some Japanese hair-oil which they said was used by the women. The custom of excluding women from the public gaze seems to exist in Corea as in China, and it is said that even among themselves visitors are not permitted to see the wife. Thus we can give no descrip- tion of the Corean women. Men do not use oil for the hair, which they pin up themselves. We saw no public baths or hair-dressing shops, and we heard that the Coreans do not bathe. In the warmer days of summer they go to the river or seashore to wash themselves; and in the hotel where we stayed "there was not such a thing as a bath, so that we had to send to the ships for tubs in order to wash. This accounts for the filthy state in which the Coreans keep their persons, and for the dirty hue of their once white clothes. 17 No. 15. Sir H. Parkes to the Earl of Derby. — (Received May 11.) (Extract.) Yedo, March 27, 1876. IN continuation of my despatch of the 25th instant, which was sent vid, America, and in which I forwarded without comment a copy of the Treaty recently concluded between Japan and Corea, as communicated to me by the Japanese Foreign Minister, 1 have now the honour to inclose a duplicate copy, and to offer the following observations. Article I acknowledges the independence of Corea, and the equality of the two Contracting Powers. 1 learn that this Article, which was naturally acceptable to the Coreans, is also valued by the Japanese (by whom it was suggested) as denoting that Corea is independent of China. Article II gives to each Power the right of establishing a Legation at the capital of the other, a right which it is believed the Coreans will not be eager to avail themselves of. Articles IV and V open three ports to Japanese trade. One of these, namely Sorio or Fusan, where the Japanese have hitherto had their settlement, is to be opened at once, and the two other ports, which have yet to be chosen, in twenty months' time. By this arrangement the Japanese are relieved of the highly vexatious and derogatory restrictions under which they have hitherto traded at Sorio. Article Y\ opens all Corean ports to Japanese vessels in want of supplies or repairs, or needing shelter from stress of weather, and makes special provision for the careful and hospitable treatment of shipwrecked crews. Article VII provides, in view of the highly dangerous character of the Corean coasts, that "any Japanese mariner " may take soundings and make charts and surveys of those coasts. This task, however, will naturally devolve upon the Japanese Government. Article VllI gives Japan the right to appoint officers (or Consuls) to protect Japanese trade and interests at the open ports. Article IX provides that trade shall be carried on between Japanese and Coreans without interference on the part of the officers of either Government, who are not to place any limitation or prohibition upon trade. The respective Govern- ments are to do their best to enforce payment of debts, but are not to be held responsible for the recovery of them. Article X is specially noteworthy as showing that the Japanese Government, who have lately complained of the extra-territorial clauses of the foreign Treaties with Japan, have been careful to stipulate for the right of jurisdiction over their own people in Corea. They have also imitated those Treaties in not making this right reciprocal, as the foreign Minister has explained to me that this Article does not give the Coreans jurisdiction over their people in Japan. It is, in short, almost a repetition of Articles IV and V of the British Treaty of 1858 with Japan. Article XI stipulates that all rules necessary for the regulation of trade, and any other provisions that may be required either to explain the meaning of the present Treaty or to facilitate its observance shall be negotiated by special Commis- sioners appointed by both countries, who shall meet for this purpose within six months, either at the capital of Corea or at K6k'wa. Article XII provides for the Treaty coming into immediate operation. The resemblance between this Treaty and the British Treaty of 1858 with Japan is remarkable. The omissions or differences are almost entirely confined to those Articles in the last-named Treaty which relate to the exchange of coin, Custom-house control, and similar subjects. It has been explained to me that the Japanese Commissioners omitted mention of these matters on finding that the Corean Commissioners were wholly uninformed about them, and unable to discuss them intelligently, and they therefore inserted instead the Xlth Article, which secures the due consideration and the management of all such details within six months. No allusion is made in the Treaty to any other nation. 5 ca >< r > a 53 CB O e w O ^ I O, o » Q ... t^ a ■ ■ '* d > 3 « !^ &- ^ ' p ?,'^ ' *— 1 >!'-)! 13 00 COREA. No. 2 (1884). 2. TREATY Of EEIEND8HIP AND COMMERCE BETWEEN HER MAJESTY AND HIS MAJESTY THE KING OF COREA. Signed at Hanyafig, November 26, 1883. Presented to both Houses of Parliamtnt by Command of Her Majesty. 1884, LONDON: PRINTED BY HARRISON AND SONS. To be purchased, either directly or through ary BookseDer, froin any of the following Agents, vij:., Messrs. Hamsaed, 13, Great Queen Street, W.C , and 32, Abingdon Street j Westtninstfer; Messrs. Eyrk and SpoItiswoode, Bast Harding Street, Fleet Street, and SaIeX)flBce, House of Lords ; . Messrs. Adam and Chabliss Bla:ck, of Edinburgh ; Messis. Ai,jdxamdek Thom and Co., or Messrs. Hodges, FiGCfis, and Co., of Dublin. [0.-4044,1 Price 2d. TiMiATy of Friendship and Commerce between Her Majesty and His Majesty the King of Corea, \^ at Hanyang, November 26, 1883. [Ratifications exchanged at Hany/ing, April 28, 1884.] HEE Majesty the Queen of the tJnited Kingdom of Great Britain and Ireland, ^fia|»ress of India, and His Majesty the King /of Corea, being sincerely desirous of estahfishing permanent relations of friendship and commerce between their respective dominions, have resolved ,to conclude a Treaty for that purpose, and have thei?efore named as their Plenipotentiaries, that is to say : Her Majesty the Queen of the United Kingdom of Great Britain and Ireland^, Empress of India, Sir Harry Smith Paries, Knight Grand Cross of the Most Distin- guished Order of Saint Michael and Saint George, Knight Commander of the Most Honourable Order of the Bath, Her Majesty's Envoy Extraordinary and Minister Henipotentiary to His Majesty the Emperor of China ; ^s, Majesty the King of Corea, Min Yong-Mok, President of His Majesty's Foreign OflBjoe, a Dignitary of the Eirst Bank, Senior Vice-President of the Council of State, Member of His Majesty's Privy Oouncilj and Junior Guardian of the Crown Prince ; Who, after having communicated to each other their respective fall powSiJiij found m good and due form, have agreed upon and coaoluded the lollgfwing Articles: — AKTICLE I. 1. There shall be perpetual peace and friendship between Her Majesty the Queea of the TJnited Kingdom of Great Britain and Ireland, Empress of India, her heirs and successors, and His Majesty the King of Corea, his heirs and successors, and between their respective dominions and subjects, who shall enjoy full security aaid protection for their persons and property within the dominions of the other. 2. In case of differences arising between one of the High Contracting Parties and a third Power, the other High Contracting Party, if requested to do so, shall exert its good offices to bring about an amiciable arrangement. ARTICLE II. 1. The High Contracting Parties may each appoint a Diplomatic Representative to reside permanently or temporarily at the capital of the other, and may appoint a Consul-General, Consuls, or Vice-Consuls, to reside at any or all of the ports or places of the other wJtich are open to foreign commerce. T?he Diplomatic Eepresentatives and Consular functionaries of both countries shall freely enjoy the same facilities for commuiucatioh, personally or in writing, with the authorities of the country where they respectively reside, together with all other privileges and immunities as are enjoyed by Diplomatic or Consular functionaries in other countries. 2. The Diplomatic Eepresentative and the Consular functionaries of each Power' and the members of their official establishments shall have the right to travel freely in any part of the dominions of the other, and the Corean authorities shall furnish pass- ports to such British officers travelling in Ooreaj and shall provide such escort for their ' protection as may be necessary. 3. The Consular officers of both eoiintries shall exercise their functions on receipt of due authorization from the Sovereign or Government of the country in which they respectively reside, and shall not be permitted to engage in trade. AETIOLE III. 1. Jurisdiction over the persons and property of British subjects in Corea shall he vested exclusively in the duly authorised British judicial authorities, who shall hear. [107] "" ^ ^ ^ ' ' ? 2 ' and determine all oases brought against British subjects by any British or other foreign subject or citizen without the intervention of the Corean authorities. , , 2. If the Corean authorities or a Oorean subject make any cbay^e pr coinpja*ny against a British subject in Corea, the case shall be heard an4 decided by tne arwibix judicial authorities. , „io^«l 3. If the British authorities or a British subject make any charge or compiainc against a Corean subject ' in Corea, the case shall be heard and decided by tne *^orean . authorities. • j j • i, i 4. A British subject who commits any offence in Corea shall be tried and punisnea by the British judicial authorities according to the laws of Great Britain. -r •+• i 5. A Corean subject who commits in Corea any offence against a ±!ritisli subject shall be tried and punished by the Corean authorities according to the laws ot 6. Any complaint against a British subject involving a penalty or coiifiscation by reason of any breach either of this Treaty, or of any regulation annexed thereto, or bt any regdation that may hereafter be made in virtue of its provisions, shall.be brought befpre the British judicial authorities for decision, and any penalty imposed, and all property, confiscated in such cases, shall belong to the Corean Government. 7. British goods, when seized by the Corean authorities at an open port, shall be put' under the seals of the Corean and the British Consular authorities, and shall be detained by the former until' the British judicial authorities shall have given their, decision. If this decision is in favour of the owner of the goods, they shall be immediately placed at the Consul's disposal. But the owner shall" be _ allowed^ to receive them at once on depositing their value with the Corean authorities pending, the decision of the British judicial authorities. 8. In all cases, whether civil or criminal, tried either in Corean or British Courts in Core% a properly authorized official of the nationality of the plaintiff or prosecutor shall be allowed to attend the hearing, and shall be treated with the courtesy due to his position. He shall be allowed, whenever he thinks it necessary, to call, exiamine,' and cross-examine witnesses, and to protest against the proceedings or decision. 9. If a Corean subject who is. charged with an offence against the laws of his country takes rdluge on premises occupied by a British subject, or on board a British merchant- vessel, the British Consular authorities,, on receiving an application from the Corean authorities, shall take steps to have sUch person arrested and handed over to the latter for trial. But, without the consent of the proper British Consular authority, no Corean officer shall enter the premises of any British subject without his consent, or go on board any British ship without the consent of the officer in charge. 10. On the demand of any competent British Consular authority, the Corean authorities shall arrest and deliver to the former any British subject charged with a criminal offence, and any deserter from a British ship of war or merchant-vessel. AETICLB IV. 1. The ports of Chemulpo (Jenchuan), Wonsan (Gensan) and Pusan (Fusan), or, if the latter port should not be approved, then such other port as may be selected in its neighbourhood, together with the city of Hanyang and of the town of Yanghwa Chin, or such other place in that neighbourhood, as may be deemed desirable, shall, from the day on which this Treaty comes into operation, be opened to British commerce, 2. At the above-named places British subjects shall have the ri^ht to rent or to ■ purchase land or houses, and to erect dwellings, warehouses, and factories. They shall be allowed the free exercise of their religion. All arrangements for- the selection, determination of the limits, and laying out of the sites of the foreign Settlements, and ' for the sale of land at the various ports and places in Corea open to foreign trade, shall be made by the Corean authorities in conjunction with the competent Foreign' authorities. , : ; 3. These sites shall be purchased from the owners and prepared for oCcup&,tion by • the Corean Government, and the expense thus mcurred shall be a first charge on the proceeds of the sale of the land. The yearly rental agreed tipon by the COrean autho- rities in conjunction with the foreign authorities shall be paid to the former, who shall retain a fixed amount thereof as a fair equivalent for the land tax, and the remainder- ' together with any balance. left from the proceeds of land sales, shall belong to a municipal fund to be administered by a Council, the constitution of which shall be determined hereafter by the Corean authorities in conjunction with the competent foreign authorities; ^ ^ . .. ''4. British subjects may rent or purchase land or houses beyond the limits of the foreign Settlements, and within a distance of 10 Corean Zi f rom the same. But aU land so occupied shall be subject to such conditions as to the observance of Corean local Regulations and payment of land tax as the Corean authorities may see fit to impose. 5. The Corean authorities will i^et apart, free of coist, at each of the places open to trade, a suitable piece of ground as a foreign cemetery, upon which no rent, land tax, or other charges shall be payable, and the management of which shall be left to the Municipal Council above mentioned. ' 6. British subjects shall be allowed to go where they please without passports within a distance of 100 Corean 7i from any of the ports and places open to trade, or withiii such limits as may be agreed upon between the competent authorities o^ both countries. British subjects are also authorized to travel in Corea for pleasure or for purposes of trade, to transport and sell goods of all kinds, except books and other printed matter disapproved of by the Corean Government, and to purchase native produce in all parts! of the country under passports which will be issued by their Consuls and countersigned or sealed by the Corean local authorities. These passports, if demanded, must be pro- duced for examination in the districts passed through. If the passport be not irregular, the bearer Avill be allowed to proceed, and he shall be at liberty to procure such means of transport . as he may require. Any British subject travelling beyoii,d the limits above named without a passport, or committing when in the interior any offence, shaU be arrested and handed over to the nearest British Consul for punishment. Travelling without a passport beyond the said limits will render the offender liable to a fine not exceeding 100 Mexican doUars, with or witihout imprisonment for a term not exceeding one month. ' 7. British subjects in Corea sha,ll be amenable to such municipal, police, and other regulations for the m^intenaiice of peace, order, and good government as may be agreed upon by the competent authorities of the two countries. AETICLE V. 1. At each of the ports or places open to foreign trade, British subjects shall be at full liberty to import from any foi-eign port, or from any Corean open port, to sell to Or to buy from any Corean subjects or others, and to export to any foreign or Corean open port, all kinds of mierchandize not prohibited by this Treaty, on paying the duties of the Tariff annexed thereto. They may freely transact their business with Corean sub- jects or others without the intervention of Corean officials or other persons, and they may freely engage in any industrial occupatibn. 2. The owners or consignees of all goods imported from any foreign port upon which the duty of the aforesaid Tariff shall have been paid ' shall be entitled, on re- exporting the same to any foreign port at any time within thirteen Corean months from the date of importation, to receive a drawback certificate for the amount of such import duty, provided that the original packages containing, such ^oods remain intact. These drawback certificates shaU either be redeemed by the Corean Customs on demand, or thgy shall be received in payment of duty at any Corean open port. 3. The duty paid on Corean goods, when carried from one Corean open port to another, shall be refonded'at the port of shipment on production of a Customs certificate shpvring that the goods have arrived at the port of destination, or on satisfactory proof . being produced of the loss of the goods by shipwreck. 4. All goods imported into Corea by British subjects, and on which the duty of the Tariff annexed to this Treaty shall have been paid, may be conveyed to any Corean open port free of duty, and, when transported into the interior, shall not be subject to any additional tax, excise or transit duty whatsoever in any part of the country. In like manner, full freedom shall be allowed for the transport to the open ports of all Corean commodities intended for exportation, and such commodities shall not, either at th-e place of production, or when being conveyed from any part of Corea to any of the opeji ports, be subject to the payment of any tax, excise or transit duty whatsoever. 5. The Cprean Government may charter British merchant- vessels for the con- veyance of goods or passengers to unopened ports in Corea, and Corean subjects shall have the same right, subject to the approval of their own authorities. ^. Whenever the Government of Corea shall have reason to apprehend a scarcity of food within the kingdom. His Majesty the King of Corea may, by Decree, teinporarily prohibit the export of grain to foreign countries from any or all of the Corean open ports, and such prohibition shall become binding on British subjects in C56rea on the expiration of one month from the dait6 dtf whi^h it shall have bees 4 omom^'mwrn.vijmm by the OQreau authorities to the Batish Ooasul at the port ©onqewed, but shall not remain longer in force thanis absolutely necessary:. _ i AH British ships shaU pay tonnage dues at the rate of S@ cents {mM^sai) per register ton. One such paynient will entitle a vessel to visit any or all ot ttie open ports in Corea during a period of four months without further charge. All toniia^ dues shaU be appropriated for the purposes of erecting lighthouses and beacons, ajd placing buoys on the jQorean coast, more especially at the approaches to the open ports, and in deepening or otherwise improving the anchorages. No tonnage dijes shaii m charged on boats employed at the open ports in landing or shipping cargo. 8. In order to carry into effect and secure the observance of the provisions ot this Treaty, it is hereby agreed that the Tariff and Trade Eegulations hereto annexed;shall come into operation simultaneously with this Treaty. The competent authonti^ of the two countries may, from time to time, revise the said Eegulations with a view ±© the insertion therein, by mutual consent, of such modifications or additions as expen^j^. shall prove to be expedient. AKTICLE VI. Any British subject who smuggles, or attempts to smuggle, goods into any Coreaia port or place not open to foreign trade shall forfeit twice the value of such goods, and ' the goods shall be confiscated. The Corean local authorities may seize such goods, and may arrest any British subject concerned in such smuggling or attempt to smuggle They stall immediately forwai-d any person so arrested to the nearest British Consul for trial by the proper British judicial authority, and may detain such ^oods until thi case bhajl have been finally adjudicated. ARTICLE VII. 1. If a British ship be wrecked or stranded on the coast of Corea, the loefll authorities shall immediately take such steps to protect the ship and her cargo frofii plunder, and all the persons belonging to her from iU-treatment, and to render suoh other assistance as may be required. _ They shall at once inform the nearest British Consul of th^ occurrence,, and shall furnish the shipwrecked persons, if necessary, with means of conveyance to the nearest open port. 2. All expenses incurred by the Government of Corea for the rescue, clothing, maintenance, and travelling of shipwrecked British subjects, for the recovery of the bodies of the drowned, for the medical treatment of the sick and injured, and for the burial of the dead, shall be repaid by the British Government to that of Corea, 3. The British .Government shall not be responsible for the repayment of the expenses incurred in the recovery or preservation of a wrecked vessel, or the property belonging to her. All such expenses shall be a charge upon the property saved, ana, shall bo paid by the parties interested therein upon receiving delivery of the same. 4. No charge shall be made by the Government of €orea for the expenses of the Government officers,' local functionaries, or police who shall proceed to the wreck for the travelling expenses of officers escorting' the shipwrecked men, nor for the expensesi of official oorrespondenee. Such expenses shall be borne by the Corean Government. 5. Any British merchant-ship compelled by stress of weather or by want of fuel or provisions to enter an unopened port in Corea shall be allowed to execute repairs and to obtain necessary supplies. All suoh expenses shall be defrayed by the luaster of the vessel. , ' ARTICLE VIII, 1. The ships of war of each country shall be at liberty to visit all the ports of the other. They shaU enjoy eyery facility for procuring supplies of aU kinds or for making repairs, and shall not be subject tp trade or harbour regulations nor be liable to the payment of duties or port charges of any kind, ' 2 When British ships of var visit unopened ports in Corea, the offibers and men may land, but shaU not proceed, intq the interior unless they are provided with psjSsporxs* 3. Supplies of all kinds for the use of the British navy may be landed at the open ports of Corea and stored m the custody of a British officer, without the pavment rf ?X1foreantuLriLr' "^^'" "^ "''' '"^ ^"^"^^^'^ ^^^^^ ^^^ *^^ ^ 'p- ^-ty 4. The Corean Government will afford all the facilities in their power to shfm oSSn'^atm Government which may be engaged in rnaking surve^ g . 5 ARTICLE IX. 1. The idfritisli ^rafcliosities and British, suhjeot's in Corea shall he allowed to emij^y Cfctfean suhjects as teachers, iaterpreteirs, servants, or in any other lawful capacity, without any restriction on the part of the Corean authorities ; and, in like liaanner, no E^trictions shall he placed upon the employment of British subjects by Corean authorities and subjects in any lawful capacity. St Suhj:eots'of eith.er nationality who may proceed to the country of the other to stadj^ii^s laiigliage, jStOTsiiture, laws,, arts, or industries,, or for the purpose of scientific' Ti^ji^aif ch, shalx he afforded evei^^ reasonable facility for doing so. ARTICLE X, Sfc- i» hfereby stipulated that the Government, public ofBcers, and subjects of Sei? IMfennite' Majesty ^all, from the day on which this Treaty comes into operation^ participate in all privileges, immunities^ and advantages, especially in relation to' ittspc^' or export- diitaes on goods and manufactures, which shall then have been gWKrted or may thereafter be granted by His Majesty the Eng of Corea to: the' Government,, public officers, or subjects of any other PoWer, ARTICLE XL Ten years from the date on which this Treaty shall come into operation, eithef of tkaHighfComtraoting Parties may, on giving one year's previous notice to the other, deHteind af revision of the Treaty or of the Tariff annexed thereto, with a view to the insertion therein, by mutual consent, of such modifications as experience shall prove to, bfe d^irable. ARTICLE XII. T. TMs T^ty is- drawtL up in the English and Chinese laangaagfes, both of which versions have the same meaning, but it is hereby agreed that any difference which may arise as to' interpretation shall 'be determined by reference to the English text. 2. Eor the present all official communications addressed by the British authontleSi^ to those of Corea shall be accompanied by a translation into Chinese. ARTTOLE Xill. The present Treaiiy shall be ratified by Her Majesty the Queen of the United Kingdom of Gi-eat Britain and Ireland, Empress of India, and by His Majesty the Eiiig of Corea, under their hands and seals; the ratifications shall be exchanged at* Hianyang (Soul) as soon as- possible, or at latest within one year ftom the date of sigiiature, and the Treaty, which shall, be published by both Governments, shall come into operation on the day on which the ratifixjations are exchanged. In witnessnrhea'eDf the respective Plenipotentiaries above named have signed the present Treaty, and have thereto affixed their seals. Done in triplicate at Hanyang, this twenly-sixth day of November, in the year feighteen hundred and eighty -three, corresponding to the twenty- seventh day of the tenth month of the. four h«.ndred and ninety-second year of the Corean era, being the ninth year of the Chinese reign Euang Hsii. (L.S.) HARRY S. PARKES. (L.S.) .Signature in Chiuese of MiN YoNGrMoK, the Corean Plenipotentiary. Regulations under which British Trade is, to be conducted in Corea, I. — Entrance and Clearance of Vessels. L Within, forty-eight nours ''exclusive of Sundays and holidays) after the arrival of. a British ship in a Corean port, the masteir shaU deliver to the Corean Customs aiBfehoritie& the .receipt of the British Consul showing that he has deposited the ship's papers at the British Consulate, and he shall then make an entry of his ship by handing 6 in a written paper stating the name of the ship, of the port from which she comes, of her master, the numher, and, if required, the names of her passengers, her tojmage, ana the number of her crew, which paper shall be certified by the master to be a true statement, and shall be signed by him. He shall, at the same time, deposit a YJ™p manifest of his cargo, setting forth the marks and numbers of the packages and ttieir contents as they are described in the biUs of lading, with the names of the persons to whom they are consigned. The master shall certify that this description is correct, and shaU sign his name to the same. When a vess^l has been duly entered, the Customs authorities will issue a permit to open hatches, which shall be exhibited to the Customs officer on board. Breaking bulk without haying obtained such permission will render the master liable to a fine not exceeding 100 Mexican dollars. 2. If any error is discovered in the manifest, it may be corrected within twenty, four hours (exclusive of Sundays. and holidays) of its being handed in, without the payment of any fee, but for any alteration or post entry to the manifest made after that time a fee of 5 Mexican dollars shall be paid, i,?- 3. Any master who shall neglect to enter his vessel, at the Corean Custom-house within the time fixed by this Regulation shall pay a penalty not exceeding 50 Mexican dollars for every twenty-four hours that he shall so neglect to enter his ship. 4. Any British vessel which remains in port for less than forty-eight hours (exclusive of Sundays and holidays) and does not open her hatches, also any vessel driven into port by stress of weather, or only in want of supplies, shall not be required to enter or to pay tonnage dues so long as such vessel does not engage in trade. 5. When the master of a vessel wishes to clear, he shall hand in to the Customs authorities an export manifest containing similar particulars to those given in the import manifest. The Customs authorities will then issue a clearance certificate and return the Consul's receipt for the ship's papers. These documents must be handed into the Consulate before the ship's papers are returned to the master. 6. Shbuld any ship leave the port without clearing outwards in the manner above prescribed, the master shall be liable to a penalty not exceeding 200 Mexican dollars. ♦ 7. British steamers may enter and clear on the same day, and they shall not be required to hand in a manifest except for such goods as are to be landed or transhipped at the port of entiy. II. — Landing and Shipping of Cargo, and Payment bf Duties, . 1. The importer of any goods who desires to land them shall make and sign an application to that effect at the custouj- house, stating his own name, the name of the ship in which the, goods have been imported, the marks, numbers, and contents of the packages and tbeir values, and declaring that this statement is correct. The Customs authorities may demand the production of the invoice of each consignment of merchandize. If it is not produced, or if its absence is not satisfactorily accounted ior, the owner shall be allowed to land his goods on payment of double the Tariff duty, but the surplus duty so levied shaU be refunded on the production of the invoice. 2. All goods so entered may be examined by the Customs officers at the places appointed for the purpose. Such examination shall be made without delay or injury to the merchandize, and the packages shall be at once restored by the Customs authorities to their original condition, in so far as may be practicable. 3. Should the Customs authorities consider the value of any goods paying an ad valorem duty as declared by the importer or exporter insufficient, they shall call upon him to pay duty on the value determined by an appraisement to be made by the Customs appraiser. But should the importer or expori;er be dissatisfied with that appraisement, he shall within twenty-four hours (exclusive of Sundays and holidays) state his reasons for such dissatisfaetion td the Commissioner of Customs, and shall appoint an appraiser of his own to make a re-appraisement. He shall then declare the value ot the goods as determined by such re-appraisement. The Commissioner of Customs will thereupon, at his option, either assess the duty on the value determined by this re-appraisemcnt, or will purchase the goods from the importer or exporter at the price thus determined, with the addition of 5 per cent. In the latter case the purchase-money shall be paid to the importer or exporter within five doy& from the date on which he has declared the value determined by his own appraiser. 4 Upon all goods damaged on the voyage of importation a fair reduction of dtitv shall be-allowed, proportionate to their deterioration. If any disputes arise as to the amotint of such reduction, they shall be settled in the manner pointed out in the pre- ceding clause. 5. All goods intended to be exported shall be entered at the Corean Custom-house before they are shipped. The application to ship shall be made in writing, and shaU state the name of the vessel by which the goods are to be exported, the marks and number of the packages, and the quantity, description, and value of the contents. The' exporter shall certify in writing that the application gives a true account of all the goods contained therein, and shaU sign his name thereto. 6. No goods shall be landed or shipped at other places than those fixed by the Corean Customs authorities, or between tiie hours of sunset and sunrise, or on Sundays or holidays, without the special permission of the Customs authorities, who will be entitled to reasonable fees for the extra duty thus performed. 7. Claims by importers or exporters for duties paid in excess, or by the Customs authorities for duties which have not been fully paid, shall be entertained only when made within thirty days from the date of payment. 8. No entry will be required in the case of provisions for the use of British ships, their crews and passengers, nor for the baggage of the latter which may be landed or shipped at any time after examination by the Customs oflS.cers. 9. Vessels needing repairs may land their cargo for that purpose without the payment of duty. AU goods so landed shall remain in charge of the Corean anthorities, and aU just charges for storage, labour, and supervision shall be paid by the master. But if any portion of such cargo be sold, the duties of the Tariff shall be paid on the portion so disposed of. , 10. Any person desiring to tranship cargo shall obtain a pemiit from the Customs authorities before doing so. Ill; — Protection of the Revenue.- 1. The Customs authorities shall have the right to place Customs officers on ,board any British merchants-vessel in their ports. All such Customs officers shall have access to aU. parts of the ship in which cargo is stowed. They shall be treated with civility, and such reasonable accommodation shall be allotted to them as the ship affords. I 2. The hatches and aU other places of entrance into that part of the ship where . cargo is stowed may be secured by the Corean Customs officers between the hours of sunset and sunrise, and on Sundays and holidays, by affixing seals, locks, or other fastenings, and if any person shall, without due permission, wilfully open any entrancls , that has been so secured, or break any seal, lock, or other fastening that has been ' affixed by the Corean Customs officersj not only the person so offending, but the master of the ship also, shaU be liable to a penalty not exceeding 100 Mexican dollars. 3. Any British subject who ships, 'or attempts to ship, or discharges, or attenipts to discharge, goods which have not been duly entered at the custom-house in the manner above provided, or packages containing goods different from those described in the import or export permit appHcatioh, or prohibited goods, shall forfeit twice the value of such goods, and the goods shall be confiscated. 4. Any person signing a false declaration or certificate with the intent to defraud the revenue of Corea shall be liable to a fine not exceeding 200 Mexican dollars. 5. Any violation of any provision of these Regulations, to which no penalty is specially attached herein, may be punished by a fcie not exceeding 100 Mexican dollars. Note. — ^All documents required by these Regulations, and all other communica- tions addressed to the Corean Customs authorities, may be written in the English language. (L.S.) HARRY S. PARKES.V (L,S..) Signature in Chinese of MiN ToNQ-MoKj the Corean Plenipotentiary. [107] 8^ IMPORT TAMim. [Classified according to Bate of Duty.] C1.ASB I. Agricultural implements. £0(^8, ibapg, laid clmts. BiijijIioAt being eold a^d silver refilled. ' Coins, gold, and silver. Fire engines, Msdels ^ inventions. PspMns Ijags, packing mnlting, tea-lead, and njpes for |)9«ki^ goods. P|an|ts, t^-eps, g,ii4 sUnibsj of iiU kinds. Sam;^l6s in reasonable quantities. Scientific instruments, as physical, mathematical, meteo- ;S9j«iiWSJ» and syrgieal instruments and their ap- pliances. Tra.vellers' baggagt". Types, new and old. Class II. •^J^f?*"^ (^oois suhjeei fo an ad yajja-em Duty of 5 per cent. Alutn. Ai^bprs and c}>ain«. Bark for tanning. Bambgp, split. or not. , . ' ' B^s, peas, ftnd puise, all kinds. » •' \ > * " B(>»e8i ■■ -;/.'.!>,♦■?'■.■■. Bn^^tJ finAtiUes, , '• ' CMipWf crudp. Coal aqd coke. Cdtton, raw. Djfilga and i»edioines, all liinds. Fish, fresh. Flsx, hemp, and jute. Flitt^, Flettr and aieftl, all kin^s. . Fyftit, fresh, ^ l^ind?* Grain and com, all kinds. Guano and manures, all kinds. HMeft'aafl skins, raw and utid*fcs«6d. Horns an^ Tmi% ftU kinds ^ot otM^Wisp provided for. KpfospRe ftfld petroleum and othey mineral oils. Lanterns, Jiaper, Lim«. ? : Matches. Matting, floor, Chinese and Japanese, coir, &o eommon qualities. , '' Metals, all kinds, in pig, block, ingot, slab, bar, rod, plate, sheet, hoop, strip, baq^, aw fljit, Jflnd angle iron, ola and scran iron. • 1 » B>p Oilc^fcgi '- - Oil, wood (2"Mn^ mX Paper, common qualities. Pepper, unground. Pitch and tar. Rattans, split or not. Scales and balances. Seeds, all kinds. Soap, common qualities. Soy, Chinese and Japanese. Twine and thread, all kinds excepting in silk. Pmbrellas, paper. Vegetables, fresh, diied, find Saltec^. Wool, sheep's, raw. Yarns, aM kinds, in cotton, woal, heipp, &c. All unenumeiated ai-ticles, raw or unmanufiifctMred. Class III. Im^Wt Q$ade subject to an ad valorem Z)« Charcoal. Chemicals, all kinds. Gooooiis. Cement, as Portland aud other kinds. Copiidage atid rope, all kinds a^ siees. < Clothing and wearing apparel of all kind*, hats, boots, shoes, Ac. Cotton manufactures, all kindd^ Cotton and woollen mixtmws, i^l kinds. Cotton and silk mixtures, all kinds. Pyes, colours, and paipts, paint oils, and- materials used for mixing p:\iatS. Earthenware. Fans. I'^eathers. Felt. Fish, dried and salted. Floor rugs, all UiadSi Foil, tin, copper, and all other kinds except gold and silver. Fruits, dried, salted, or preserved. Gamboge. GIbss, window, plain, and coloured, all qualities. Grass clpth and aU tp^itiles in hemp, jutg, &c. Ilair, all kinds except human. Hides and skins, tanned and dressed. Isinglass, all kinds. Lamps, all Jtinds. Leatber,_ all ordinai'j? kinds, plain. Linen, linen and cotton, linen and wboUefi, linen and silk mixtures, gl'fey, white, or printed. ■: Matting, superior quality, Japanese " tatamis," &e. Meat, qlri^d aiid salted. Metalsi, all kiadB in pipo and tube, 'corrugated or galTfli»i»ied, wire, steal, tih jdateS, nipkel, ijlatlna, ' quicksilver, German silver, tutenagne, or >vhite ' . copper, yellow ^letal, unrefined gold and silver Metal manufectures, all kinds, as nails, screws tools machmcBy, raihvay plant, and hardware. ' ' Slusquito netting not made of silk. Needles and pins. Oils, vegetable, all kinds. Oil and floor cloth, all kinds. Paper, all kinds, not otherwise provided for. Planks, soft wood. -PefeelflriajeomiHon quality. Rosin, Salt. Sapan wood. Sea products, as seaweed, b^che de mer. See Silk, raw, reeled, thrown floss or waste. Silk manufactures not otherwise provided for. Spectacles. Spirits in jars. f Stationery and writing materials of all kinds, blank books, &c. Stones and slate, cut and dressed. Sugar (brown and white), all qualities, molasses, and syrups. Sulphur. Table stores, all kinds, and preserved provisions Tallow. Tea Umbrellas, cottton. Umbrella frames. Viatfnish. VermiceHi. Wasx, bees^ or v^getabk. Wax olotb. - " Woods and timber, soft. Woollen manufaptwes, all kinds. Woollen and silk mixtures, all kinds. All uneniunerated 'articles partly manufactured, Cl,ASS IV. > Import Goods subject to an ad valorem Duty of 10 per cunt. Beer, porter, and oider. Campiior, refined. Carmine. Carpets, superior qualities, as Brussels, Kidderminster, and other kinds not enumerated. Clocks, and parts thereof. Clothing; made wholly of silk. ConfeetfeAaries and sweetmeats, all hinds. • Explosives used for mining, &c. (imported under speoiftl permit). Foil, gold and silver. Furniture of all kinds. Glass, plate, silvered or unsilvored, framed or un- franaed. Glassware, all kinds. Hair, human. India-inibber, manufactured or not. Leather, superior kinds, or stamped, figured, or colou'ped. liCathcF manufactures, all kinds. Lacquered-ware, common. Materials for seals, &c. Musical boxes. Musical instruments, all kinds. Musquito netting made of silk. Paper, coloured, fancy, wall and hanging. Photographic apparatus. Planks, Hardwood. • Plate^"wafe, all kinds. Pictures, prints, photographs, engravings, all kinds, framed^or unlramed. Porcelain, superior quality. 8 iddlery and harness. Silk thread, or floss silk in skein. , Silk Bianufacturcs, as gauze, crape, Japanese amber lustrings, satins, satin dainnsks, figured satins, •Japanese white silk ("habutai"). ' Soap, superior qualities. Sugar candy. Telescopes and binocular glnsses. Tooth f owder. ) Trunks and portmanteaux. Umbrellas, silk. Vermilion. ' Watches and parts thereof in common metal, nickel, or silver. Wines in wood or bottle, all kinds. Wood or timber, hard. All uneritmierated articles completely manufactured. Class V. Import Ooods subject to an ad valorem Duty of 20 per , cent, Amber. Arms, fire-arms, fowling pieces, &c., issqgsscig4, VOSiir special permit. / 4*ft|ftBial flowers. Birds' nests. Carpets, velvet. Carriages. Cochined. Coral, manufactured or not. Embroideries in gold, silver, oi: silk. Enamel-ware. Fireworks. Furs, superior, as sable, sea 6t£ei5, seal, o,ttcr, benvcr, &c. Ginseng, red, white, crude, and clarified. Hair ornaments, gold and silVc-r. Incense, sticks. Ivory, manufaotuiEed or not. Jade-ware. Jewellery, real or imitation',. Lacquered- ware, superior. JMusk. Pearls. ; Perfumed and scents, Plate, gold mid silver. Precious Stones. Rhinoceros horns. Scented woods, all kinds. Spices, all kinds. Spirits and liqueurs in wood or bottle, all liindte.' Tobaccoj. all forms and kinds. Tortoise shell, mamifac.tw'cd or not. Velvet, silk. Watches, and parts thereof, in goidanj gilt. Works of Art. Class VI. Prohibited G.oeds^ Adulterated drugs oi- medicines. Arms, muniiions, and implements of war, as ordnaaice or cannon, shot and shell, firc-a;:ni8 of all kipds, cartridges, side-arms, spears, or pikes, saltpetre, gun- powder, guncotton, dyn;iniite, and other explosive substances. ^ The Coreiin autliorities will grant special permits for the importation of arms, flre-arms» and ammunition for purposes of sjjort or self defence, on satisfactory proof being furnished to thorn of the bmd fide cliaracter of the application. Counterfeit coins, all kinds. Opium, except inedicinul opiiun. Foreign ships, when sold in Ccrea, will pay a duty of 25 cents per ton on sailing vessels, and 50 ceats per toll on steamers, (L.S.) BEAEEY S. EARKES, (L,S.) Signature in Chinese of MIN Y"OjS^Gf-MOK, Oorean Plenipotef^iary. [107] C 2 10 IMPORT TARIFF. [Arranged alphabetically."] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 16 16 17 18 19 20 21 22 23 24 25 26 27 28 29 SO 31 32 33 84 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 63 54 65 56, 67 -5^ 59 60 Agricultural implements . . • • • • • • • • Alum .. .. .. ,. •• •• Amber .. ,, .. •• •• •• •• Anchors and chains . . . . . •, • • • _ • • • • Arms, ammunition, fire-arms, fowling-pieces, or side-arms, imported under permit of the Cprean Government for sporting purposes or for self defence Artificial flowers, . . . . . ' . . • • Bamboo, split or not . . Bark for'tannin^, .. . . . . > . . • • Ijeans> peas, and pulse, all kinds' ^ Beer, porter, and cider Beverages, such as lemonade, ginger beer, soda and mineral waters Birds' nests . . . . Blankets and rugs . . . . JjOIIcS •• aa !■ •• •• *■ ** Books, maps, and charts . . Bricks and tiles . . Bullion, being gold or silver, refined Button^, bucMes, hooks and eyes, &c. ' Camphdr, crude . . „ refined . . . . . . . . • • Candles Canvas . . Carmine ;Carpets of jute, hemp, or felt, patent tapestry . . .. .. „ superior quality, as Brussels, Kidderminster, and other kinds not ( „ velvet .. ., .. .. .. .. .1 Carriages . , .. . . . . Cement, as Portland and other kinds Charcoal . . , Chemicals, all kind* . . .... Clocks and parts thereof . . ... Clothing and wearing; apparel, all kinds, bats, boots and shoes, Sic. ), ,, . ' made wholly of silk 'Coal and coke .. ,.. Cochineal Cocoons Coins, gold and silver Confectionaries and swerjtmeafe, all kinds Coral, manufaotuiired or Jiot Cordage and rcpe,. all kinds and sizes Cotton, raw . . , . . Cotton mann&ctures, al kinds Cotton and woollen mixitures, all kinds Cotton and silk mixtures, all kinds . , Cutlery, all kinds Drugs, all kinds . . ., Dyes, colours,', and paints , paint oils, and materials used for mixing paints pyiirthenwa*e .. ,. ..,'.. .. .. Einbroideries in gold, silv er, or silk *. ! .', '.'. Enamel ware ■i-^i. !•• •• •" •• •• J^ixplosives used for minina;, &c,, and imported under special permit Fans, all kinds .. £■ ' i" » l Feathers-,. all kinds Till .-•O i«»' ■■ ■• !• Felt .. •w~>t ** ■•• ■• •• ■• •• liire engmes Fireworks. • Fish, fresli „ • dried and saltedS '. * .'. ', ', ', ', '. '. Flax, hemp, and jute. *i ,', Flmts .. special itcd. 11 61 62 63 64 65 66 67 68 69 ,70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 103 104 105 106 107 108 109 110 111 112 113 114 115 116 117 ,118 119^ 120 121 122 123 124 125 126 127 128 129 130 181 132 Floor rugs, all kinds . . . . . . . . . . Flour and meal, ..... Leather, all ordinary kinds, plain .. .. .. .. .. •• „ superior kinds, and stamped,, figured, or coloured „ inanufactures, all kinds . . . . Lime .. .. •■ .. *• •■ •" •■ ■• Linen, linen and cotton, linen and woollen mixtures, linen and silk mixtures, all kinds .. .. '• •• •! ■* ** '* Matches .. .. .. .. ••__ •• Matting, floor, Chinese, Japanese, coir, &o., common qualities „' superior qualities, Japanese tatamis, &o. Meat, fresh . . . . . . . ■ ■ • .... „ dried and salted Medicines, all kinds not otherwise provided for . . . . ■ . _ ' • . Metals, all kinds, in pig, block, ingot, slab,, bar, rod, plate, sheet, hoop, strip, band and flat, f- *"'' angle-iron, old and scrap iron . . _. . • '. ■ Metals, all kinds, in pipe or tube, corrugated or galvanized, wire, steeil.tinrplates, quicksilver, nickel, platina, German silver, ydlow metal, tutenagrie; or white coj.'per, unrefined gold and silver . . . . . . " • . Metal manufactures, all kinds, as nails, screws, tools, machinery^ railway plant, and hardware .. .. .. .. •• •• •• ' Models of inventions . . . . . . . . • « Musquito netting, not made of silk . . ., made of silk Musical boxes Musical instruments, all kinds Mu^k .. .. «. •• •• '■ Needles and pins Oil-cake . . . • • • • • • • • • • ■ • Oils, vegetable, all kinds . . Oil, *ood (T'ung yu) .. .. .. .. .. •• . ■ Oil- and floor-cloth, all kinds , . . ■ • 'j.i' ■ • . Packing bags, packing matting, tea-lead, and lopcs for packing goods ... Papcif, coiiimon qualjties . . . . . • • . . • , „ aE kinds, not otherwise provided for . . ,, colo\ired, fancy, wall, and hanging .. .. ... Pearls . . . . • • • • • • • « Pepper, unground .. .. •• •• •• Perfiimes and scents .» .. .. •• •• •• Photographic apparatus . . . . . • Pictures, prints, photographs, engravings, all kinds, framed or unframed . . Pitch and tar . . . . . . • • • • • • Planks, soft i. „ hard ... . . . . ■ • Plants, trees, and shrubir, all kinds . . ., 10 7J- 6 71 10 20 H 20 ^ 10 10 5 5 ^ 5 10 20 5 6 20 10 ■ 71 '2 20 20 20. 5 10 20 71 '2 5 71 '2 10 10 5 5 5 5 71 5 Free 7i 10 10 10 20 V 7i ■ 5 n 5 71 '2 Free , 5 71 '2 10 20 5 20 10 10 5 H 10 Free. 12 m. 133 184 135. 136 137 138 189 140 141 142 148 144 145 146 147 148 149 150 151 152 153 154 155 156 157 158 159 160 161 162 163 164 165 166 167 168 169 170 171 172 173 174 175 176 177 178 179 180 181 182 183 184 185 186 187 188 189 190 191 192 193 194 195 196 197 198 Article. ' Plate, gold and silver .4 .• .. •• •• •• " Plated-ifewej all kinds ... !,iPoroelaia,. common qualitiesi .d .. ••• •• •• •■ „ ■ superior qualities- . . . • • • • • • • •• f Precioup stones, all-kinds, set or unset . . . • • • • • ■ ■ ! Rattans, split or not .. .. •• •• •• •• I Rhinoceros horns .. .. .• •• ' Rosin ,. ,. •• •• •• •• •• •• •• ' Saddler^ and harness . . . . • • • • • • • • Salt /.. .. •• •• •• ■• •• •• •* Samples in reasonable quantities . . . . . • • • • • • • Sapan wood .. .. .. •• •• ■• •• *■ Scales and- balances ., .. .. •• •• •• -• Scented wood, all kinds . . . . . . * . . _ • • • Scientifito. instruments, as physical, mathematieal, meteorological, and surgiorl, and ' their appliances , . . . . . . > • • • • • • 1. Seals, materials for . . . . . • . .^ . . . . • i Sea products, as seaweed, b^ch'e-de-mer, &c. . . . . • • • • ! Seeds, all kinds .. .. .. .• •• •• •• Silk, raw, reeled, thrown, floss or waste .. •• _ •• • Silk manufactures, as gauze, crape, Japanese amber lustrings, satins, satin damasks, figured satins, Japanese white silk (" nabutai") . . . . . . Silk manufactures not otherwise provided fbr . . Silk thread and floss silk in skein .. ! Soap, common qualities „ superior qualities Soy, Chinese and Japanese Spectacles .. ,. .. .. ,. .. .. !, Spices, dl kinds . . Spirits, in jars . , Spirits and liqueurs, in wood or bottle, all kinds . . • . . . . . Stationery and writing materials, all kinds, blank books, &c. Stones and slate, cut and dressed .. .. .. .... ,; . Sugar, brown and wliite, all qualities, molasses and syrups ► Sugar candy Sulphur .^Table stores, all kinde, and preserved provisions •Tallow.. .. .; *• •• •• •• •* ■• •• »• ,, : Telescopes and binoonlar glasses Tobacco, all kinds and forms Tortoise shell, manufactured or not . , ; . Tooth powder .. .. Travellei^s' baggage Trunks and portmanteaux . . Twine and thread, all kinds, excepting in silk . . Types, new and old .. ., Umbrellas, paper „ Cotton .. .. ., .. ,. .. [\ TT ,",, /""^ • ' Umbrella frames.. Varnish .^ .. ,. .. .. ." Vegetables, fresh,. Med, and salted . . Velvet, silk i Vermicelli .... Vermilion . , . , , • Watches, and parts th,ereof. in common metal, nickel, or «lvcr .. „ in gold or gilt ,'. ;". Wax, bees or vegetable , . . . . ■ „ doth Wines in wood or bottle, alt kinds .. Wood and timber, soft . . . . . . . . . . '[ wr "1 u . " ^"'■'^ •• •• •• ..'.'. V. [] Wool, sheep s, raw . . . . . . . . , ^ Woollen manufactures, all kinds Woollen and silk mixtures, all kinds .. .. '' .WorksofArt ,. .. ., .. .j Yams, all kinds, in cwrton, wool, hemp, kc. '.'. V. ',[ ]\ All unenumerated articles, raw or unmanufactm-ed .. .. ','. " ... partly manufactured .. ...,.". 3. completely manufactured foreign ships,, when .spld Jn Corea, will pay a duty of 25 cents per tott on sailinV vegselsi.and 50 cents per ton on steamers. ° I Advahremk, Rate of I)u*y* t . -1. > Per cen . 20 10 10 21) 5 20 n 10 H Free. n 5 20 Free. 10 5 7i ' s 10 7i 10 5 10 5 20 7-i 20 i '2 10 7i H n 7i '2 10 20 20 .10 Free. 10 5' Free. 5 7J- '2 10 7i 7i 5" 20 ,^* 10. 10 20. n 10 n 10 5 ;i 20 5 5 n 10 13 Prohibited Goods. Adulterated drugs or medicines. Arms, munitions, and implements of war, as ordnanoe or cannon, shot and shell, fire-arms of all kinds, cartridges, side-arms, spears or pikes, saltpetre, gunpowder, gunootton, dynamite, and other explosivie substances. The Corean authorities will grant special permits for the importation of arms, fire-arms, and ammunition for purposes of sport or self defence on satisfactory proof being furnished to them of the bondjide character of the application. Counterfeit coins of all kinds. Opium, except medicinal opium. Export Tariff. Class I. — Duty free export goods ; — Bullion, being gold and silver refined ; coins, gold and silver all kinds ; plants, trees and shrubs, aU kinds ; samples, in reasonable quantity ; travellers' baggage. Class li. — All other native goods or productions not enumerated in Class I will pay an ad valorem duty of 5 per cent. ThS ^portatian of red ginseng is prohibited. Rules. 1. In the case of imported articles the ad valorem duties of this Tariff will be jcalculated on the actual cost of the goods at' the place of production or fabrication, with the addition of freight, insurance, &o. In the case of export articles the ad palorem duties will be calculated on market values in Corea. 2. Duties may be paid in Mexican dollars or Japanese silver yen. 3. ^he above Tariff of import and export duties shall be converted, as soon as possible^ and as far as may be deemed desirable, into specific rates by agreement between the competent authorities of the two countries. (L.S.) HARRY S. PARKES. (L.S.) Signature in Chinese of MIN YONG-MOE, CWean Plenipotentiary, Protocol. The above-named Plenipotentiaries hereby niake and append to this Treaty the following three declarations : — , 1. With reference to Article III of this Treaty, it is hereby declared that "the right of extra-territorial jurisdiction over British subjects in Corea granted lay this .Treaty shaU be relinquished when, in the judgment of the British Government, the laws an^ legal procedure of Corea shall have been so far modified and reformed as to remove the objections which now exist to British subjects being placed under Corean jurisdiction, and Corean Judges shall have attained similar legal qualifications , and a similar independent position to those of British Judges. 2. With reference to Article IV of this Treaty, it is hereby declared that if the Chinese Government shall hereafter surrender the right of opening commercial establishments in the city of Hanyang, which was granted last yesir to Chinese subjects, the same right shall not be claimed for British subjects, provided that it be not granted by the Corean Government to the subjects of any other Power. 3. It is hereby declared that the provisions of this Treaty shall apply to aU British Colonies, unless any exception shall be notified by Her Majesty's Government to that of Corea within one year from the date in which the ratifications of this Treaty shall be exchanged. And it is hereby further stipulated that this Protocol shall belaid before the High Contracting Parties simultaneously- with this Treaty, and that the ratification of this Treaty shall include the confirmation of the above three declarations, for which, there- fore, no separate act of ratification will be required. In faith of which the above-named Plenipotentiaries have this day signed this Protocol, and have thereto affixed their seals. Done at Hanyang this twenty-sixth day of November, in the year eighteen hundred aiud eighty-three, corresponding to the twenty -seventh day of the tenth month of the four hundred and ninety-second^ year of the Corean era, being the ninth year of the Chinese reign Kuang Hsu. (L.S.) HARRY S. PARKES. (L.S.) Signature in Chinese of MIN YONG-MOK, Corean Plenipotentiary. ^ 3 ^ *§> Si * V Ob 00 s 2 § «« D H » '4 n > ^ £. H <^- s X s .^ o <» •-« Si R. & J? e^ p* ". §5 5 1 GD ►5' <^ g §! o o e s- JB 3 »■ W 3 CD ft ti« g S^ P o- •^ a •— • 00 00 O o r- r^ITNA. No. 2 (1880). /^ CORRESPONDENCE 3 EESPBCTING THE AGEEEMENT BETWEEN THE MINISTERS PLENIPOTENTIARY OF THE GOYERNMENTS OF GREAT BRITAIN AND CHINA SIGNED AT C HEE O O ON SEPTEMBER 18, 1876. [In continuation of " China No. 3 (1877)."] Presented to both Houses of Parliament by Command of Her Majesty, 1880. LONDON: PRINTED BY HARRISON AND SONS. [C— 2716.] Price 2d. L Correspondence respecting the Agreement between the Ministers Plenipotentiary of the Governments of Great Britain and China signed at Chefoo on September 13, 1876. [In continuation of " China No. 3 (1877)."] Sir T. Wade to the Marquis of Salisbury, — {Received April 6.) My Lord, Peking, January 31, 1880. I HAVE the honour to inclose copies of my correspondence with the Prince of Kimg on the subject of opium taxation. I shall submit to your Lordship some observations on this subject in a separate despatch. I have, &c. (Signed) THOMAS FEANCIS WADE. Inclosure 1. Sir T. Wade to Prince of Kung. Sir, Peking, November 10, 1879. AS the Ministers of the Tsung-li Yamen will have informed your Imperial Highness, I have been in communication with their Excellencies on various occasions since my return to Peking, upon the subject of opium taxation. The settlement of the question so much more nearly concerns the Government of Ohina than my own that I should not have been the first to approach it in discussion but for one reason, namely, that I feel bound to enable my own Government to meet the charge of behaving unfairly to Ohina in the matter of the agreement negotiated by me at Chefoo with the Grand Secretary Li in 1876. I returned home shortly after the Agreement was signed, and during the time I was in England, nearly two years, the Government was more than once called upon to state why the Agreement was not ratified. The question was asked in Parliament, and, out of Parliament, the Minister Kuo was used to complain that although ports and places of call, the immediate opening of which was stipulated in the Chefoo Agree- ment, had been .opened by China., England, in withholding the ratification of the Agree- jBent, had not fulfilled her part. I did not myself assume, when I signed the Agreement at Chefoo, that its formal ratification by my Sovereign would be necessary. The instrument in nine Articles signed by your Imperial Highness and the Earl of Elgin in 1860 was never formally ratified by the Queen, but effect was none the less given immediately to its provisions. The Chefoo Agreement was in its most essential conditions accepted by Her Majesty's Government. The Government would otherwise have formally disapproved my Bjote of the 30th September, 1876, in which I informed your Imperial Highness that I should report the Tiinnan affair finally closed. By this assumption of responsibility on my part and by my Government's approval of my action, the Chinese Government gained an advantage which, as I have taken [1562] B 2 occasion to remark to the Minister Kuo, appears to me to have been very imperfectly- appreciated. With reference to two clauses of the commercial section of the Agreement a certain difficulty has been made. To one of the conditions under this head, it was impossible for Her Majesty's Government to assent without the concurrence of the other Treaty Powers. All the Treaty Powers, England included, had for years been protesting against levy of li-kin upon imports between the port of entry and the transit duty barriers, as an infraction of Treaty. The district so described is at many ports considerable, and the sanction by any single Government, the British Govern- ment or any other, of a limitation of the area within which its imports should be exempt from li-kin, such as would make it no more than co-extensive with the port Settlements would be a very important concession to China. But it could avail China nothing unless it were agreed to by all alike. It was for this reason that, when signing the Agreement, I exacted a promise that all the Treaty Powers should be appealed to by the Tsung-li Yam^n, and that the port area should be defined by the Chinese and ' foreign authorities acting together. The Yamen did accordiagly appeal to the Repre- sentatives of tho Treaty Powers. It was a favourite argument with the Minister Kuo, that by the withdrawal of the li-kin coUectorate from the port Settlements, the Chinese Government had conceded a great advantage to foreign Powers. But he overlooked the fact that the Represen- tatives of foreign Governments had been long complaining of the action of these very coUectorates, so far as foreign imports were concerned, as illegal. Nor was the Minister apparently aware that Shanghae was the only port at which the coUectorate was so withdrawn from the foreign Settlement, and that its withdrawal at that port was not in satisfaction of the Chefoo Agreement at all, but was due to the demand of the Minister of Germany, who claimed its removal as a Treaty right. Neither he nor any other of the foreign Ministers had at the time, or has as yet, assented to the limitation of the port area, which, in the Chefoo Agreement, I undertook to recommend my own Government to adopt. The question of li-kin taxation has still to be considered by the other Treaty Powers. The above matter, as I have observed, is one of common iuterest. There was another condition in the Agreement which, it is true, concerned the British Govern- ment alone ; namely, that I should engage to propose that when the area of exemption rom li-kin had been by common consent defined, the li-kin on opium should be col- lected by the maritime Customs instead of, as heretofore, by the li-kin colleptorate. This was a change which could be of no possible advantage to my country ; it was proposed in the interest of China, but the suggestion emanated from me, and not from the Grand Secretary Li. The Grand Secretary, after much discussion, had admitted that in claiming, as by Treaty I claimed, exemption fi-om li-kin for all imports, opium excepted, until they should reach a barrier existing in 1842, I was not unreasonable. On the other hand, I did not deny the liability of opium to li-kin, and my obiect mthe proposed new arrangement for collection of the li-kin, was to secure to the Chinese Government the revenue on opium of which I foresaw it could scarce fail to lose more or less when the li-kin coUectorate came to be banished from the port areas now to be marked off. ^ 1 was thinking, I confess, when I made the proposition, of the li-kin on opium as It was then assessed; assessed^ that is, at rates imposed apparently with reference to the differmg conditions of different ports ; and had the Government of China shown a disposition to content itself with anything Uke the amount of U-kin that the provincial Governments were at the time professmg to collect, I am persuaded that no obiection would have been raised to the measure. But the uniform rate proposed by the Grand Secretary Li would have more than doubled this amount, and I have since been given to understand that even when h-Un, U the very high rate his Excellency p^pS should be col ected It was s lU m contemplation to make an additional levy hUand Now we know that at the ports at which the rate of li-kin is excessive! the import of opium IS comparatively small, that it pays the smuggler to smuffffle it aii^ 1 w S the sma 1 quantity imported a large prop'ortion evalL the SS^^^ It t^frny con viction that the imposition of a uniform high rate would be nnnrnfl+oiT l^u- On the other hand, that it would be certain to aCm thp p^f ^^^^^^f *« China. Though perfectly willing to support the levy of a uniform rate ihZ7'''^fi ^v^"!??- agree to the uniform rate proposed in 1876. The GovemmP. t ^fp^^ ^^^ I ^^""^"^^ *° whatever to do anything tlat^ould be injurious to t™eve,ue^^^^ ""X^'T reverse, and it is with a view to securin^g the Chinese SCent'^haV b^ongs t it that I have made the calculations submitted in various Conferences to the Ministers of the Yam^n. As the base of these I have taken the amount of opium shown by the Customs Returns published by Mr. Hart, the Inspector- General, to have been imported into Hong Kong in the year 1878. This, according to these Returns, was 94,899 piculs, of which 72,424 piculs paid duty at the Treaty ports. Of the remaining 22,475 piculs the Returns give no account after its arrival in Hong Kong. The Tariff revenue on the 72,424 piculs entered at the Treaty ports, at 30 taels per picul, would be 2,172,720 taels. Erom the information before me regarding the li-kin Tariffs at the same ports, the charge for li-kin would average above 32 taels 7 mace, Say 32 taels 8 mace per picul. At this rate there should have been collected in 1878 about 2,877,500 taels. That is to say that this would have been the amount received at the Treaty ports had li-kin been collected on all opium that paid. Tariff duty at the same ports. But a large portion of this, beyond doubt, evaded the li-kin altogether. Again, of the 22,475 piculs deposited at Hong Kong, some, no doubt, paid duty of some sort as it reached the mainland. In a memorial published recently in the " Peking Gazette," being the return made by the Superiatendent of Customs at Canton, of the revenue collected by the native establishments under him during the financial year 1875-76, he reports the collection of 324,395 taels upon opium. This sum, however, is but equal to the Tariff duty that would be levied at a Treaty port upon 10,813 piculs. It is returned as " Cheng Shui," regular duty, as opposed, I presume, to sundry charges. But, whatever the signification of the term, no one, I imagine, will dispute that there must be, from some cause or other, a serious loss of revenue under the existing arrangement, For, according to the Customs' Returns already quoted, there were deposited in Hong Kong, over and above the quantity entered at the open ports, ia 1875, 21,670 piculs ; in 1876, 27,134 piculs ; in 1877, 24,021 piculs ; in 1878, 22,475 piculs ; let us say from 20,000 to 25,000 piculs a-year. Now a certain proportion of this quota wUl have been consumed in Hong Kong ; a certain proportion sent to California, Australia, or elsewhere ; but there will stiH remain a considerable amount altogether unaccounted for. To return to the port collections. My estimate of 2,377,500 taels as the total li-kin collected on opium at the ports, assumes that li-kin at the rate of 32 taels 8 mace was paid on every picul of opium that paid Tariff duty. As a fact, however, this is far from the case. Wherever the li-kin is exorbitant, as at Eoochou and Amory, the import of opium, through the foreign Customs, is comparatively small, and more than one-half of the li-kiri due upon the quantity imported is evaded. It is even evaded in a less degree elsewhere. When, therefore, on my return to the north, some four months ago, I discussed the question of opium li-kin with the Grand Secretary Li at Tientsin, I proposed that, if a uniform rate were to be the rule, it should not exceed 30 taels a picul. * To this the Grand Secretary demurred. My estimate, he argued, would at the most but cover the collection at the ports. It did not include the collection inland. The Ministers of the Tsung-li Yamen have met me with the same objection. But, while their Excellencies contend that the amount of opium li-kin collected inland is considerable, the Grand Secretary declares it to be comparatively insigni- ficant. The Minister Kuo's observations were in the same sense as the Grand Secretary's. The port collection, in his opinion, was the important one. If the li-kin coUectorates now to disappear from the Settlements were not replaced by some such agency as I have suggested, the loss in li-kin revenue, he maintained, would be immense. Neither the Grand Secretary nor the Ministers of the Tsung-li Yam^n have given me any data on which to revise my estimates. From memorials presented to the Throne, three or four years ago, it would seem that the Board of Revenue is left by the provincial Governments without much information on the subject. Now I feel myself next to certain that, taking the inland and port collections together, the Chinese Government did not, in 1878, receive more than 30 taels li-kin ■per picul on all the Indian opium consumed in the country. However, as the port coUectorates professed to levy li-kin at rates which, on an average, would impose on the drug something under 33 taels per picul, and as there was still stated to be a farther levy of li-kin inland, I was prepared to recommend the Governor of India to agree to a uniform rate of 40 taels per picul, to be secured to the Chinese Govera. ment, not only 6n the opitutt bfottgM into the Treaty ports, but on all that is deposited at Hong Kong in excess of a certain stated quantity, that should be set apart, eitner for eonsumption in the Colony, or for exportation thence to Australia, Calitorma, or other places, with which the inland revenue of China can ha,ve no concern. The advantage to the revenue of the Empire from the adoption of such a scneme is easily demonstrated. The total amount of opium landed at Hong Kong m J-S'o. ^ have stated, was 94,899 piculs, of which but 72,424 piculs found {l^^ir way to the open ports. The Tariff revenue on this amounted to 2,172,720 taels. The Zx-fcm at ^2 taels 8 mace ought to have been about 2,377,500 taels. Had none of the latter been evaded, therefore, the total collection of Tariff duty and li-hn on opium imported th^ouffh the ports should have been something over 4,550,200 t^els._ from the Quantity detained in Hong Kong, namely, 22,475 piculs, toy idea was to deduct, say, 7,500 piculs for the use of the Colony. This would stiU leave 14,975 piculs, which, it is to be presumed, was carried into China byway ot tUe coast. The Tariff revenue on this would have been 449,250 taels. The h-hn at 32 taels 8 mace, would have been 481,180 taels ; in all, 930,430 taels. AlloTong the Superintendent of Customs at Canton to have collected m 1878, as m lS75-l»7b, some 320,000 taels, the total collection of Tariff duty, li-kin, and Canton 'regular duty Under the old arrangement would have been something less than 5,000,000 taels. Under the arrangement contemplated by me, the proposed Hong Kong quota of 7,500 piculs being deducted from the total imports of 94,899 piculs, there would have remained 87,399 piculs, which, paying 30 taels Tariff and 40 taels h-kin, m all 70 taels per picul, would have yielded in all 6,117,930 taels. The opium revenue would thus have gained above 1,000,000 taels. To secure the li-Mn to the Government of China, it was my intention to propose that it should be collected by the Government of India, and remitted to China under the following conditions:— The Customs Eeturns, published quarterly or annually, show the quantity of opium that pays Tariff duty at the ports. On every picul entered by the Customs as paying Tariff duty, I should have moved the Government of India to pay li-kin at the rate agreed to, remittance being made either of the whole or of whatever proportion the Chinese Government might desire to the Government of the province into which the opium was shown, by the Customs Returns, to have been imported. The apprehension of the provincial Governments that a change in the system of collection would cripple their resources would thus have been set at rest, i'or the opium proved to have been left at Hong Kong, and not carried to the Treaty ports (the colonial quota being, of course, set apart as p^ing neither Tariff duty nor li-kin), 1 would have moved the Government of India to pay both upon the balance ; but according to the annual, and not the quarterly Beturn, as there might have been difficulty in declaring the amount to be taxed before the annual Report was completed by the Customs. Had such an arrangement been accepted by the Chinese Government, I should have stipulated, on behalf of the Government of India, that the uniform rate of li-kin agreed tp was to cover all charges, and that, on no pretence whatever, was any additional impost to be laid on Indian opium, whether inland or elsewhere. I should have farther recommended the Government of India to accept it only for a term of years, as a measure upon its trial. On behalf of the Government of Hong Kong, again, I should have claimed with- drawal of the cordon of custom-houses and cruizers, which, though maintained at a great expense, poUect but little revenue, while by their action they occasion no small annoyance to the Colony. The Colonial Government, I have every reason to believe, would have been prepared, if the above conditions were agreed to, to prohibit the salt trade, as heretofore carried on at Hong Kong, and to make arrangements that would secure the Government of Canton against the irregular exportation from the Colony of munitions of war. The above records, I think, with tolerable fidelity, the scheme which in various interviews has been submitted to the Ministers of Tsung-li Yamfen. It has not been favourably received by their Excellencies, who, in sum, have assured me, firstly, that my uniform rate of 40 tales was far too low ; and, secondly, that even were the li-kin to be fixed at as high a rate as 60 taela, the rate named by the Grand Secretary Li, my project of collecting this through the Government of India would be for many reasons distasteful to the Chinese Government. My^esire,.as 1 have stated at the commencement of this long note, has been to protect Her Majesty s Government against the charge of acting otherwise than fairly by the Government of China. In the Chefoo Agreement the Chinese Government consented to open iom ports and six places of call on the Great Riyer, witliin six months of the Imperial Decree, approving the memorial of the Grand Secretary Li,, I had, on my part, undertaken to move Her Majesty's Government to allow the foreign Settlement at the Treaty ports to be regarded as tixe area vrtthin which foreign imports should claim exemption from K-kin ; and to sanction collection of the li-Un on opium at the same time as the Tariff duly, and through the foreign inspectorate. The opening of the ports and of the places of caE within six months was promised uncon- ditionally on the part of the Chinese Government, and the promise has oeen tept. The date for giving effect to the stipulations affecting li-kin taxation of imports, and collec- tion of li-kin on opium, I stipulated should be fixed only as soon as my Government had arrived at an understanding with other foreign Governments. Three years having elapsed since the Agreement was signed, I felt bound to state that should it prove impossible to arrive at any satisfactory solution of the question of li-kin area, or of the question of opium li-kin, it would be my duty to recommend Her Majesty's Government to offer to surrender the concession of ports and places of call, for which it found itself unable to yield the quid pro quo that I had contemplated. The Ministers did not, I think, understand in what spirit I submitted this view ef my obligations to tham« One of their ExceUenoies, indeed, implied that xnj readiness to give back the right to trade at these ports was suggested by the discoveiy that our merchants did not greatly frequent the ports, and that our trade had not derived the advantage I had expected from the opening of the ports. I do not suppose that large mercantile communities will be formed at any new port. With steamers running daily from point to point it is improbable that stocks will be accumulated, save at some of the more considerable centres made accessible by the earlier Treaties. But be the future of the trade what it may, its possible dimensions had nothing to say to my observation on the occasion referred to. The Ministers, I may add, did not manifest any disposition to consider my suggestion that the ports opened under the Chefoo Agreement Jidght be closed again. In my last conference with their ExcellencJes, upon the 20tb of September, I understood their Excellencies to say that as the difficulty of setting a uniform rate that would be acceptable to both parties seemed insurmountable, they would prefix that li-kin should be levied at the rates ruling in the different ports at the time ths^ the Chefoo Agreement was signed. These rates are of course known to every one, and I shotdd myself make no objection to their contiauance, but J am bound to ad^ that tefore submitting the proposition to Her Majesty's Government, I should require very exact information as to the position of the opium li-kin collectorates inland of the ports, and the rates of li-kin levied at each of these. I must also be enabled to report that the new method of collection is understood to be merely on its tiW for a specified length of time; that during the term of its probation the Chinese Government guarantees the imposition of no higher rate of li-kin upon opium than that now agreed to, and that when this term expires the whole question, if the Government of India desire it, shall be reconsidered. On the occasion referred to, I remarked to the Mimsters that it would be desirable at ports like Eoochou and Amoy to lower the present extravagantly high rates of li-kin, as practically they tend to exclude opium from those ports ; and, by its exclusion, to interfere otherwise with trade. The mercantile community at Eoochou addressed me on this subject when I was at that port in the summer. I should have been willing, were these rates reduced, to support an augmentation of the rate at some other port or ports. The Ministers appeared averse to discussion of this proposal. I venture, nevertheless, again to bring it forward as one deserving of consideration. The relief of Hong Kong from its blockade is properly part of the quraiaon of opium taxation, but with your Imperial Highne^'s permission, I shall make it the subject of a separate note. I renew, &e. (Signed) THOMAS I'EANOIS WADE* Inclosure 2. The Prince of Kung to Sir T. Wade. (Translation.) Peking, November 20, 1879. THE Pnnce has to acknowledge the receipt of the British Minist^'s note of the 10th instant, on the subject at the collection of lirkin on opium. [Quoted almost at length.] L^ . 6 As regards the Hong Kong blockade, a reply has already been sent to the British Minister; and with respect to the other question, the Prince has to observe, in reply to the British Minister's observations, that in the Agreement signed at Ohefoo, on the 13th September, 1876, it was not stipulated that the instrument should be ratified by the head of either State. There was a stipulation that the four new ports, and six places of call on the Great River should be open within six months after the receipt of the Imperial Decree approving the memorial of the Grand Secretary Li ; and, in accord- ance with the terms of the memorial, effect was given to the stipulation some VPflT*Q SCO In 1878, the Yam^n received a communication from the Chinese Minister in England, Kuo-ta-jen, reporting that in a note received from the Earl of Derby, Her Britannic Majesty's Secretary of State for foreign Affairs, his Lordship had stated that the regrettable affair known as the Yunnan case might be considered closed. That the Yiinnan affair, then, is finally closed, has already been declared by the English Foreign Office to the Minister Kuo. As regards the exemption of foreign goods from li-kin taxation within the foreign Settlements at the respective ports, it is provided in the Chefoo Agreement that a date will be fixed for carrying out this arrangement, and also for giving effect to the stipulation regarding the simultaneous collection of li-kin and Tariff duty upon opium. In December 1876, after the British Minister had left for England, M. von Brandt wrote requesting the Yam^n to fix a date for carrying out three separate afangements ; the first of which was that within the foreign settlements at Shanghae foreign imports should be exempt from li-kin. Accordingly, the Yam^n submitted a memorial to the Throne, and the 13th Eebruary, 1877, was fixed as the date for giving effect to this arrangement. A note to this effect was addressed to M. von Brandt, and to the Bepresentatives of Great Britain and the other Powers. Thus, effect was given to the stipulation so far as Shanghae is concerned, without waiting imtil Great Britain had consulted with the other Powers with regard to the exemption of foreign goods from li-kin within the Settlement areas at the different ports. Although M. von Brandt took the initiative in this -matter, the Yamen is not aware that either the Bepresentative of England, or any other Power, had any objec- tion to offer to M. von Brandt's proposal that the arrangement should be at once carried out. Eoreign merchandize, therefore, being exempt from li-kin within the Settlement at Shanghae, it is right that the simultaneous collection of li-kin and Tarifi duty on opium should also be proceeded with ; and as the opium question, according to the British Minister's statement, solely concerns England, her consultation on the subject with other Powers is immaterial, and it is, a fortiori, with the British Minister alone that the Yamen has to deal. The British Minister states that a comparison of the amounts of opium imported into Hong Kong and into the open port, shows that a large quantity is smuggled, and that he had thought of a plan by which a uniform rate of duty was to be collected by the Indian Government, and annually remitted to China. As this idea proceeds from a desire to protect the revenue of China, it is but right to expr^s thanks to the British Minister. But as under the Treaty Chinese Custom- house officers at the open ports are bound to protect the revenue, and guard against abuses, it is the duty of the Yam^u to give instructions to devise effectual measures to this end, m accordance with Article XLYI of the Treaty. It is not desirable that Sfi^s?E Jeciiti troubled with a duty which properly belongs to the The establishment of a uniform rate of li-kin upon opium discussed by the Grand Secretary Li with the British Minister, was not in the first place a condition contem- plated when the Chefoo Agreement was concluded, and then as to the amount of the uniform rate proposed, the British Minister having raised this from 32-7 taels or 32-8 taels to 40 taels, would go no higher; and ^tMs amount was to be understood to clear opium of all the U-kin collected inland as well, before the sXme could be put on tria . But by the Yam^n's estimate, the inland Z^T apart mi W the rate were raised to 60 taels [at the ports], it would not suffice to makr^^od the amount that should be collected at the ports bv the several nrnvi^noioi P^f^.^o^^ ^^e which they are. Aftei- several conferLces,ttorat /h cr^^^^^^ be arrived at, the Yamen proposed that further considektion of a uniforrSte shS b^: tTkfn ^^pTprsiTi; s r ji;t^^^^^^^ to give this course a trial for five je^;:^ l^i^tltiraJf^-S^^^^ that this is his own arrang6ment, it is to be presumed that there will be no difficulty in fixing a time for bringing it into operation. When the term of the trial expires, consideration of the arrangement can be resumed by both parties. As regards the British Minister's desire to be informed of the locality of the li-kin stations in the interior, and of the Tariff of rates ruling, Article V of the Eegulations appended to the Tariff states that, once opium has left the port, it becomes Chinese property, and may be taxed as the Chinese Government sees fit. Seeing that foreigners may not accompany opium into the interior, and that the moment it leaves the port it must be conveyed by Chinese subjects, it follows that it rests with the Chiuese Government to decide what taxes shall be imposed upon it. This has nothing to do with the simultaneous collection of li-Mn and Tariff duty at the ports by the foreign inspectorate. It therefore seems unnecessary to call for the data for communi- cation to the British Minister, as thereby the date for putting the plan in operation would be further delayed. The British Minister next proposes that a reduction of li-kin should be made at Poochou and Amoy, where the rates are high, and an increased rate be imposed where the tax is moderate, the intention being to adjust the burden more evenly. But, in the Chefoo Agreement, it is stated that the amount of li-kin wiU be decided by the different provincial Governments according to the circumstances of each. If the rates are higher at Amoy and Foochou than at other places, there were doubtless circum- stances which influenced the provincial Government in fixing these rates. Were the rates originally ruHng in the different provinces to be raised or lowered, the terms of the Chefoo Agreement would be no longer abided by. At the present moment the Tamen have but one desire. They would earnestly request the British Minister, in aU that regards the simultaneous collection of Kk-in and Tariff duty on opium, to act strictly ia accord with the letter of the Chefoo Agreement itself, and name a date for putting the plan in operation. The Prince, ia addressing this reply to the British Minister, requests that he will communicate it to his Government. Kiiang Hsio, 5th year, 10th moon, 7th day. Inclosure 3. Sir T. Wade to the Prince of Kung. Sir, Peking, December 27, 187 9 I BEG to refer your Imperial Highness to the reply that you did me the honour to write, upon the 20th November, to my note of the 10th of that month, upon the subject of opium taxation. As the Ministers of the Tsung-li Yamen will have informed your Imperial Highness, the question has been further discussed with their Excellencies in two Conferences, one, on the 28th November, when Mr. Brenan and Mr. Hillier were sent to wait upon them with a memorandum prepared by me ; one upon the 1st December, when I was myself received by the Ministers. Having very carefully considered all that has passed, whether in conferences or in the correspondence adverted to, I beg to submit to your Imperial Highness the following brief observations. Before proceeding to any other matter, I shall take leave to notice, in passing, the remark in your Imperial Highness's note of the 20th November regarding the settlement of the Yiinnan affair. In mine of the 10th I took credit to myself for assuming the responsibihty, without instructions from my Government, of declaring this affair closed. Your Imperial Highness appears to me to assign this settlement to the action of the Minister Kuo after his arrival in London. My note of the 30th September, 1876, to your Imperial Highness wiU, I think, remove all doubt as to the correctness of my earlier statement. Next, as to the subjection of foreign trade in general to li-kin taxation, the Tsung-li Yamen appears to retain persistently a view which I cannot but regard as erroneous; and I must be pardoned if I re-state what I understand to be the rights of China and of foreign nations in regard to this question. The provincial Governments have been in the habit, for years, of levying li-kin on all foreign imports, opium included, as soon as they passed into native hands, not onlv [15623 C 8 in tlie cQun% between the ports and the inland haxidew, hut e^en within the limits of the foreign Settlements themselves. . j n * This; upon opium, they were entitled tp dq; hut they have treated aU toreign imports as if they were opium, and have taxed them the moment they wpre m tne hands of a native purchaser. . . Against this practice foreign Representatives have in vain ppotested, as temg in violation of the Treaty ; inyselE among the rest. In 1876, however, I proposed to recommend my Government to accept ^ com- promise. If the Chinese Government would open more ports, I was for ^Uowing it to collect li-kin on all foreign imports outside the limits of the port Settlement. But t]\e consent of all the other Treaty Powers was necessary before the right of imports to exemption from li-kin could be restricted, and no l^eaty Bower has consented to the restriction. The Minister of Germany did at once demand removal of the U-kin coUectorates from the Settlement at Shanghae, but because their action was m violation of the Treaties, and not with any reference to any provision of the Chef oo Agreement. So far from approving the conditions of that instrument, he at once moved his own Government to request the Government of Her Majesty'not to ratify the stipulations of the Chefoo Agreement which regard li-kin taxation. The Representatives of four other considerable Powers addressed their Governments at the same time as the Minister of Germany, in precisely the same terms; and it is vain to expect an admission on the part of the Treaty Powers that, as the Treaties now stan^, the Chinese Government is entitled to levy li-kin upon foreign imports, as for years it has been levying it. These remarks appear to be necessary, because the Ministers of the Tam^n continually refer to the possible abandonment of such taxation at the ports as if it would be a concession on the part of the Chinese Government, whereas it wiU not be admitted, I feel satisfied, by foreign Governments, that the Chinese Government is entitled to more than the Tariff duty until the goods have reached an inland barrier. The opium trade occupies a position apart. Upon opium, as soon as it passes into native hands, the Chinese Government is entitled to levy K-kin ; and foreseeing that, if the li-kin coUectorates were banished from the Settlements the Chinese Government would too possibly sustain a loss of revenue, I agreed at Chefoo to propose that the drug imported should be placed in bond, and that the Customs' inspectorate should be authorised to levy the li-kin formerly paid to the collectorate. But, as I have observed more than once to the Ministers of the Yamen, this arrangement, although opium is at present exclusively a British import, could not, either, have been given effect to without the concurrence of all other Treaty Powers. Opium figures in the Tariff of every Treaty Power, and it is competent for the national of any one, as the Treaties no^ ^taiid, j;o carry opium into his own premises, and to sell it at the port to whoever chooses to buy it. To compel the foreign merchant to place his opium in bond, in ordgr that, when it is taken out of bond, a li-kin may be paid u^on it, inasmuch as no such engagement is to be found in any Treaty, an appeal to every Power possessing a Treaty with China becomes essential. I have little doubt that the Treaty Powers will assent to whatever arrangement regarding opium Her Majesty's Government may consider reasonable, but I feel bound to warn your Imperial Highness, as I have warned the Ministers of the Yam^n, that it is not impossible that some of the Treaty Powers, at all events, may be inclined to withhold their assent so long as the Chinese Government continueg to refuse them satisfaction of other Treaty rights affecting trade. And as regards the assent of Her Majes^'s Government itseK, I must be allowed to say this. The object of the arrangement I agreed at Chefoo to recommend was the protection of the Chinese revenue; the securing to the Chinese Government of the li-kin heretofore paid into the local coUectorates. The proposition to impose a ^?°Tl^*®J?u-^*"^*" ^* ^^ *^® P°^*^ having been laid aside, I understood it to be the wish of the Ohmese Government that I should recommend to my Government to agree to the levy of li-kin foy a term of years at the different ports, at the same rates as rqled at those ports when the Chefoo Agreement was si^ed in 1876; that the Customs mspectorate should replace, in fact, the local coUectorates at the ports, and th^t between the ports and the nearest of the old inland coUectorates during^^the term agreed to, no qoUectorate should be estabUshed. & The new arrangement involves, in the case of British subjects as much as others. Go!^rS.S!?'^v tT r''*"?.^ ^''?:*.y ^SW«' ^^ ^1^^^ laying before Her Majesi^'p Government my last word on the sub ect, it was due to Her Majesty's' Government, ap I have represented to the Ministers of the Yam6n, that I shoidd be enabled tP state precisely the conditions of opium taxation at present obtaining tt" Was ntJt tuiliatuF&l 6n fla^ Jiart, Under ttes^ tjirbumstancds, to reqiiest to be ittfotraed of the ntmiber ahcl position bf tke bid collectorates ; but updll this poiiit the" Ministers of the Yatnen have dfeclared to me that it was hot in tbeif power to supply tne with the nefefe^ary information ; I submit to jrbur Imperial Highness that the report this obliges me to make to Her Majesty's Goyernment will hardly be bbh- sidered satisfactory. Howeter, the course I now intend to pursue is this. It would be absurd on my part to agtee to any particular rate at any port if neW ooltectorates were authorized to impose what they pleased a few U inland. In 1876, the payment of li-kin at the pblpt cleared the opium of further taxation until a certain .barrier was reached. The assurance I ihust no^V- require from your Imperial Highness, is that a siihilar amount paid into the foreign Customs shall for a term of years clear the opiunl of all further taxation until this batrief is reached. The foreign Customs will thus replace the li-kin collectordt^ that used to levy the lirlcin on opium at the port. But 1 must be left in no doubt as to the number arid position of the inland barriers in question. If 1 cari obtain, in writing, satisfactory assurances that these terms are ^ticepted, I Will again move iri.^ Government to eonsent to the levy Of li-kin upbh opium by the foreign inspectorate. I wUl ais6 recommend that all other Treaty PoWers bfe urged to agree to whatever arrangement respeicting opiUM Mf oWn Government may accept. But their agreement, once more, is essential. If 1 cannot obtain the assurances I require, I shall inf oriii my Gotemment that ihef are not obtainable ; and 1 shall submit to it that the right td ti-ade at the four ports arid six places of call opened iirider the Chefob Agreement be siirrferidered, knS the Cbrisuls established at th^Se WithdraWri. The right was conceded on tWo conditions ; firfet, th&t the TreMfe^, notwith- standing the Chinese Govemmerit, should be free to levy li-Mn ori impbrts outside the limits of the TtBaty JPort Settlements ; next, that the opium li-kin should be collected by the foreign inspectorate. All the Treaty Power^ object to the first coriditibn. Their assent has still to be Obtained to the second; but were this Obtained without the guarantees 1 require, I could not recommend my own Government to give effect to it. This being so, it would be simplest under these circumstariceS that the proposals tb iriake concessions on either ^ide should be withdrawn. The JBritish Governmerit cbUid not then well be eharg'ed with having, availed itself of an advantage conceded to It, While it refused to give the quid pro quo. Let the concession made to it be surrendered, and it will not be either in the power of the Chinese Government to Ife^ilrd itself as having been treated v^th unfairness in the matter. I renew, &c. (Signed) THOMAS Pi^AKClS WAi)l. Iriclosure 4i . _ The Prince of ttung io Sir f. Wade, tTfanslation.) . . , . - ^ . . ^ , January U,MQ. . THE Prince has to acjmowledge the receipt of the [British MiriisWs note of the 27th December last, f efemrig to previous correspondence and to conversations Mth the Miriiitefs of the Tsiing-li Tarii^ri on the subject of the collection of li-kin on opium. Haying carefully considered, the contents of the British Minister's notcithe Princ^ finds that the observations coritamed tlierein accord entirely with the reports of their conferences made to him by tbe Mfiaisters of the f'amen. As rega;rds the settlemerit of the Yiinnah case, the Prince's earlier note mereW qubted a communication received from the Minister Kuo, in which it was also ^IsM. thS the BHtish Govemnaent had declared the case closed. The Prince's note did net claim ffiat the settlement had been breught about by the Minister fcub, ubr ^eny th&t the British Minister had assumed the responsibility. With regard to the subjection of foreign imports to li-kin taxation, the Chinese Government, 111 eonformity with Treaty stipulations, makes a distinction between eprtificat|d_and uncertificated gbods. Certificated, goods, no matter to what distance *^®y *^® "'?"^8'c,sent, are not taxed en route; while uncertificated merchandize pavS duty at every_ Custom-house and li-kin at every barrier. . ;9M®|chan(|ze sold l^ foreigners to QW^ within the Settlements the li-kin tax, T^Eioh w to abnormal war tax imposed by the Ohiaese GoTemment, falls on the H502J 2 10 Chinese trader; and it was undoubtedly tlie trader's interests, as .^fl jf^^^^^^ ^^ *^^ interests of the CMnese revenue, that the British Minister had ^^J^^^^^^f ^^Sd be he stipulated that within the Settlements' ^^^^ ^l^Z l^TJli^^vtni^^ ahohshed ; and that the foreign Customs should collect both the Tar^ duty and J* km on opium! When, subsequently, on the German Minister s ^PP^^^f^f ^*^^^^ fixed for abolishing the I'-ftm tax within the Settlements the Jamensubmi^^^^^ memorial to the Th?one praying that the f^^f ^^^^^ ?^f ^*' f ^'SLT Wi^/ been operation at Shanghae, they ^ad in mind that the fhefoo Ag^jement haym^^^^^ sanctioned, the OhLse Goyernment ^.«s>/°°^«;,\l^*^!i,S^TVf Jf^^^^^ '^S' in his earlier note, that the German Minister had taken the ^^^.f ^^^^^/^/.^^ ^f;X' the Prince did not wish to claim that this was done with any reference to the Chefoo Agreement; but if the German Minister disapproved the «^f i^^^^^; P//^^.^^^^^^ Agreement, how is it that he so urgently pressed that a date be fixed for putting m force the particular clause which abolishes li-km withm the Settlements ? TOh regard to opium. Article 5 of the TarifP Regulations states that once it has left the port it becomes Chinese property, and may only be carried into the mtenor by Chinese subjects. The foreign trader wiU not be aUowed to accompany it, and the Chinese Goveriment may tax it as it sees fit. This shows that when the Chefoo Agreement speaks of the simultaneous collection of TanfE duty and h-Un, the h-kin referred to is the tax at the port itself. x n,-,- i --ui The proposal to impose a rate of 60 taels to commute the amount of li-kin leviable at the port itself, having been discussed at numerous interviews, and no understandmg having been arrived at, it was at last agreed that, in the terms of the Chefoo Agree- ment, the amount of li-km to be coUected would be decided by the different provincial Governments according to the circumstances of each. It was also arranged that the import duty as stated in the Tariff, and the li-kin as provided m existing Regulations, should be simultaneously collected by the foreign Customs, and that the h-km taxation in the interior should be managed as heretofore. To this arrangement for a term of five years the British Mimster gave his verbal consent, and added that he would write a note to the Tam^n requesting to be fully informed of th6 details of the scheme for the information of his Government. The British Minister has thus consented to give a trial to the scheme for the simultaneous collection of import duty and li-kin, as provided in the Chefoo Agree- ment ; and in order to give effect to the Agreement it is necessary that the British Government should arrange with other Powers as to the date when the scheme is to begio. As to the details of the scheme, the rates of li-kin on opium at the different ports vary. The British Mimster in the course of the Conferences has frequently stated that at some ports the rate is as high as 80 or 90 taels, while at other ports it is as low as 20 or 30 taels. The Yam^n's first intention was to have a uniform rate collected at the same time as the Tariff duty ; but that question having been set aside, there but remained to adhere to the terms of the Chefoo Agreement, that is, allow the foreign Customs to collect, at the same time as the Tariff, whatever amounts of li-kin had hitherto been levied at the port, without any augmentation on the old rates. In this way, opium on importation would be taken cognizance of and placed in bond, either on board a hulk or in a warehouse, by the Customs. At the moment a Chinese purchaser was found, the foreigner would pay the Tariff duty to the Customs, while the Chinese purchaser would pay the li-kin also to the Customs. Duty and li-kin having thus been paid, permission would then be given to take delivery of the opium. Opium which had not paid both duty and li-kin would not be allowed to be taken into a foreigner's establishment for illicit sale. A breach of this Regulation would carry with it the infliction of a penalty. This is the course of action contemplated by the clause in the Agreement. The li-kin barriers at the ports were not specially erected for the purpose of taxing opium alone. Opium at the port having paid to the foreign Customs, at the same time as the Tariff duty, the li-kin leviable by the first barrier, that first barrier wiU not be authorized to impose any further tax on that opium. The second barrier, being an inland station, will of course collect li-kin as before, and all other barriers along the route wUl be guided by existing inland Regulations. Positively there is no question of re-establishing the first barrier at some point this side of the second barrier, and of continuing the levy of the tax. Such a course would be at variance with the spirit of the words of the agreement, viz., "ping cheng "—simultaneous collection. On this head the British Minister need not entertain any apprehension. 11 The British Minister wishes to be informed of the position of the li-kin stations in the interior. The Yam^n conld, of course, call on the different provinces for the necessary information, and communicate it to the British Minister ; but the corres- pondence backwards and forwards would involve delay; and, moreover, as an assurance has now been given that no additional barriers will be established, the Prince assumes there is no diflB.culty in at once carrying out, either at all the ports, or at the one port of Shanghae to begin with, the plan which the British Minister stated he was willing to put on its trial for a term of five years. This proposition he is once more requested to consider. As to the new ports and the six places of call, a memorial on the subject was submitted to the Throne, and effect was given to the arrangements some years ago, China has not the slightest desire to take them back ; on the other hand, the British Minister is earnestly requested to move his Government to show its sense of justice by naming a date for carrying out the provisions of the Agreement. Inclosure 5. Sir T. Wade to the Prince of Kung. Sir, Peking, January 30, 1880. I HAVE the honour to acknowledge your Imperial Highness' reply of the 14th instant to my note of the 27th December. I do not propose to trouble your Imperial Highness at great length upon the subject of the general trade. The taxation of this, otherwise than in accordance with Treaty, has been protested against, not only within the last few months, but again and again for years past, not only by myself and my predecessors, but by the Representa- tives of all the Treaty Powers interested in the import trade, under some of whose Treaties [even a larger measure of exemption from inland taxation is demanded than that which I have been wont to claim under the British Treaty, My own construction of our right under the British Treaty in respect of abnormal taxation was admitted by the Grand Secretary Li at Chef oo to be reasonable ; and the admission is recorded in the first sentence of the 1st Article of the 3rd Section of the Chefoo Agreement. Neither do I conceive it necessary to repeat my arguments against the assumption that the withdrawal of the li-kin collectorates from the foreign Settlement at Shanghae was demanded by the Minister of Germany and his colleagues with reference to the Chefoo Agreement ; but I shall observe once more that if they had approved of the Chefoo Agreement they would not have moved their respective Governments to request the Government of Her Majesty not to accept its provisions affecting commer- cial intercourse. As regards the taxation of opium, I understand the arrangement ageeed to at the Tsung-li Yamen to be this. In the Chefoo Agreement I engaged to recommend that British merchants, when opium was brought into the port, should be obliged to have it taken cognizance of by the Customs, and deposited in bond, either in a warehouse or a receiving hulk, until such time as there was a sale for it. The importer, was then to pay the Tariff duty upon it, and the purchaser the li-kin. After much discussion with the Ministersjof the Tsung-li Yamen and a correspon- dence with your Imperial Highness it has been proposed that a certain arrangement shall be put on its trial for a term of years at the port of Shanghae, under the following conditions : When the Chefoo Agreement was signed in 1876, a li-kin office at Shanghae collected 40 taels per picul on opium as soon as it was sold. Inland of this office there existed other collectorates which taxed opium on its way inland. The foreign Customs inspectorate is now to replace the first or port coUectorate, so far as opium is concerned, and is to levy li-kin upon the drug at the same rate as that in force in 1876. This rate is not to be raised during the term prescribed, and no fresh li-kin coUectorate is to be established between the port coUectorate and the second coUectorate existing in 1876. In the note under acknowledgment it is stated, as it has been before stated, that I had verbaUy agreed to five years as the term during which the new arrangement should be on trial. I do not recollect naming any precise number of years, but I am. now forwarding the whole of the papers connected with this question to the Marqius 12 m Mitttirf , %M I %M HfJbMffi^tiMg tBMj if aU dmmmm MS ^ii ttfe Mw mmm m^a m im m ffiai f^r fife yem. TM ndtfe enfl^ MtB a«l ^SSurMcd tMt thS GEiiieSe GOfgriiia'^M Ras io fliii*^ tt llosiS the fbiif Jibrts aiid th^ JilaceS of call opned by the OhfefBo Agf eeM^at, SM ^tt Hth earnest request thdt Hei^ Majesty's Government inay be niored to shoW ifci sehS6 oi justice by carryiiig out the provisions of the Agreetheiit. I dan only fep^at that the opening of these ports knd plafceS of call tb British IrMe, having been negotiated by me as the quid pro quo for cerHlin arrangements afifecting Ohiiiese revenues, to part df which the consent of other Governments, and to part of which the consent of my Own Government was essential, I must consider it my duty, if the iarrangeirlent adverted to prove eventually incapable of adoption, to urge my Government to suireihdei? on behalf of British merchants whatever rights in respect of residence or trade at tiii^se ports or places of call would have otherwise accrued to thfeni under the Ohefdo Agreement. It will then be impossible for thfe Chinese Government to i^proaeh the Government of Her Majesty with bad faith. I renew, &c. (Signed) THOMAS FRANCIS WADE. ^\-« '^..., ^ ' '■ III I hi'rrii" j5 g o- 8.1 •^ &- I' ta ^ Co '^ # ^ ■4 S" h-< §■ 00 00 § o § •* ^ D o — 1 CIS i g. 1 i (D 00 a 1 g >a s. i° o ;3 §1 ►^ p S !^ ff« H-l S- 5' o s ee 2. -J o 1—* eV u •< -n 00 -J B- H o so p. ■g 3- O 1"^ El- B ^ 25 s' §■• s^ p g> s » CO M' '-N i-ij OQ »— • IS 00 CU O B , 2 B- < «■ - ■^^ -s i ^ 5 eft '^ ft ^ ■4 &; t—t Si 00 00 i gi ^9 ° o g *< 4 »!•<. d "^ m CD p a » " § « 2. § r s. ■< 5' S. n CD K^ CD S" S? o' ■ ^l p ' a^ ■1 CD 3- « Toutes les Russies, muni de pouvoirs speciauxpour signer le present Trait4 en quality d'Ambassadeur Extraordinaire. Les susdits Plenipotentiaires, munis de pleins pouvoirs qui ont ^t^ trouv^s suffisants, sont convenus des stipulations suivantes : — ■ ARTICLE I. Sa Majesty lEmpereur de Toutes les Russies consent au r^tablissement de I'autorit*^ du Gouvernement Chinois dans le pays d'lli, temporairement occup6, depuis 1871, paries armies Russes. La Russie reste en possession de la partie occidentale de ce pays, dans les limites indiqu^es k I'Article VII du present Traits. ARTICLE II. Sa Majesty I'Empereur de la Chine s'engage k d^cr^ter les mesures propres k mettre les habitants du pays d'lli, k quelque race et k quelque religion qu'ils appartiennent, k I'abri de toute poursuite, dans leurs biens ou dans leurs personnes, pour actes commis durant ou apr^s les troubles qui ont eu lieu dans ce pays. Une Proclamation conforme k cet engagement sera adress^e par les autorit^s [392] ' B 2 Chinoises, au nom de Sa Majesty I'Etnpereur de. la Chine, ^ la population da pays d'lli, avant la remise de ce pays aux dites autorit6s. ARTICLE III. Les habitants da pays d'lli seront libres de rester sur les /i^"'^ ^^J^?'' residence actuelle, corame sujets Chinois, oa d'6m.grer «" R"«^!«, «^J/^°°P^^^^ suj^tion Rasse. lis seront appel^s k se prononcer a ce saiet avant ^/^ f ^hssement de I'autorit^ Chinoise dans le pays d'lli, et un d^lai, d'an an. k partir dujour de la remise du pays aux autorit^s Chinoises, sera accord^ k ceux qui t^^f^'g"^^""^ le d^sir d'^migrer en Russie. Les autorit6s Chinoises n'opposeront aucune entrave k leur Emigration et k I'exportation de leur propri6t6 mobihere. ARTICLE IV. Les sujets Russes possEdant des terrains dans le pays d'lli conserveront leurs droits de propri^te, mgme aprds le r^tablisseihent de I'autontE du Gouvernement Chinois dans ce pays. , ,,,,. • ,j . * Cette disposition n'est pas applicable aux habitants du pays d lit qui adopteront la sui^tion Russe, lorsdu r^tablissement del'autoritE Chinoise dans ce pays. Les sujets Russes dont les terrains scat situEs en dehors des emplacements affect^s aux factoreries Russes, en vertu de I'Article XIII du Traite de Kouldja de 1851, devront acquitter les m&mes impdts et contributions que les sujets Chinois. ARTICLE V, Les deux Gouvernements d^Mgueront k Kouldja des Commissaires qui procdderont k la remise d'une part, et k la reprise de I'autre, de I'administration de la Province d'lli, et qui seront charges; en gdri^ral, de I'exdcution des stipulations du present Traits se rapportant au r^tablissement, dans ce pays, de I'autoritE du Gouvernement Chinois. Les dits Commissaires rempliront leur niandat, en se conformant k I'entente qui sera Etablie quant au mode de remise d'une part et de reprise de I'autre, de I'administration du pays d'lli, entre le Goiiverneur-G^nEral du Turkestan et le Grouverneur-GEn^ral des provinces du Chan-si et du Kan-sou, charges par les deux Gouvernements de la haute direction de cette affaire. La remise de I'administration du pays d'lli doit Stre terminde dans un d^lai de trois mois, ou plus t6t, si faire se pent, k dater du jour de I'arrivEe k Tashkend du fonctionnaire qui sera d^lSguE par le Gouverneur-G^neral du Chan-si et Kan-sou auprds du Gouverneur-G^n^ral du Turkestan, pour lui notifier la ratification et la promulgation du present Traits par Sa Majesty I'Empereur de la Chine. ARTICLE VT. Le Gouvernement de Sa Majesty I'Empereur de la Chine paiera au Gouverne- ment Russe la somme de 9,000,000 de roubles m^talliques, destinde h. couvrir les frais occasionnes par I'occupation du pays d'lli par les troupes Russes depuis 1871, k satisfaire toutes les reclamations pEcuniaires auxquelles ont donnE lieu, jusqu'aujourd'hui, les pertes que les sujets Russes ont subies dans leurs biens pillEs sur territoire Chinois, et k fournir secours aux families des sujet^ Russes tu6s dans les attaques armies dont ils ont 6t6 victimes sur territoire Chinois. La somme susmentionn6e de 9,000,000 de roubles m^talliques sera vers^e, dans le terme de deux ans k partir du jour de I'Echange des ratifications du present Traite, suivant I'ordre et les conditions convenus entre les deux Gouvernesm^nts dans le Protocole special annex6 au present Traits. ARTICLE VII. La partie occidentale du pays d'lli est incorpor^e a la Russie, pour servir de lieu d'^tablissemeiit aux habitants de ce pays qui adopteront la suj^tion Russe, et qui, par ce fait, auront du abandonner les terrains qu'ils y poss^daient. La frontifire entre les possessions de la Russie et la' province Chinoise d'lli suivra, en partant des montagnes B6djiti-Ta6u, le cours de la Rivi&re Khorgos, jusqu'4 I'endroit oia celle-ci se jette dans la f-iviere Hi, et, traversant cette derni^re, se dirigera au sud, vers les Montagnes Ouzofttaou, en laissa:nt k I'ouest le village de Koldjat. A partir de ce point elle suivra, en se dirigeant au sud, le trac4 fixd par le Protocole signe a Tchougoutchak en 1864. ARTICLE Vltl. Une partie dela lighe-frontiere, fix^e par le Protocole sign6 k Tchougoutchak, en 1864, k I'est du Lac Zaisan, ayant et6 trouv^e d^fectueuse, les deux Goiiveriie- ments nommeront des Commissaires qui modifieront, d'un commun accord, I'ancien trac6, de manidre a ^carter les d^fectuosit^s signal6es, et k etablir une separation efiicace entre les tribus Kirghises soumises aux deux Empires, II sera donn6 au nouveau trac6, en tant que possible, une direction inter- m^diaire entre I'ancienne frontiere et une ligne droite se dirigeant des Monts Kouitoun vers les Monts Saour, en traversant le Tcherny-lrtych. ARTICLE IX. Des Cbmmissaires seront nomm^s par les deux Parties ContractanteS, pour proc^der a la pose de poteaux de demarcation, tant sur le trace fix6 par les Articles precedents vll et VIII, que sur les parties de la frontiere ou 11 n'a pas encore 6t6 pose de poteaux. L'epoque et le lieu de reunion de ces Commissaires seront fixes par une entente entre les deux Gouvernements. Les deux Gouvernements nommeront egalement des Commissaires pour examiner la frontiire et pour jDoser des poteaux de demarcation entre la province Russe de Ferganah et la partie occidentale de la province Chinoise de Kachgar. Ces Cbmmissaires prendront pour base de leurs travaux la frontiere existante. ARTICLE X. Le droit reconnu au Gouvernement Russe par les Traites, de nommer des Consuls k Hi, a Tarbagatai, k Kachgar, et k Ourga, estetendu, d^s k present, aux villes de Sou-Tcheo (Tsia-yu-kouan), et de Tourfan. Dans les villes suivants: Kobdo, Ouliassputai, Khami, Ouroumtsi et Goutchen, le Gouvernement Russe etablira des Consulats au fur et k mesure du developpement du commerce, et apr^s entente avec le Gouvernement Chinois. Les Consuls de Sou-Tcheou (Tsia-yu-kouan) et de Tourfan exerceront les fonctidns Consulaires dans les districts voisins, ou les interSts des sujets Russes reclaimerbnt leur presence! Les dispositions contenues dans les Articles V et VI du Traite conclu k Pekin, en 1860, et relatives a la concession de terrains pour les maisons des Consulats, pour les cimeti^res et pour les pMurages, s'appliqueront egalement aux villes de Sou-Tcheou (Tsia-yu-kouan) et de Tourfan. Les auturites locales aideront les Consuls k trouver des habitations provisoires jusqu'au moment oil les maisons des Consulats seront construites. Les Consuls Russes en Mongolie et dans les arrondissements situes sur les deux versants du Tian-chan se serviront, pour leurs voyages et pour I'envoi de leur correspondance, des institutions postales du Gouvernement, conformement aux stipulations de I'Article XI du Traite de Tien-tsin et de 1' Article XII du Traite de Pekin. Les autorites Chinoises, auxquelles ils s'adresseronta ces fins, leur pr^teront aide et assistance. La ville de Tourfan n'etant pas une localite ouverte au commerce etranger, le droit d'y etablir un Consulat ne saurait &tre invoque comme precedent pour obtenir un droit-analogue par rapport au ports de la Chine, aux provinces interieures et a la Mandchourie. ARTICLE XL Les Consuls Russes en Chine communiqueront, pour affaires de service, soit avec les autorites locales de la ville de leur residence, soit avec les autorites superieures de Tarrondisseraent ou de la province, suivant que les interdts qui leur soot respectivement conSes, I'importance des affaires a traiter et leur prompte expedition I'exigeront. La correspondance entre eux se fera sous forme de lettres officielles. Quant aux regies d'etiquette ^observer lors de leurs entrevues, et, en general, dans leurs relations, elles seront basees sur les egards que se doivent reciproquenient les fonctionnaires de deux Puissances amies. Toutes les affaires qui surgiront sur territoire Chinois, au sujet de transactions comnierciales ou autres, entre les ressortissants des deux Etats, serOnt examinees et regie^s, d'un commun accord, par les Consuls el, les autorites Chinoises. Dans les litiges en matiSre de commerce, les deux parties pourront terminer leurs differends k I'amiable, au moyen d'arbitres choisis de pa,rt et d'autre. Si I'entente ne s'etablit pas par cette voie, I'aflFaire sera examinee et regiee par les autorites des deux Etats. Les engagements contractus par ^crit entre sujets Russes et Chinois relative- ment k des commandes de marchandises, au transport de celles-ci, k la location de boutiques, de maisons, et d'autres emplacements, ou relatifs k d'autres transactions du m&me genre, peuvent 6tre pr^sentes k la legalisation des Consulats et des Administrations superieures locales qui sont tenus de legaliser les documents qui leur sont pr^sent^s. En cas de non-execution des engagements contractus, les Consuls et les autorit^s Chi noises aviseront aux mesures capables d'assurer rex^cu- tion de ces obligations. ARTICLE Xn. Les sujets Russes sont autoris^s k faire, conime par le passe, le commerce en franchise de droits dans la Mongolie souraise k la Chine, tant dans les localit^s et les aimaiis oh il se trouve une Administration Chinoise, que dans ceux oh il n'en existe point. Les sujets Russes jouiront ^galement de la faculty de faire le commerce en franchise de droits, dans les villes et autres localit6s des provinces d'lli, de Tarbagatai, de Kachgar, d'Ouroumtsi, et autres, situ^s sur les versants nord et sud de la chaine du Tian chan, jusqu'a la Grande-Muraille. Cette immunite sera abrog^e, lorsque le d6veloppement du commerce n6cessitera I'^tablissement d'un Tarif Douanier, conform^ment k une entente k survenir entre les deux Gouverne- ments. Les sujets Russes pourront importer dans les susdites provinces de la Chine, et en exporter, toute esplce de produits, de quelque provenance qu'ils soient. lis pourront faire des achats et des ventes, soit au comptant, soit par voie d'^change; ils auront le droit d'effectuer leurs paiements en marchandises de toute espdce. ARTICLE XIII. Dans les localit^s oia le Gouvernement Russe aura le droit d'etablir des Consulats, ainsi que dans la ville de Kalgan, les sujets Russes pourront construire des maisons, des boutiques, des magasins, et d'autres batiments sur les terrains qu'ils acquerront par voie d'achat, ou qui leur seront concedes par les autorit^s locales, conform6ment k ce qui a 6t6 ^tabli pour I'lli et le Tarbagatai par I'Article XIII du Traite de Kouldja de 1851. Les privileges accord^s aux sujets Russes dans la ville de Kalgan, ou il n'y aura pas de Consulat, constituent une exception qui ne saurait 6tre etendue k aucune autre localite des provinces int^rieures. ARTICLE XIV. Les negociants Russes qui voudront expe'dier de Russie, par voie de terre des marchandises dans les provinces interieures de la Chine, pourront, comme autrefois les dinger par les villes de Kalgan et de Toun-Tcheou, sur le port de Tien-tsin' et, de 1^^, sur d'autres ports et marches int6rieurs, et les vendre dans ces differentes localites. Les marchands se serviront de cette m6me voie pour exporter en Russie des marchandises achetdes tant dans les villes et ports susnomm^s.que sur les marches mterieurs. ^ lis auront egalement le droit de se rendre, pour affaires de commerce, a Sou- tcheou (Tsia-yu-kouan), pomt terminal des caravanes Russes. et ils v iouiront de tons les droits accordds au commerce Russe k Tien-tsin. ARTICLE XV. Le commerce par voie de terre exerc^ par les sujets Russes dans les provinces mtdneures et extdrieures de la Chine sera v6gi par le Rdgleinent annexe au prS =..f ^^^ stipulations commerciales du present Traits, ainsi que le R^glement qui lui sertdecompieinen pourront etre rdvisds aprds un intervalle de dix ans r/volus ^ partir du jour de '^change des ratifications du Traits ; mais si, dans te courant de SIX mois avant I'expirat on de ce terme. aucune des Parties Con ractantes ne manifeste le d^sir de proc^der k la revision, les stipulations commerciales? arnsTque le R^glement, resteront en vigueur pour un nouveau terme de dix ans ^ Le commerce par voie de mer des sujets Russes en Chine sera soumis aux mglements g^ndraux ^tablis pour le commerce maritime Stranger en Ch"ne s"n devient necessa.re d'apporter des modifications k ces Rdglements, les deux Gouverne men^s dtabliront une entente k ce sujet. trouverne- ARTICLE XVI. Si le d^veloppement du commerce Russe par voie de terre provoque la necessity de I'^tablissement, pour les marchandises d'exportation et d'importation en Chine, d'un Tarif Douanier, plus en rapport que les Tarifs actuellement en vigueur avec les n^cessitds de ce commerce, les Gouvernements Russe etChinois proc^deront k une entente k ce sujet, en adoptant pour base de la fixation des droits d'entr6e et de sortie, le taux de 5 pour cent de la valeur des marchandises. Jusqu'4 I'^tablissement de ce Tarif, les droits d'exportation, pr^lev^s su quelques esp^ces de thds de qualit^s inf6rieures, actuellement imposes au taux ^tabli pour le th6 de quality sup^rieure, seront diminuds proportionnellement k leur valeur. 11 sera proc6d6 a la fixation de ces droits, pour chaque espdce de th6, par une entente entre le Gouvernement Chinois et I'Envoy^ de Russie k P^i^in, dans le terme d'un an, au plus tard, k partir du jour de I'lchange des ratifications du present Traits. ARTICLE XVII. Des divergences d'opinion s'^tant produites jusqu'ici dans I'application de 1' Article X du Traits conclu k P^kin en 1860, il est 6tabli, par les pr^sentes, que les stipulations de I'Ariicle susdit, relatives aux repetitions k exercer, en cas de vol et de d^tournement de b^tail au dela de la fronti^re, seront, k I'avenir, interprdt^es dans ce sens que lors de la d^couverte d'individus coupables de vol ou de detournement de b^tail, ils seront condamn6s k payer la valeur r^elle du betail qu'ils n'auront pas restitue. II est entendu qu'en cas d'insolvabilit6 des individus coupables de vol de betail, I'indemnite k payer pour le b6tail manquant ne saurait Stre mise k la charge des autorites locales, Les autorites frontiferes des deux Etats poursuivront, selon toute la rigueur des lois de leur pays, les individus coupables de detournement ou de vol de betail, et devront prendre les mesures qui d^pendront d'elles pour la restitution, k qui de droit, du betail d4tourn6 ou qui aurait pass6 lafronti^re. Les traces du betail d6tourn6 ou qui aurait pass6 la frontidre peuvent 6tre indiqu6es, non seulement aux gardiens des postes frontidres, mais aussi aux anciens des villages les plus proches. ARTICLE XVIIP Les stipulations du Traits conclu a Aigoun le 16 Mai, ld58, concernant les droits des sujets des deux Empires de naviguer sur I'Amour, sur le Soungari, et sur rOussouri, et de faire le commerce avec les populations des localit6s riveraines, sont et demeurent confirmees. Les deux Gouvernements proc6deront a I'^tablissement d'une entente concernant le mode d'application des dites stipulations. ARTICLE XIX. Les dispositions des anciens Trait^s entre la Russie et la Chine, non-modifi6es par le present Traits, restent en pleine vigueur. ARTICLE XX. Le pr6sent Traits, ^pr^s avoir 6te ratifi^ par les deux Empereurs, sera pro- mulgue dans chaque Empire, pour la connaissance et la gouverne de chacun. L'ichange des ratifications aura lieu k St. P^tersbourg dans le terme de six mois k compter du jour de la signature du Traits. Ayant arrSte les articles ci-dessus, les Plenipotentiaires des deux Parties Con- tractantes ontsign^ etscelie de leurs sceaux deux exemplaires du present Traits, en langues Russe, Chinoise, et Fran^aise. Des trois textes, diiment confront^s et trouv^s concordants, le texte FrauQais fera foi pour interpretation du present Traite. Fait a St. Petersbourg le 12 Fevrier, 1881. (Signe) NICOLAS DE GIERS. (Sign^) TSENG (L.S.) (L.S.) * (Signe) EUGENE BUTZOW. ^ '' ' (L.S.) Protocole. En vertu de I'Article VI du Traite sign^ aujourd'hui par les PMnipotentiaires des Gouvernements Russe ct Chinois, le Gouvernement Chinois paiera au Gouverne- 6 ment Russe la somme de 9,000,000 roubles m^talliques, dest.n^fi k couvrir les f^ais de I'occupation du pays d'lli par les troupes Russes, et a satisfaire diverses reclama tions p4cuniaires des sujets Russes. Cette somme doit 6tre pay6e dans le deJai de deux ans a compter du jour de I'echange des ratifications du 1 rajte. D^sirant preciser le mode de paiementde lasomme pr^cit6e, les boussignes sonc convenus de ce qui suit : — , ^ ..,. -^f> ^ . . „ Le Gouvernement Chinois verseral'^quivalentde la somme de 9,000,OUU roubles en livres sterling, soit 1,431,664Z. 2s. sterling chez MM. Baring, Freres, et Cie., k Londres, en six parts egales de 238,610Z. 13*. 8d. sterling chacune, moins les fraisde banque d'usage qui seront occasionn^s par le transfert de ces paiements a Londres. i- i. j i» <- i Les versements seront 6chelonnds a quatre mois de distance 1 un de 1 autre, le premier devant fetre effectu^ quatre mois apr^s I'^change des ratifications du lrait6 sign^ aujourd'hui, et le dernier au terme de deux ans r^volus apr^s cet 6change. Le present Protocole aura la m6me force et valeur que s'il ^tait insert mot a mot dans le Traits sign6 aujourd'hui. En foi de quoi les Pl^nipotentiaires des deux Gouvernements ont signe le present Protocole et y ont appos6 leurs sceaux. Fait a St. P^tersbourg, le 12 F^vrier, 1881. ^c,t.^t^ (Sign6) NICOLAS DE GlERS, (Sign6) TSENG. (L.S.) (L.S.) (Sign6) EUGENE BUTZOW. (L.b.) Reglement pour le Commerce par Voie de Terre. Article 1". Un commerce de libre-echange et en franchise de droits, entre sujets Russes et sujets Chinois, est autoris6 sur une zone limitrophe s'etendant des deux c6t^s de la fronti^re it la distance de cinquante verstes (cent li). Chacun des deux Gouvernements se reserve de surveiller ce commerce conform6ment k ses reglements fronti^res. Art. 2. Les sujets Russes se rendant pour affaires de commerce en Mongolie et dans les districts situ6s sur les versants nord et sud du Tian-chan peuvent franchir la frontifere seulement en certains points, ^num^r^s dans la liste annex^e au present Reglement. lis doivent 6tre munis par les autorit^s Russes de permis en langues Russe et Chinoise, avec traduction Mongole et Tatare. Le nom du proprietaire de la marchandise ou du chef de la caravane, la specification des marchandises, le nombre des colis et celui du b^tail peuvent 6tre indiques, en langue Mongole ou Tatare, dans le texte Chinois de ces permis. A leur entree sur territoires Chinois les marchands sont tenus de presenter leurs permis au poste Chinois le plus proche de la fronti^re, ou, apres verification, le permis devra 6tre vis^ par le chef du poste. Les autorit6s Chinoises ont le droit d'arrfeter fes marchands qui auraient franchi la fronti^re sans permis, et de les remettre entre les mains des autorit^s Russes les plus proches de la fronti^re, ou au Consul Russe competent, pour qu'une punition s6v^re leur soit inflig^e. En cas de perte du permis, le proprietaire est tenu d'en aviser le Consul Russe le plus proche, pour s'en faire deiivrer un nouveau, et d'en informer les autorit^s locales pour obtenir un certificat temporaire lui permettant de continuer sa route. Les marchandises importees en Mongolie et dans les arrondissements situ^s sur les versants du Tian-chan, qui n'y auraient point 616 vendues, peuvent 6tre dirigees sur les villes de Tien-tsin et de Sou-tcheou (Tsia-yu-kouan), pour y etre vendues ou pour 6tre expedites plus loin en Chine. Pour le pi-eievement des droits sur ces marchandises, pour la deiivrance des permis de transport et pour les autres formalites de Douane, il sera proc^de conformement aux dispositions ci-dessous detailiees. Art. 3. Les marchands Russes qui expedient des marchandises de Kiakhta et du pays de Nertchinsk k Tien-tsin sont tenus de les faire passer par Kalgan, Dounba, et Tountcheou. La mdme voie sera prise par les marchandises dirigees sur Tien-tsin, de la fronti^re Russe, par Kobdo et Koui-houa-tchen. Les marchands doivent etre munis de permis de transport deiivres par les autorites Russes, dAment vises par les autorites Chinoises competentes, portant indication, en langues Riisse et Chinoise, du nom du propri^taire de la marchandise, du nombre des colis et du g^enre de la marchandise qu'ils contiennent. Les fonctionnaires des Douanes Chinoises situees sur la route suivie par les marchandises proc^deront, sans retard, k la verification du nombre des colis et a la visite des marchandises qu'ils laisseront passer, apr^s avoir appose le visa sur le permis. Les colis ou verts durant la visite Douani^re seront refermes par les soins de la Douane, qui marquera sur le permis le nombre des colis ouverts. La visite Douani^re ne doit pas durer plus de deux heures. •Les permis devront fetre present^s, dans un delai de six mois, k la Douane de Tien-tsin, pour 6tre annul^s. Si le propri^taire des marchandises trouve ce d61ai insuffisant, il est tenu d'en informer, en temps et lieu, les autorit^s Chinoises. En cas de perte du permis, le marchand est tenu d'en aviser les autorites qui le lui ont delivr^ pour obtenir un duplicata, et de declarer £L cet effet le nuro^ro et la date du permis egar6. La Douane la plus proche, situ^e sur sa route, apr^s avoir constat^ I'exactitude de la declaration du marchand, lui d61ivre un certificat provisoire, avec lequel les marchandises peuvent &tre dirig^es plus loin. Une declaration inexacte de la quantity des marchandises, s'il est prouvd qu'elle a et6 faite avec I'intention de dissimuler des ventes op^rees en route, ou d'^chapper au paiement des droits, entraine, pour le marchand, I'application des peines etablies dans Article 8 du present R^glement. Art. 4. Les marchands Russes qui desireraient vendre a Kalgan une partie quelconque des marchandises importees de Russie, doivent en faire la declaration a, I'autorite locale dans le delai de cinq jours. Celle-ci, apres acquittement par le marchand des droits d'importation entiers, lui delivre un permis de vente des marchandises. Art. 5. Les marchandises import^es de Russie par voie de terre, par les marchands Russes, k Tien-tsin, y acquitteront un droit d'importation equivalent aux deux tiers des droits ^tablis par le Tarif. Les marchandises import^es de Russie a Sou-tcheou (Tsia-yu-kouan) paieront, dans cette ville, les mfemes droits et seront soumises aux m^mes* r^glements qu'a Tien-tsin. Art, 6, Si les marchandises laiss^es a Kalgan et qui y ont acquitte les droits d'entree, n'y sont point vendues, leur propri6taire pourra les exp^dier a Toun-tcheou, ou a Tien-tsin, et la Douane, sans percevoir de nouveaux droits, restituera au marchand un tier du droit d'entree paye a Kalgan, en faisant une annotation correspondante sur le permis d^livr^ en ce cas par la Douane de Kalgan. Les n^gociants Russes peuvent expedier sur les marches de I'interieur les marchandises laiss6es a Kalgan et qui y ont acquitte les droits d'entree, en se conformant aux conditions generales etablies pour le commerce Stranger en Chine, apres acquittement d'un droit de transit {i.e., la raoitie des droits specifies dans le Tarif). II sera deiivr^ pour ces marchandises un permis de transport qui doit §tre exhibe a toutes les douanes et barrieres situees sur la route. Les marchandises non accompagnees de ce permis- auront d acquitter les droits aux Douanes qu'elles traverseront, et le li-kin aux barrieres. Art. 7. Les marchandises importees de Russie a Sou-tcheou (Tsia-yu-kouan) peuvent 6tre exp^diees sur les marches de I'interieur, aux conditions stipul^es dans I'Article 9 du present R^glement, pour les'marchandises expedites de Tien-tsin en destination des marches de I'interieur. Art. 8. S'il etait constate, lors de la visite Douaniere des marchandises importees de Russie a Tien-tsin, que les marchandises specifiees dans le permis ont ete retirees des colis et remplacees par d'autres, ou bien que leur quantite (deduction faite de ce qui en aura ete' laisse k ILalgan) est inferieure au chiffre indique dans le permis, toutes les marchandises presentees a la visite seront confisquees par la Douane. II est entendu que les colis avaries en route et qui, par suite de cela, auront subi un reemballage, ne seront pas sujets a confiscation, si toutefois le fait d'avarie a ete diiment declare a la Douane la plus proche et si cette derni^re, apr^s constata- tion de I'etat intact de la marchandise primitivemeut expediee, a fait une annotation correspondante sur le permis. Seront sujettes k confiscation les marchandises dont il sera constate qu'une partie a ete vendue en chemin. Si les marchandises ont ete transportees par des voies detournees, afin de les soustraire aux visites des Douanes etablies sur les routes indiquees a I'Article 3 le proprietaire en sera passible d'une amende egale au droit d'importation entier [392] C" Si I'infraction aux r^glements susmentionn^s a et^ commise a 1 msu et sansja participation du proprietaire de la marchandise, par les voituners, les Uouanes,^en fixant I'amende, prendront cette circonstance en consideration. Cette disposition^se rapporte exclusivement aux localit^s traversges par le commerce Russe par voie de terre, et ne saurait etre appliqu^e a des cas analogues qui se produiraient dans les ports et dans I'interienr des provinces. • j vux , En cas de confiscation des marchandises, le ne'gociant a le droit de lib6rer celles-ci moyennant le versement d'une somme 6quivalente a leur valeur, dument delerrain^e par une entente avec les autorites Chinoises. Art. 9. A I'exportation de Tien-tsin, par raer, en destination de quelque autre port Chinois, ouvert par les Trait^s au commerce etranger, des marchandises import^es de Russie par voie de terre, la Douane de Tien-tsin pr^leve sur ces marchandises un tiers des droits entiers fix^s par le Tarif, en sus des deux tiers dej^ percus. Aucua droit ne sera pr61ev6 siir ces marchandises dans les autres ports. Les marchandises export^es de Tien-tsin, ou des autres ports, en destination des marches int^rieurs, seront frapp^es du droit de transit {i.e., la moiti6 des droits specifies dans le Tarif) d'apr^s les dispositions g^nerales etablies pour le commerce Stranger. Art. 10. Les marchandises Chinoises, exportees de Tien-tsin en Russie par les marchands Rosses, doivent 6tre dirigees sur Kalgan par la voie indiqu6e k I'Article 3. II sera pr61ev6 sur ces marchandises, a leur sortie, des droits d'exportation entiers. Toutefois, les marchandises de reimportation achet^es a Tien-tsin, ainsi que celles achet^es dans un autre port et expedites, en transit, a Tien-tsin, pour exportation en Russie, etant accompagnees d'un re9u de la Douane constatant le paiement des droits de sortie, n'en seront pas frapp6es une seconde fois, et le demi-droit de reimportation (droit c6tier) vers6 a Tien-tsin, sera restitu6 au marchand, si les marchandises qui auront acquitt6 ce droit sont exportees en Russie dans le d^lai d'un an apres le versement de ce droit. Le Consul de Russie d^livre, pour le transport des marchandises en Russie, un permis portarit indication, en langues Russe et Chinoise, du nom du proprietaire de la marchandise, du nombre des colis et des marchandises qu'ils contiennent. Ces permis seront vises par la Douane du pore et devront accompagner les mar- chandises, pour 6tre exhibes lors de la visite de celles-ci aux Douanes etablies sur la route. On se conformera aux regies detaill^es a I'Article 3 quant au d^lai datiis lequel le permis doit Itre present^ a la Douane pour Stre annuls, et pour les cas de perte de permis. Les marchandises doivent suivre la voie indiqu^e a I'Article 3 et ne devront pas etre vendues en route ; I'infraction a cette r^gle entraJnera, pour le marchand, i'application des p^nalites indiqu^es a I'Article 8. La visite des marchandises aux Douanes situ^es sur la route se Fera conformement aux regies indiqu^es k I'Article 3. Les marchandises Chinoises que les marchands Russes ach^teront a Sou-tcheou (Tsia-yu-kouan) ou qu'ils y ameneront des marches de I'lnt^rieur en destination de la Russie, auront a acquitter, a leur exportation de Sou-tcheou en Russie, les droits fix^s pour les marchandises exportees de Tien-tsin, et seront souraises aux r^gle- ments ^tablis pour ce port. Art. IL Les marchandises achet^es a Tonn-tcheou auront k acquitter. a leur exportation en Russie par voie de terre, les droits "de sortie entiers, selon le Tarif. Les marchandises achet^es k Kalgan acquitteront dans cette ville, k leur exportation en Russie, un droit Equivalent k la moitie des droits specifies' dans le Tarif. Quant aux marchandises achet^es par les n^gociants Russes sur les marches interieurs et import^es ^ Toun-tcheou et Kalgan, pour etre exportees de Ik en Russie, elles seront, en outre, frapp^es de droits de transit, conform^ment aux regies g^n^rales Etablies pour le commerce Stranger sur les marches intErieurs. Les Douanes locales des villes ci-dessus enumErEes, aprEs avoir prEleve les droits, dEhvreront au marchand un permis pour le transport des marchandises. Pour les marchandises exportees de Toun-tcheou, ce permis sera dElivrd par la Douane de Dounba, k laquelle se feront la demande de ce permis, ainsi que le versement des droits que les marchandises auront a acquitter. II sera fait mention dans le permis de la defense de vendre les marchandises en route. Les regies detaillEes k I'Article 3, relatives aux permis, k la visite des marchandises, &c., se rapportent egalement aux marchandises export^es des ]ocalit6s ^num^r^es dans le present Article. Art. 12. Les marchandises de provenance ^trang^re, exportees en destination de la Russie, par voie de terre, de Tien-tsin, de Toun-tcheon, de Kalgan, et de Sou-tcheou (Tsia-yu-kouan), a'auront pas de droits a acquitter si le marchand produit un regu de la Douane accusant paiement des droits d'importation et de transit sur ces marchandises. Si elles n'ont acquitt^ que les droits d'entr^e, la Douane com- p6tente r^clamera, en outre, du n^gociant, le versement du droit de transit fixe par le Tarif. Art. 13. Les marchandises import^es en Chine par les raarchands Russes, ou export6es par eux, acquitteront les droits de Douane, selon le Tarif General 6tabli pour le commerce Stranger en Chine, et selon le Tarif Additionnel etabli en 1862 pour le commerce Russe, Les marchandises non ^num^r^es dans I'un ou dans I'autre de ces Tarifs seront impos^es d'un droit de 5 pour cent ad valorem. Art. 14. Seront admis, en franchise de droits, a I'importation- et a I'exportation, les articles suivantes : — L'or et I'argent en lingots, la monnaie 6trang^re, les farines de toute espece, le sagou, les biscuits, les viandes et les 16gumes en conserves, le fromage, le beurre, les produits de confiserie, les vetements etrangers, les objets de joaillerie et I'argenterie, les parfums et les savons de toute espece, le charbon de bois, le bois de chauffage, les bougies de fabrication ^trang^re, le tabac et les cigares Strangers, les vins, la bi^re, les boissons spiritueuses, les provisions et utensiles de manage, employes dans les maisons et sur les navires, le bagage des voyageurs, les fournitures de chancellerie, les articles de tapisserie, la coutellerie, les medica- ments Strangers, la verroterie, et les objets en cristal. Les articles ci-dessus enumeres passeront en franchise de droits, a leur entree et a leur sortie par voie de terre ; mais s'ils sont expedi^s, des villes et des ports mentionn^s dans le present R^glement, sur les marches interieurs, ils seront frappes d'un droit de transit au taux de 2^ pour cent ad valorem. Seront, toutefois, exempts du paiement de ce droit : le bagage des voyageurs, L'or et I'argent en lingots, et la monnaie etrang^re. Art. 15. Sont prohib^s tant pour I'importation que pour I'exportation, et sont sujetsa confiscation dans le cas de transport en contrebande, les articles suivants : — ' La poudre, les munitions d'artillerie, les canons, les fusils, les' carabines, les pistolets, et toutes les armes k feu. Les engins et munitions de guerre, le sel, i'opium. Les sujets Russes se rendant en Chine pourront avoir, chacun pour leur defense personnelle, un fusil ou un pistolet, ce dont mention devra ^tre faite dans le permis dont ils seront porteurs. L'importation, par les sujets Russes, du salpfetre, du soufre, et du plomb, n'est admise que sur une autorisation speciale des autorit^s Chinoises, et ces articles ne pourront 6tre vendus qu'aux sujets Chinois qui auront re^u ua permis d'achat sp^cital. L'exportation du riz et de la monnaie de cuivre Chinoise est prohibee. Par contra, I'importation du riz et de toutes les cereales est autoris^e en franchise de droits. Art. 16. 11 est interdit aux negociants Russes de transporter les marchan- dises appartenant k des commeryants Chinois, en les faisant passer pour leur propriety. Art. 17. Les autorit^s Chinoises auront le droit de prendre telles mesures que seront n^cessaires contre le commerce de contrebande. Fait a St. P^tersbourg, le if F^vrier, 1881. (Sign6) NICOLAS DE GlERS. (Signe) TS-ENG . (L.S.) (L.S.) (Sign6) EUGENE BUTZOW. (L.S.) [3921 C 2 10 Annexe a I' Article 2 du Reglement pour le Commerce par Voie de Terre. LiSTE des Points-Fronti^res par lesqiiels pourront passer les sujets Russes, se rendant en Chine pour affaires de Commerce. Postes Russes. Postes Chlnois. I. Staro-Tsouroukhaitouisky. Khouboltchjikhou. 2. Tsagan-Oloievsky. Tzerintou. 3. Klioutchevsky. Mookgh^dz^ghd. 4. Kouloussoutaievsky. Ouliantou. 5. Tchassoutch^ievsky. Dorolok. 6. Douroulgouievsky. Khorine-narassou. 7. Tokhtorsky. Khouratsa. 8. Baiandarga. 9. Achinginsky. Achingra. 10. Mentzinsky. Mindza. 11. Charagolsky. Ouialga. 12. Koudarinsky. Koudara. 13. Kiakhta. Kiakhta. 14. Botsiisky. Khara-khoutchjir. 15. Jeltourinsky. Tchjirgh^tey. 16. Kharatsaisky. Ortokho. 17. Khamneisky. Irektchilam. 18. Klioutchevskoi. Ouioulet. 19. Khanghinskv. Byltys. 20. Okinskv. Tsai-gool. 21. Tchjintchjilik. 22. Joustyt. 23. Souok. 24. Tsagan-obo. 25. Bourgassoutai. 26. Khabar-oussou 27. Bakhty. 28. Kaptagai. 29. La passe Kok-sou. 30. Khorgos. 31. La passe B^ddl. 32. La passe T^rdkty. 33. La passe Tourougarte. 34. La passe Souiok. 35 Irkechtam. La pr^sente liste de points de passage pourra 6tre modifi6e par une entente entre Envoy6de Russie k P^kin et le Ministere des Affaires Etrang^res de Chine daprds les donnees relatives aux avantages de ces points qui leur seront fournies par les Consuls de Russie et par les autorites fronti^res Chinoises. Ces modifications porteront sur 1 exclusion de certains points qui seront reconnus superflus, ou sur leur remplacement par d'autres, plus n^cessaires an mouvement du commerce (Sign6) NICOLAS DE GIERS. (Sign^) TSENG. (Sign^) EUGilNE BUTZOW. ^^'^"^ (L.S.) A ces causes aprSs avoir suffisamment examine ce Traits, nous I'avons affr^6 confirm^ et ratifi^, comme par les presentes, nous I'agr^ons confirmonsjet rations dans toute sa teneur, promettant sur notre parole Tmp^riale, pour nous nos h^ritiers et successeurs,que tout ce qui a ^t6 stipule dans ce Trait/serl obser'v6 et ex^cut6 mvio lablement En foi de quoi nous avons sign^ de no re prop^e Sn ll pr^sente ratification Lnp6nale, et nous y avons fait'apposer le Tcea'u deTotit L'original est sign^ de la propre main de Sa Majesty I'Empereur, ainsi : T ^/ ^j ^T- - V (S'gn^) ALEXANDRE. Le G^rant du Minist^re des Affaires Etrang^res : Secretaire d'Etat, (Contresign^) Giers. 1] Proces-verbal. Les Soussign^s, Nicolas de Giers, Secretaire d'Etat, Sdnateur, Conseiller Prive actuel, dirigeant le Minist^re Imperial des Affaires Etrangeres, et Tseng, Marquis de Neyong, Vice-President de la Haute Cour de Justice, Envoye Extraordinaire et Ministre Plenipotentiaire de Sa Majeste I'Empereur de la Chine, pr^s Sa Majest6 I'Empereur de Russie, se sont r^unis a Thbtel du Ministere des Affaires Etrangdres pour proceder a l'6chang,e des actes de ratification du Traits entre la Russie et la Chine, sign^ k St. Petersbourg, le -^f F^vrier, 18S1. Apr^s lecture des instruments respectiis, lesquels ont ^t^ reconnus textuelle- ment conformes a I'acte original, I'^change de Tacte ratifi^ par Sa MajestS I'Empereur de Russie le ^g AoAt, 1881, centre I'acte ratifie par Sa MajestS I'Empereur de la Chine le 1^5- Mai, 1881, a eu lieu selon I'usage. En foi de quoi les Soussign^s ont dresse le present proces-verbal et I'ont revdta du cachet de leurs armes. Fait a St. Petersbourg le 7 Aout, 1881. (Signe) NICOLAS DE GIERS. (Signe) TSENG. (L.S.) (L.S.) (Translation.) Treaty between Russia and China concerning the Re -establishment of the Authority of the Chinese Government in Hi. HIS Majesty the Emperor and Autocrat of All the Russias and His Majesty the Emperor of China, being desirous of settling certain frontier questions concerning the interests of both Empires, and of drawing closer the friendly relations between the two countries, have named as their Plenipotentiaries, in order to arrive at an understanding on these questions : — His Majesty the Emperor of All the Russias, his Secretary of State, Nicolas de Giers, Senator, Actual Privy, Councillor, in charge of the Imperial Ministry for Foreign Affairs; and his Envoy Extraordinary and Minister Plenipotentiary at the Court of China, Eugene de Butzow, Actual Councillor of State ; And His Majesty the Emperor of China, Ts6ng, Marquis of Neyoung, Vice- President of the High Court of Justice, his Envoy Extraordinary and Minister Plenipotentiary at the Court of Russia, intrusted with special powers to sign the present Treaty as Ambassador Extraordinary. The aforesaid Plenipotentiaries, intrusted with full powers, which have beeo found sufficient, have agreed to the following stipulations : — ARTICLE I. His Majesty the Emperor of All the Russias consents to the re-establishment of the Chinese Government in the country of Hi, which has been temporarily occupied, since 1871, by the Russian forces. Russia remains in possession of the western part of that country, within the limits indicated by Article VH of the present Treaty. ARTICLE II. His Majesty the Emperor of China undertakes to issue the necessary Decrees, in order that the inhabitants of Hi, to whatever race or religion they may belong, may be freed from all' liability, whether as concerns their persons or their property, for acts committed during or after the disorders which have taken place in that country. A Proclamation in conformity with this undertaking will be addressed by the Chinese authorities, in the name of His Majesty the Emperor of China, to the people of Hi, before that country is made over to the said authorities. ARTICLE III. The inhabitants of Hi will be at liberty to remain in the places where they at present reside as Chinese subjects, or to emigrate to Russia and to adopt Russian nationality. They will be called upon for a decision on the subject before Chinese authority is re-established in Hi, and a term of one year, to be reckoned from the date of the restoration of the country to the Chinese authorities, will be granted 12 to [those who express a wish to emigrate to Russia. The Chinese anthorities will place no obstacles in the way of their emigration and of the removal oi their personal property. AETIOLE IV. Russian subjects holding land in Hi will retain their rights of ownership, even after the re-establishment of the authority of the Chinese Government in that country. This arrangement does not apply to those inhabitants of Hi who adopt Russian nationality at the time of the re-establishment of Chinese authority in that country. Russian subjects whose lands are situated outside the areas assigned for Russian factories, in virtue of Article XIII of the Kuldja Treaty of 1851, will pay the same taxes arid contributions as Chinese subjects. ARTTGLE V. The two Governments will send to Kuldja Commissioners, who will proceed on the one part to cede and on the other to resume the administration of the Province of Hi, and to whom will be confided, in general, the execution of the stipulations of the present Treaty which relate to the re-establishment in that country of the authority of the Chinese Government. The said Commissioners will carry out their instructions in accordance with the understanding to be arrived at as to the manner of ceding on the one part, and of resuming on the other, the administration of Hi, between the Governor-General of Turkestan and the Governor-General of the Provinces of Chan-si and Kan-sou, to whom the management of this business has been intrusted by the two Governments. The transfer of the administration of Hi should be concluded within a term of three months or earlier, if possible, to date from the day of the arrival at Tashkend of the official delegated by the Governor-General of Chan-si and Kan-sou to the Governor-General of Turkestan to notify to him the ratification and promulgation of the present Treaty by His Majesty the Emperor of China. ARTICLE VI. The Government of His Majesty the Emperor of China will pay to the Government of Russia the sum of 9,000,000 metallic roubles, to meet the expenses of the occupation of Hi by Russian troops since 1871, to satisfy all pecuniary claims which have been brought forward up to this date for losses of Russian subjects whose goods have been plundered in Chinese territory, and to assist the families of Russian subjects killed in armed attacks of which they have been the victims in Chinese territory. The above-mentioned sum of 9,000,000 metallic roubles is to be paid within a term of two years from the date of the exchange of the ratifications of the present Treaty, in the order and in accordance with the conditions agreed to by the two Governments in the special Protocol annexed to the present Treaty. ARTICLE VII. The western part of Hi is incorporated with Russia, to serve as a place for the establishment of the inhabitants of that country who adopt Russian nationality and who will therefore have had to abandon the lands they possessed. The frontier between the Russian possessions and the Chinese Province of Hi starting from the Bedjin-Taou Mountains, will follow the course of the Khorffos River as far as the spot where it falls into the River Hi, and, crossing this last river, will take a southerly direction, towards the Ouzontaou mountains, leaving the village of Koldjat on the west. From this point it will follow in a southerly direction the line laid down by the Protocol signed at Tchougoutchak in 1864. ARTICLE VIII. A portion of the frontier-line to the east of Lake Zaisan, as laid down by the Protocol signed at Tchougoutchak in 1864. having been found incorrect the two Governments will nominate Commissioners who will jointly modify the former line in such a manner as to correct the errors pointed out, and to estiblish a suffic'ient separation between the Kirghiz tribes subject to the two Empires. 13 The new line shall, as far as possible, take a direction intermediate between the old frontier and a straight line starting from the Kouitoun Mountains towards the Saoiir Mountains, and crossing the Tcherni-Irtych. ARTICLE IX. The two Contracting Parties will name Commissioners for erecting boundary- posts upon the line fixed by Articles VII and VIII, as well as upon that portion of the frontier where no posts have been erected. The time and place of meeting of these Commissioners will be settled by an understanding between the two Governments. The two Governments will also name Commissioners to examine the frontier and to erect boundary posts between the Russian Province of Ferganah and the western part of the Chinese Province of Kachgar. These Commissioners will take the present frontier as the basis of their labours. ARTICLE X. The recognized Treaty right of the Russian Government to appoint Consuls at Hi, at Tarbagatai, at Kachgar, and at Ourga is henceforward extended to the towns of Sou-Tcheou (Tsia-yu-kouan) and Tourfan. In the following towns : Kobdo, Ouliassoutai, Khami, Ouroumtsi, and Goutchen, the Russian Government will establish Consulates accordingly as they are called for by the development of commerce, and after coming to an understanding with the Chinese Government. The Consuls at Sou-Tcheou (Tsia-yu-kouan) and Tourfan will exercise Consular functions in the neighbouring districts, where the interests of Russian subjects may call for their presence. The provisions of Articles V and VI of the Treaty concluded at Peking in 1860, relating to the concession of lands for Consular dwellings, for cemeteries, and for pasturage, will be in like manner applicable to the towns of Sou-Tcheou (Tsia-yu- kouan) and Tourfan. The local authorities will assist the Consuls in finding temporary residences until the Consular houses are built. The Russian Consuls in Mongolia and the districts situated on the two slopes of the Tian-chan will, for travelling purposes and for forwarding their correspon- dence, make use of the Government postal establishments, according to the stipu- lations of Article XI of the Treaty of Tien-tsin and Article XII of the Treaty of Peking. The Chinese authorities, when called upon by them for this purpose, will afford them their aid and assistance. The town of Tourfan not being a place open to foreign trade, the right of establishing a Consulate there shall not serve as a precedent upon which to rest a similar right witli respect to the ports of China, to the internal provinces, and to Manchouria. ARTICLE XL Russian Consuls in China will communicate on business matters, either with the local authorities of their place of residence or with the superior authorities of the district or province, accordingly as the nature of the interests respectively intrusted to them and the importance or urgency of the business to be transacted may require. The correspondence between them will take the shape of official letters. As to the rules of etiquette to be observed in their interviews, they will be based upon the consideration which the officers of friendly Powers owe to one another. All q.uestions arising on Chinese territory with regard to commercial or other matters between the dependents of the two States will be examined and settled by common consent by the Consuls and the Chinese authorities. In disputes concerning commercial matters the parties may settle their differ- ences amicably by means of arbitrators chosen by both sides. If by this course an understanding cannot be arrived at, the question will be examined and settled by the authorities of the two States. Written engagements between Russian and Chinese subjects concerning orders for goods or their carriage, the hire of shops, houses, and other places, or relating to other similar transactions, may be presented for the legalization of the Consulates and of the higher local administrations whose duty it is to legalize documents presented to them. In case of the non-fulfilment of engagements contracted, the 14 Consuls and the Chinese authorities will consider as to measures calculated to insure the execution of such obligations. ARTICLE XII. Russian subjects are authorized, as heretofore, to carry on trade free of duty in Chinese Mongolia, in those localities or aimaks where there are Chinese authorities, as well as in those where there are none. Russian subjects may likewise carry on trade free of duty in the towns and other localities of the Provinces of ili, Tarbagatai, Kachgar, Ouroumtsi, and others, situated on the northern and southern slopes of the Tian-chan range, as far as the Great Wall. This privilege will be withdrawn when the development of trade neces- sitates the enactment of a Customs Tariff, in accordance with an understanding to be arrived at between the two Governments. Russian subjects may import into and export from the aforesaid provinces of China, products of every kind, no matter what their origin may be. They may effect purchases and sales either for cash or by barter; they will be entitled to make pay- ments in merchandize of all kinds. ARTICLE XIII. In the localities where the Russian Government is entitled to establish Consu- lates, as in the town of Kalgan, Russian subjects may construct houses, shops, store-houses, and other buildings on the land they may acquire by purchase, or which may be granted to them by the local authorities," in accordance with what is laid down for Ili and Tarbagatai by Article XIII of the Kuldja Treaty of 1S51. , Privileges granted to Russian subjects in the town of Kalgan, where there will be no Consulate, constitute an exception which cannot be extended to any other locality in the internal provinces. ARTICLE XIV. Russian merchants wishing to send from Russia by land goods for the inner provinces of China, may, as formerly, send them by the towns of Kalgan and Toun- Tcheou to the port of Tien-tsin, and thence to other ports and inner markets and sell them in those different localities. ' Merchants will use the same route to export to Russia goods purchased in the towns and ports above mentioned, or in the inner markets. They will likewise be entitled to proceed on commercial business to Sou-Tcheou (Tsia-yu-kouan), the terminus of Russian caravans, and will there enioy all the rights granted to Russian commerce at Tien-tsin. ARTICLE XV. Trade carried on by land by Russian subjects in the inner and outer provinces of China will be governed by the Regulations annexed to the present Treaty The commercial stipulations of the present Treaty, as well as the Res-ulations which serve as its complement, may be revised after the lapse of ten year? to date from the day of the exchange of the ratifications of the Treaty ; but if within the course of six months before that term expires, neither of the Contractine- Parties should manifest a desire to proceed to its revision, the commercial stipulations as well as the Regulations, will remain in force for a further term of ten years Trade by sea carried on bj^ Russian subjects in China will bon^e under the general Regulations established for foreign maritime commerce with China Should rt become necessary to modify these Regulations, the two Governments wH come o an understanding on the subject, ™ ARTICLE XVI. Pending the enactment of this Tari£E, the export duties levied on certain kind. «f teas of inferior quality which are at present subject to the raL estai^Hshed iS 15 teas of high quality will be lowered in proportion to value. The settlement of those duties for each kind of tea will be sought for by means of an understanding between the Chinese Government and the Russian Envoy at Peking, within the term of one year, at the outside, from the date of the exchange of the ratifications of the present Treaty. ARTICLE XVII. Differences of opinion having heretofore arisen as to the application of Article X of the Treaty concluded at Peking in 1860, it is hereby .agreed that the stipulations of the aforesaid Article concerning the settlement of claims arising out of the theft or driving of cattle across the frontier will in future be interpreted to mean that parties found guilty of theft or driving astray will be condemned to pay the real value of the cattle not restored to the owners. It is understood that, in case of the insolvency of the guilty parties, the indemnity to be paid for the missing cattle shall not fall upon the local authorities. The frontier authorities of both States will prosecute with the full rigour of the laws of their country parties guilty of driving astray or stealing cattle, and will take such measures as may lie in their power to restore to the rightful owners cattle which has been driven astray or which has crossed the frontier. The tracks of cattle driven astray, or which have crossed the frontier, may be pointed out not only to the frontier guards, but also to the elders of the nearest villages. ARTICLE XVIII. The stipulations of the Treaty concluded at Aigoun on the 16th May, 1858, con- cerning the rights of the subjects of the two Empires to navigate the Amour, the Soungari, and the Oussouri, and to trade with the inhabitants of riverain places, are and remain confirmed. Both Governments will proceed to the establishment of an understanding con- cerning the mode of applying the said stipulations. ARTICLE XIX. The provisions of former Treaties betweeen Russia and China, not modified by tlie present Treaty, remain in full force. ARTICLE XX. The present Treaty, after having been ratified by the two Emperors, will be promulgated in either Empire for the information and guidance of all persons con- cerned. The ratifications will be exchanged at St. Petersburgh within six months from the date of the signature of the Treaty. Having settled the aforesaid Articles, the Plenipotentiaries of the two Contracting Parties have signed and sealed two copies of the present Treaty in the Russian, Chinese, and French languages. Of the three texts duly collated and found to correspond, the French text shall be held to be authoritative for the interpretation of the present Treaty. • Done at St. Petersburgh the 12th February, 1881. (Signed) NICOLAS DE GIERS. (Signed) TSENG. (L.S.) (L.S.) (Signed) EUGfiNE BUTZOW. (L.S.) Protocol. In virtue of the Vlth Article of the Treaty signed this day by the Plenipoten- tiaries of the Russian and Chinese Governments, the Chinese Government will pay to the Russian Government the sum of 9,000,000 metallic roubles to meet the expenses of the occupation of Ili by Russian troops, and to satisfy divers pecuniary claims of Russian subjects. This sum is to be paid within a term of two years from the date of the exchange of the ratifications of the Treaty. In order to fix the mode of payment of the aforesaid suin, the Undersigned have agreed as follows : — The Chinese Government will pay the equivalent of the sum of 9,000,000 roubles in pounds sterling, viz., 1,431,664^. 2s., to Messrs. Baring, Brothiers, and Co., of [392J D 16 London, in six equal parts of 238,610/. 13s. Sd. each, less the usual banking charges- incurred by the transfer of these payments to London. . A space of four months shall intervene between the payments, the first being; effected four months after the exchange of the ratifications of the Treaty signed' this day, and the last after the completion of two years from the date of that exchange. The present Protocol will have the same force and value as if it had been inserted word for word in the Treaty signed this day. In token of which the Plenipotentiaries of the two Governments have signed the present Protocol and have affixed their seals to it. Done at St. Petersburgh the 12th February, 1881. (Signed) NICOLAS DE GIERS. (Signed) TSENG. ^ " (L.S.) (L.S.) (Signed) EUGSNE BUTZOW. (L.S.) Regulations for the Land Trade. Article I. A trade by free exchange and free of duty (free trade) between Russian and Chinese subjects is authorized within a zone extending for 50 versts (100 li) on either side of the frontier. The supervision of this trade will rest with the two Governments in accordance with their respective frontier regulations. Art. 2. Russian subjects proceeding on business to Mongolia and to the districts situated on the northern and southern slopes of the Tian-chan Mountains may only cross the frontier at certain points specified in the list annexed to these Regulations. They must procure from the Russian authorities permits in the Russian and Chinese languages, with Mongolian and Tartar translations. The name of the owner of the goods, or that of the leader of the caravan, a specification of the goods, the number of packages, and the number of heads of cattle may be indicated in the Mongolian or Tartar languages, in the Chinese text of these permits. Merchants, on enteripg Chinese territory, are bound to produce their permits at the Chinese post nearest to the frontier, where, after examination, the permit is to be countersigned (''vise") by the chief of the post. The Chinese authorities are entitled to arrest merchants who have crossed the frontier without a permit, and to make them over to the Russian authorities nearest to the frontier, or to the Competent Russian Consul, for the infliction of a severe penalty. In case of the permit being lost, the owner is bound to give notice to the nearest Russian Consul, in order that a fresh one may be issued to him, and to mform the local authorities, in order to obtain a temporary certificate which will enable him to pursue his journey. Merchandize introduced into Mongolia and the districts situated on the slopes of the Tian-chan, but which have found no sale there, may be forwarded to the towns of Tien-tsin and Sou-Tcheou (Tsia-yu-kouan), to be sold or to be sent farther mto Chma. With regard to the duties on such merchandize, to the issue of permits for its carnage, and to other Customs formalities, proceedings shall be taken in accordance with the lollowing provisions. Art. 3. Russian merchants forwarding goods from Kiaklita and the Nertchinsk country tj; Tien-tsm must send them by way of Kalgan, Dounba, and Toun-Tcheou. Merchandize forwarded to Tien-tsin from the Russian frontier by Kobdo and Koui- houa-lcher is to follow the same route. Merchants must be provided with transport permits issued by the Russian authorities, and duly vise by the competent Chinese authorities, which must give, in the Chinese and Russian languages, the name of the owner of the goods, the number of packages and a description of the goods they contain. r„. J-^e officials oi the Chmese custom-houses situated on the road by which merchandize IS forwarded, will proceed, without delay, to verify the number of the packages, and to examine the goods, which they will allow to pass onwards, after affixing a msa to the permit. 17 Packages opened in the course of the Customs examination will be closed again at the custom-house, the number of packages opened being noted on the permit. The Customs examination is not to last more than two hours. The permits are to be presented within a term of six months at the Tien-tsin Custom-house to be cancelled. If theowner of the goods finds this term insufficient, he must at the proper time and place give notice to the Chinese authorities. In case of the permit being lost, the merchant must give notice to the authorities who delivered it to him to obtain a duplicate, and must for that purpose make known the number and date of the missing permit. The nearest custom-house on his road, after having ascertained the accuracy of the merchant's declaration, will give him a provisional certificate, accompanied by which his goods may proceed on their journey. An inaccurate declaration of the quantity of the goods, if it be proved that it was intended to conceal sales effected on the road, or to escape payment of duty, will render the merchant liable to the infliction of the penalties laid down by Article 8 of the present Regulations. Art. 4, Russian merchants who may wish to sell at Kalgan any portion of the goods brought from Russia must make a declaration to that effect to the local autho- rities within the space of five days. Those authorities, after the merchant has paid the whole of the entrance duties, will furnish him with a permit for the sale of the goods. Art. 5. Goods brought by Russian merchants by land from Russia to Tien-tsin will pay an entrance duty equivalent to two-thirds of the rate established by the Tariff. Goods brought from Russia to Sou-Tcheou (Tsia-yu-kouan) will pay in that town the same duties and be subject to the same regulations as at Tien-tsin. Arte 6. If the goods left at Kalgan, having paid the entrance duties, are aot sold there, their owner may send them on to Toun-Tcheou or to Tien-tsin, and the Customs authorities, without levying fresh duties, will repay to the merchant one- third of the entrance duty paid at Kalgan, a note to that effect being made on the permit issued by the Kalgan Custom-house. Russian merchants, after paying transit dues, i.e., one-half the duty specified in the Tariff, may forward to the internal markets goods left at Kalgan which have paid the entrance dues, subject only to the general regulations established for foreign trade in China. A tra,nsport permit, which is to be produced at all the custom-houses and barriers on the road, will be delivered for these goods. Goods not accompanied by such permit will have to pay duty at the custom-houses they pass, and li-kin at the barriers. Art. 7. Goods brought from Russia to Sbu-Tcheou (Tsia-yu-kouan) maybe for- warded to the internal markets under the conditions stipulated by Article 9 of these Regulations for goods forwarded from Tien-tsin destined for the internal markets. Art. 8. If it be ascertained, when the Customs examination of goods brought from Russia to Tien-tsin takes place, that the goods specified in the permit have been withdrawn from the packages and replaced by others, or that their quantity (after deducting what has been left at Kalgan) is smaller than that indicated in the permit, the whole of the goods included in the examination will be confiscated by the Customs authorities. It is understood that packages damaged on the road, and which, consequently, have been repacked, shall not be liable to confiscation, providing always that such damage has been duly declared at the nearest custom-house, and that a note to such effect has been made by that office after it has ascertained the untouched condition of the goods as at first sent off. Will be liable to confiscation, goods concerning which it is ascertained that a portion has been sold on the road. If goods have been taken by bye-ways in order to evade their examination at the custom-houses established on the routes indicated in Article 3, the owner will be liable to a fine equal in amount to the whole entrance duty. If a breach of the aforesaid regulations has been committed by the carriers, without the knowledge or connivance of the owner of the goods, the Customs authorities will take this circumstance into consideration in determining the amount of the fine. This provision only applies to localities through which the Russian land trade passes, and is not applicable to similar cases arising at the ports and in the interior of the provinces. [392] D 2 18 When goods are confiscated the merchant is entitled to release them by pa,ying the equivalent of their value, duly arrived at by an understanding with the Chinese authorities. Art. 9. On the exportation by sea from Tientsin to some other Chinese port opened to foreign trade by Treaty of goods brought from Russia by land, the Tien- tsin Customs will levy on such goods one-third of the Tariff duty, in addition to the two-thirds already paid. No duty shall be levied on these goods in other ports. Goods sent from. Tien-tsin or the other ports to the internal markets are subject to transit dues {i.e., half of the Tariff duty) according to the general provisions laid down for foreign trade. Art. 10. Chinese goods sent from Tien-tsin to Russia by Russian merchants must be forwarded to Kalgan by the route indicated under Article 3. The entire export duty will be levied on these goods when they leave the country. Nevertheless, reimported goods bought at Tien-tsin, as well as those bought in another port and forwarded in transitu to Tien-tsin to be exported to Russia, if accompanied by a Customs receipt for the export duty, shall not pay a second time, and the half reimportation duty (coasting duty) paid at Tien-tsin will be repaid to the merchant if the goods upon which it has been paid are exported to Russia within a year from the time of such payment. For the transport of goods in Russia, the Ru.ssian Consul will issue a permit indicating in the Russian and Chinese languages the name of the owner of the goods, the number of packages, and the nature of the goods they contain. These permits will be vise by the port Customs authorities, and must accompany the goods, for production when they are examined at the custom-houses on the road. The rules given in detail in Article 3 will be observed as to the term within which the permit is to be presented to the Custom-house to be cancelled, and as to the proceedings in case of the permit being lost. Goods will follow the route indicated by Article 3, and are not to be sold on the road; a breach of this rule will render the merchant liable to the penalties provided for under Article 8. Goods will be examined at the custom-houses on the road in accordance with the Rules laid down under Article 3. Chinese goods bought by Russian merchants at Sou-Tcheou (Tsia-yu-kouan), or brought by them from the internal markets to be forwarded to Russia, on leaving Sou-Tcheou for Russia, will have to pay the duty leviable upon goods exported from Tien-tsin, and will be subject to the regulations established for that port. Art. 11. Goods bought at Toun-Tcheou, on leaving that place for Russia by land, will have to pay the full export duty laid down by the Tariff. Goods bought at Kalgan will pay in that town, on leaving for Russia a duty equivalent to half the Tariff rate. Goods bought by Russian merchants in the internal markets, and brought to loun-lcheou ano Kalgan to be forwarded to Russia, will moreover be subject to transit dues, according to the general rules established for foreign trade in the mternal markets. The local custom-houses of the aforesaid towns, after levying the duties will give the merchant a transport permit for his goods. For goods leaving Toun- Tcheou this permit will be issued by the Dounba Customs authorities, to whom application IS to be made for it, accompanied by payment of the duties to which the goods are liable. This permit will mention the prohibition to sell goods on the road The rules g,ven in detail in Article 3 relative to permits, tlTe examination of m til's ArticTe ''^'^'' '" ™''""^' ^"^ ^"""^^ exported from the places mentioned m u ^''^■J^; ^""d«of foreign origin sent to Russia by land from Tien-tsin Toun- Tcheou, Kalgan, and Sou-Tcheou (Tsia-yu-kouan) will Jav no duty if the merchant rutnn%h?sfrodri?'.r'"r^^'^";^ paymenf of the import Ldlransi auties on those goods. If they have only paid entrance duties, the comoetent by thTTaX " '"" "P°" '^' "'''^^"' '■"^ '^' P^y'"^"^ «f ^he t^anstt duTfiS Art. them, wil with Chi 1862. ad ™t™ duty""'""'''''' '" ""•" "f '""^^ ^^"^' "'" "^ object to a 5 per cent. 19 Art. 14. The following articles will be admitted free of export and import duty :— Gold and silver ingots, foreign coins, flour of all kinds, sago, biscuits, preserved meats and vegetables, cheese, butter, confectionery, foreign clothes, jewellery and silver plate, perfumery and soaps of all kinds, charcoal, firewood, candles of foreign manufacture, foreign tobacco and cigars, wine, beer, spirits, household stores and utensils to be used in houses and on bo'ard ship, travellers' luggage, official stationer}', tapestries, cutlery, foreign medicines, glass ware and ornaments. The above-mentioned articles will pass free of duty on entering and on leaving by land ; but if they are, sent from the towns and ports mentioned in these Regula- tions to the internal markets, they will pay a transit duty of 2^ per cent, ad valorevu Travellers' luggage, gold and silver ingots, and foreign coins will, however, not pay this duty. Art. 15. The exportation and importation of the following articles is prohibited, under penalty of confiscation in case of smuggling: — Gunpowder, artillery ammunition, cannon, muskets, rifles, pistols, and all fire- arms. Engines and ammunition of war, salt, and opium. Russian subjects going to China may, for their personal defence, have one musket or one pistol each, of which mention will be made in the permit they are provided with. The importation by Russian subjects of saltpetre, sulphur, and lead is allowed only under special license from the Chinese authorities, and those articles may only be sold to Chinese subjects who hold a special purchase-permit. The exportation of rice and of Chinese copper coin is forbidden. On the other hand, the importation of rice and of all cereals may take place duty free. Art. 16. The transport of goods belonging to Chinese merchants is forbidden to Russian merchants attempting to pass them off as their own property. Art. 17. The Chinese authorities are entitled to take the necessary measures against smuggling. Done at St. Petersburgh, the ^Jth February, 1881. (Signed) NICOLAS DE GIERS. (Signed) TSENG. (L.S.) (L.S.) (Signed) EUGfiNE BUTZOW. (L.S.) Annex to Article 2 of the Regulations for the Land Trade. List of Frontier Points which Russian subjects may pass in going to China for trading pu poses. Russian Posts. Chinese Posts. 1. Staro-Tsouroukhaitouisky. Khouboltchjikhou. 2. Tsagan-Oloievsky. Tzerintou. 3. Klioutchevsky. Mookgh^dzdghe. 4. Kouloussoutaievsky. Ouliantou. 5. Tchassoutch^ievsky. Dorolok. 6. Douroulgouievsky. Khorine-narassou. 7. Tokhtorsky. " Khouratsa. 8. Baiandarga. 9. Achinginsk}-. Achingra. 10. Mentzinsky. Mindza. 11. Charagolsky. Ouialga. 12. Koudarinsky. Koudara. 13. Kiakhta. Kiakhta. 14. Botsiisky. Khara-khoutchjir. .15. Jeltourinsky. Tchjirghetey. 16. Kharatsaisky. Ortokho. 17. Khamneisky. Irektchilam. 18. Klioutchevskoi. Ouioulet. 19. Khanghinsky. Byltys. 20. Okinsky. Tsai-gool. 21. Tchjintchjilik. 22. ■ Joustyt. 23. Souok. 20 24. Tsagan-obo. 25. Bourgassoutai. 26. Khabar-oussou. 27. Bakhty, 28. Kaptagai. 29. The Kok-squ Pass. 30. Khorgos. 3J . The Beddl Pass. 32. The Ter^kty Pass. 33. The Tourougarte Pass. 34. The Souiok Pass. 35. Irkdchtam. The present list of points for passage may be modified by an understanding between the Russian Envoy at Peking and the Minister for Foreign Affairs in China, according to the data furnished to them by the Russian Consuls and by the Chinese frontier authorities as to the advantages of those points. These modifications will deal with the exclusion of certain points which may be recognized as superfluous, and with the substitution of others more advantageous to trade. (iSgned) NICOLAS DE GIERS. (Signed) TSENG. ^ (L.S-) (L.S.) (Signed) EUGfiNE BUTZOW. (L.S.) On these grounds, after having sufficiently examined this Treaty, we have approved, confirpied, and ratified it, and by these presents we approve, confirm, and ratify it in all its parts, promising on our Imperial word, for ourselves, our heirs, and successors, that all that is stipulated by this Treaty shall be inviolably observed and executed. In faith of which we have signed with our own hand the present Imperial ratification, and we have had affixed to it the seal of our Empire. The original is signed by the Emperor's own hands, thus : (Signed) ALEXANDER. (Countersigned) Giers, Secretary of State, In charge of the Ministry for Foreign Affairs. Minutes. The Undersigned, Nicolas de Giers, Secretary of State, Senator, actual Privy Councillor, m charge of the Imperial Ministry for Foreign Affairs • and Tsene" Marquis of Neyong, Vice-President of the High Court of Justice, Envoy Extra- ordmary and Mmister Plenipotentiary of His Majesty the Emperor of China to His Majesty the Emperor of Russia, have met at the Foreign Office to exchange the acts of ratification of the Treaty between Russia and China, signed at St. Peters- burgh, on the ifth February, 1881. After reading the respective instruments, which have been recognized as ihf^rll"'™ Ti° ''"^.T* A'u\*^' exchange of the act ratified by Hi! Majesty theEraperor of Russia on the -^th August, 1881, for the act ratified by the Emperor of China on the ^^ May, 1881, has taken place according to custom ^^"^P^ror In faith of which the Undersigned have drawn out the present Minutes and have affixed to them the seals of their arms. Fi«^«iit iviinutes ana Done at St. Petersburgh, the 7th August, 1881 (Signed) NICOLAS DE GIERS. (Signed) TSENG (^•^•) (L.S.) g a., s o 1 o ^ s^ l! 5 f ^ ■■s- ^3 * a "« ,_j s- 00 s 00 ^ bS .<>' (^ O 3 SL S-^ 2. *^ 09 s_ w (-»-' «■ sr s fls o Cb o 1 IK o rt- Q e-*- CM •T3 •-i n SL S" p> >f 5*. Cfi 5" BQ -» c*- OS »- B* o <^ ^ '^ >^ a CD o t^ 3. Merchants desiring to convey foreign merchandize into the interior, and wishing to pay the transit duty and take out a eertifioate, are, by Treaty, entitled to such a certificate. At some places, however, no application for certificates had yet been made. All at once an application is made, and the local authorities, with the intention of taking measures for the prevention of fraud, proceed in the first place to make Eegulations in concert with the foreign ofilcials. This proceeding is in conformity with the Treaties. It is not the case that certificates are refused altogether, or that arbitrary condi- tions are imposed. 4. The transit certificates which merchants take out to convey foreign goods into the interior, by Treaty, intended to serve as a proof that they have been vised at every barrier. If any case arises of a certificate being produced and ignored, it is the duty of the Yamen, as soon as the matter is brought to its notice, to call upon the high authorities of the province to investigate the case and take action in the matter. 5. Merchants transporting foreign goods into the interior which are covered by a transit certificate should, according to Treaty, exhibit the certificate at every barrier en route, to be vise'd and stamped, after which the goods are allowed to pass on. Any attempt to pass goods in excess of the amount entered on the certificate renders all goods of that description liable to confiscation. But except in such cases, if the barrier officials extort illegal fees, or detain merchandize on other pretexts, it becomes the duty of the Yamen, as soon as the matter is brought to its notice, to instruct the high provincial authorities to investigate the case and punish the offenders. 6. The Tariff rules state that when foreign merchandize is being sent into the interior, the merchant interested shall go to the custom-house, declare the place to which the goods are consigned, and pay the transit dues, whereupon the Customs wUl issue a certificate which will be examined at every barrier en route, and no further charges shall be imposed on the goods, no matter how distant the places of their destination. The certificate thus ceases to run beyond the place declared by the merchant, no matter what the distance may be. The goods having reached the place declared in the certificate, this document becomes of no use. 7. Foreign merchants are, by Treaty, authorized to lease land and build ware- houses for the storage of their merchandize. There exist regulations which were sent to aU the ports by the late British Minister, Sir P. Bruce, forbidding foreign merchants to build warehouses in the interior, the object being to guard against abuses arising out of the storage of merchandize. So far as the transport of merchandize is concerned, foreigners are authorized by Treaty to hire native boats for the conveyance of merchandize ; and in the Yangtge Regulations, there is also a clause authorizing foreigners to hire native vessels for the carriage of merchandize. Both these Hegulations were framed in order to give an out- let to foreign goods In the matter .of the storage of goods or transport of merchandize, the stimulations of the Treaties must of course be observed. 8. In the provinces there are certain fixed places where custom-houses — not the foreign Customs— exist. But as regards li-kin stations, their number has been in- creased or diminished as seemed necessary to the respective provincial Governments. In recent years, some stations have been abolished, while no new ones have been opened. It has never happened that a li-kin station has been established without the express orders of the high authorities of the province. 9. The Tariff in force at the custom-houses is published in all the Treaties, and the Tariff in force at the native custom-houses is to be found in the Eegulations of the Board of Bevenue which have been published for many years. The li-kin tax was instituted to supply funds for military operations. It did not originally come under the established Regulations. For this reason the K-kin Rules were not published in the provinces at the same time as the others. 10. Merchants transportmg foreign goods into' the interior are entitled to a, transit certificate, and foreigners going into the interior to purchase native produce, are entitled to an export transit certificate. Merchandize unaccompanied by a certifi- cate is entitled to a receipt for any payment made to-any custom-house or li-kin station en route. If a receipt be refused without cause, on the matter being brought to the notice of the Yamen, instructions will at once be sent to the high provincial authorities to make inquiry and take action. ri238l n 8 11. Certificated goods having once paid duty, no further paynient should, in infraction of Eegulations, be demanded by any custom-house or Zi-to station, bnouia such a case arise, it is incumbent on the high authorities of the province to inquire into the matter and to punish, according to the law of China, any officer who has committed an oflPence. , . , „i„-„r, t.„„„ 12. Merchants provided with transit certificates, and conveymg goods which have paid duty, are undoubtedly entitled to be reimbursed if, in violation of Begu^tioDS, they are taxed in excess at any customs station or li-kin harrieren route, -fut the merchant's one sided statement cannot be accepted as conclusive. The higJi autnonties of the province, before taking action, have to ascertain whether the facts are as_stated. It not unfrequently happens that a considerable time is occupied m mvestigatmg counter-statements backwards and forwards before a matter can be settled. 13. The same as No. 3. . . j • i vx 14. In every province of China, the lo-ti duty has always existed m any locahty which produces anything. The duty is known as miscellaneous duty. On such pro- duce the duty is always paid by the producer to the Chinese hong for remittance to the provincial Treasury, without regard to the fact of there being a purchaser for the produce or not. The duty has been in existence for over two hundred years, and has nothing to do with the customs or transit duty ; nor is it in any way connected with inland custom-houses or li-kin stations. It is not only on silk that the duty is im. posed ; it exists wherever there is an article of local production. 15. The General Trade Regulations provide that if a foreigner purchase at a port produce on which the native dealer has already paid aH inland dues, the duty and li-kin thus paid en route by the native dealer is held to clear the half-duty due by the foreigner. But whether the produce bought at the port by the foreigner from the Chinese is the same produce as has already paid duty and li-kin is a question that has to be detemained. 16. By Treaty foreigners provided with certificates for the purchase of native produce in the interior are required to pay half transit duty and export duty. On produce bought at the port, the export duty has to be paid ; but the duty and li-kin already paid by the native dealer is held to take the place of the half -duty payable by the foreigner. But if the produce undergoes a change in the process of manu- facture the new article is not the same thing as the produce originally bought, and it cannot be claimed that duty and li-kin which have been paid on one kind of article should clear the half duty due on another kind of article. 17. The Tariff Rules state that articles for the personal use of foreigners may be imported and exported at any of the open ports free of duty. Should duty have ever been imposed by mistake by the Customs it is because the goods in question were not clearly declared to be for personal use, or there was reason to suppose that the goods were intended for sale. Instructions will be given to use due discrimination. 18. The General Trade Regulations provide that foreigners carrying produce from one port to another shall pay export duty at the port of shipment, and half import duty at the port of entry. Once the goods leave the port for the interior, no matter whether in the hands of Chinese or foreigners, they shall be liable to duty at every custom- house, and to li-kin at every barrier. Thus, produce which is re-imported into any port and sent into the interior is liable, in addition to the full and half-duty, to duty and li-kin at every custom-house or barrier {encountered). There is no taxation in excess of what is legal (as alleged in Grief No. 18). 19. The Treaties state that duties payable by foreigners shaU be paid into a bank on behalf of the Superintendent of Customs, either in sycee or foreign coins, which will be taken at their market rate, and on which will be made up the amount by which they fall short of the value of pure silver. The custom-houses receive and remit duties in Treasury silver of full fineness ; the relative value of foreign coins to sycee, however, varies with time and place. The Superintendents of Customs wiU be informed that when duties are paid, the amount must be made up so as to be equivalent to Th-easury silver of full fineness. 20. The Tariff Rules provide' that the expense of maintaining lights, buoys, beacons, and the like, shall come out of the tonnage dues. Heretofore such expenses have been met out of the tonnage dues on foreign vessels at the different ports ; but now the tonnage dues collected from the Chinese steamers of the China Merchants Com- pany are also passed to this account. Inclosure 7 in No. 1. The Foreign Representatives to the Tsung-li Yamen. Peking, February 2, 1880. . THE Undersigned have the honour to acknowledge receipt of the reply of the Prince of Kung and the Ministers of the Tsung li Yam^n to the collective note regarding the taxation of foreign trade, addressed to His Imperial Highness and their Excellencies by the Representatives of the Treaty Powers upon the 10th November last. In their collective note the writers expressed a hope that they might be enabled, in an early Conference, to discuss with the Ministers of the Yamen the various matters to which they had requested attention. From the tenour of the reply now received, the Undersigned are under the impression that the note of the 10th November has been, to a certain extent, mis- stood. In order, therefore, to remove any possible misconstruction of their motives in writing it, as well as to secure the object with which it was originally written, the Undersigned venture again to request that a time be named for a Conference with the Yamen ; and they trust that when the new year festivities are concluded, it may be in the power of the Mini sters of the Yamen to meet them. The Undersigned renew, &c., (Signed) THOMAS EEANCIS WADE. M. VON BEANDT. GEORGE E. SEWARD. A. KOYANDER. PATENOTRE. Inclosure 8 in No. 1. Memorandum read by the British Minister at the Conference of November 8, 1879. AS the result of our discussion upon the relief of trade from undue taxation will shortly have to be communicated to the Tsung-li Yam^n, I shall claim permission to recall to the recollection of my colleagues here assembled iu conference, the peculiarity of my own position in relation to this question. Erom 1870 to 1874, that is to say, from the date of the rejection of Sir Rutherford Alcock's Convention, I had been attempting, in concert with my colleagues of the time being, to accomplish the object now once more engaging general attention, but ■ndth little or no efEect. In the winter of 1874-75, the young Emperor having died, and the power of the Central Government being once more placed in the hands of the Empresses Dowager as Regents, I took an early opportunity of reminding the Minister of the Tsung-li Yamen how incessant had been the complaints, both from my own and other Legations, of the slight respect paid to various obligations of the existing Treaties during the late Emperor's minority of thirteen years ; and to warn their Excellencies that, during the Empress Regency now commencing, with a prospect, in the course of nature, of no shorter lease than the last, continuance of the long-suffering which, throughout the late reign, had distinguished the policy of the Treaty Powers must not be looked for. Eor myself, as I was about to return home on leave, I should feel it my duty, I said, before my departure, to elicit from the Yamen, for the satisfaction of my Government, some kind of guarantee that improvement in the directions so frequently indicated would be seriously undertaken. News of the Yiinnan outrage reached Peking not long after I had spoken in this sense to the Ministers ; and arguing from the first that that outrage was but the outcome of a state of relations to which all the grievances that foreigners are justified in denouncing might be traced, I pressed from the first, and with instance, either for immediate removal of the causes of complaint, or for guarantees that a practical effort would be made to remove them. Setting aside here all reference to any but the complaints of the trader, in the negotiations which, with some interruption, spread themselves over about a year and a-half, I persistently urged upon the Chinese Government the concession, either of ri238l n o 10 remedial measures, or any compensatory advantages; and, as the papers published [in the Blue Book will show, I more than once stated my readiness to leave every question relating to trade to be disposed of in the negotiations undertaken by my colleague, tne Minister of Germany, with whose opinions I believed myself to be acquamted, and to whom, in the work of Treaty revision then in his hands, I had been mstructed to give ""^ 'if may be said briefly, that neither in respect of trade, nor of any graver matter discussed, did my own negotiations prove satisfactory; and m June l«7b, circum- stances which there is no need to detail, rendered it, m my opinion, expedient that I should place myself in more direct communication with Her Ma^estj s Government. I proceeded for this purpose to Shanghae. , . ^, r. j a ^ My departure from Peking led to the appointment of the Grand Secretary, Li-Hung-chang, as High Commissioner for the treatment of the questions open, and with this high officer I concluded what is known as the Ohefoo Agreement. It will' be needful to refer only to those conditions of the Agreement that affect trade, and only to certain of these. v - j The complaint of the foreign trader had been, in sum, that his trade was subjected to taxation, notably to that known as the li-kin, or patriotic contribution, not authorized by the Treaties. This taxation, although for the most part the Chinese authorities were wont to deny its illegality, they admitted to be abnormal ; a provisional means of supply, recourse to which, at first rendered necessary by the civil war but recently terminated, was still indispensable. That twenty years' struggle, to say nothing of other calamities, had deranged the normal sources of revenue, and the Empire had still upon its hands the prosecution of wars beyond the frontier, the protection of the coast, and other expenses extraordinary, which could only be met by extraordinary taxation. Believing myself that however objectionable, on this ground or that, the present system of abnormal taxation ; however gravely misapplied the revenue collected under it, abnormal taxation was none the less, and long would be, an absolute necessity in this country ; believing, at the same time, that the dissatisfaction of the native trader, if no other cause, would oblige the Chinese Government, sooner or later, to address itself to his relief from the burden now laid upon him, and that whenever the native trader came to be relieved from it, the system would not be maintained exclusively for the taxation of foreign trade, which, on the other hand, I was strongly of opinion, would continue, so long as the internal commerce of the Empire is taxed under that system, to feel its weight ; I agreed, if the Chinese Government, by the opening of additional markets to foreign shipping, would extend the area of foreign trade, to recommend my Government to assent to the levy of the imposts so long protested against as a breach of Treaty, in all the country beyond the limits of the port settle- ments. Earther, as the taxation of opium, which though imposed under the same condi- tions that, when they affect other branches of the import trade, I describe as abnormal, is not per se illegal, could no longer be affected by the old machinery, I agreed that, once the li-kin collectorates were banished from the port settlements, I would recom- mend that the foreign inspectorate should be authorized, so far as opium was concerned, to replace the li-kin collectorates. The Chefoo Agreement was to a certain extent one-sided ; for while the proposed arrangement affecting opium revenue would have to await the sanction of my own Government, and the limitation of the area of exemption from li-kin, the sanction not only of my own but of every other Government, and could therefore not be assented to otherwise than conditionally by me, the concession of the ports and places of call enumerated in the Agreement, was unconditional, and to be given effect to within six months. That the foreign Legations should be at once appealed to was therefore indis- pensable. There were other conditions of the Agreement which it was equally imperative should be approved by the Legations before they could bear fruit. Until I was assured consequently beyond doubt that the appeal had been made to them, I declined to declare the Yiinnan affair closed. The Legations having been appealed to by a Circular from the Tsung-li Yam^n, the ports and places of call were opened within six months. Her Majesty's Government has not yet formally ratifi.ed the Agreement, and it is possible, indeed, that no formal ratification of the instrument will be considered necessary. The opium question, however, if not definitively settled, is in such a position that its definitive settlement may be pronounced certain. It lies, moreover II outside tlie question immediately under review, which is the relief of foreign trade, and in particular the import trade, from taxation not authorized hy Treaty. Further allusions to it here, therefore, is hardly called for. But whatever the ultimate fate of the Agreement, the ports promised under it, I repeat, were duly opened within the time stipulated. Her Majesty's Governments if no other, has established Consulates at those ports, and some at least of the Eepresen- tatives of other Governments have so far recognized the fact that these ports are open to trade as to have taken into formal consideration the delimitation of foreign settle- ments at some if not at all of these ports. It is more than probably beyond dispute that the Chinese have credited thq concession of these ports to some other engagements than that recorded in the Chefoo Agreement. Still that instrument is as yet the only published authority for the right of foreign shipping to frequent those ports, or of the foreign trader to reside at them, and I, at least, am placed in this position, that if I join in a protestation — and the opinions so far emitted tend towards such protestation — against the right to levy li-kin in the port area, the district, that is, within the bounds of which, as exponent of the British Treaty, I had been used to contend our imports ought to be exempt from such taxation — I lay myself open to the retort that my own countrymen and others have entered upon enjoyment of the advantages derivable from the trade with new ports made accessible only by the Chefoo Agreement, while the counter-concession in the matter of li-kin taxation, which when the Chinese Government promised to open the new ports, it was at least entitled to expect would be taken into consideration, is apparently to be excluded from discussion. The BiCpresentatives of other foreign Powers are without doubt at liberty so to exclude it ; to demand, as for years we have all been demanding, the literal satisfac- tion ot Treaty rights in regard to taxation. But, for myself, I should not feel equally at liberty to exclude it unless I were first formally to propose to the Chinese Govern- ment retrocession of the privilege against which I had recommended my Government to exchange a limitation of the Treaty rights in question. The draft note prepared by the Minister of Germany, and laid before the Conference on the 3rd instant, is, I take on me to say, most happily conceived in this, that it invites propositions on the part of the Chinese Government instead of initiating demands. But in the discussion with the Tsung-li Yamen that must be looked forward to, of the list of griefs which we have been engaged for the last few days in examining, I cannot conceal from myself that individually I may have to face a charge which, as I have shown above, the Chinese will be more or less justified in bringing against me, if I join my colleagues in pressing for the unconditional satisfac- tion of a right, of the exercise of which I had engaged, under certain conditions long since fulfilled, to support the modification. Peeling this, I have thought it right to state the course that, if the case present itself, I shall think it my duty to pursue. No. 2. Acting Consul Giles to Earl Granville. — (Received September 8.) My Lord, Amoy, July 24, 1880. WITH reference to a recent speech on the opium question by the Marquis of Hartington (House of Commons, 4th June, 1880), in which his Lordship observes that : " It is very dif&cult, dealing with a country so little known as China, to estimate what amount of opium is produced in China as compared with that which is imported into it, but if honourable gentlemen wUl take the trouble of consulting the Consular Reports from China, which are laid on the table of the House, they can satisfy them- selves that a very large proportion of the opium which is consumed in that country, although authorities differ as to its exact amount, is grown in China ; and when we are told that the Chinese Government really and seriously desires to put a stop to the use of this drug altogether, and is only waiting for us to assist in prohibiting its importa- tion, and then it wiU take steps to prevent its production in China, I think they are asking us to proceed on a very doubtful assumption," I have the honour to forward herewith copy of a Report on the native-grown opium of this Consular district, recently transmitted by me to the Indian Government. I have, &c. (Signed) H. A. GILES. 12 Inclosure 1 in No. -. Acting Consul Giles to the Secretary to the Government of India. Sir, Amoy, May 31_, 1880. I HAVE the honour to inform you that the native opium crop has just been gathered in this Consular district. It is not, I must admit, of a very important character, but still I have thought it my duty to collect all possible information on the subject and lay the same before you for whatever it may happen to be vrorth. The cultivation of opium in this neighbourhood is confined exclusively to a small area just outside the walls of the district city of T'ung-an, which lies at a distance of about 20 miles from the port of Amoy. In my Trade Report for the year 1879 I have drawn attention to it in the following terms : — " There we find a small crop produced annually, "wdth reference to which no accurate statistics seem to have been given heretofore. "The T'ung-an crop is sown yearly in the middle of the Chinese eleventh moon, vphich, roughly speaking, answers to The latter part of December or the beginning of January. It is gathered in at the festival of " clear weather," or in the early days of April. The yield of the crop planted in the autumn of 1878 and gathered in the spring of 1879 amounted to 221 piculs, or 29,467 lbs. avoirdupois. Taking the good with the bad, the price averaged 380 dollars, or 111. 5s. per picul of 133-J lbs., or a total of 83,980 dollars, equal to 15,746/. 5s. All of this was consumed in the vicinity of T'ung-an, except perhaps some 10 or 20 piculs, which found its way to Amoy without payment of li-kin. Of the success of last autumn's plant small hopes are now entertained. ThB recent unusually heavy rains are believed to have destroyed more than seven-tenths of the entire crop. This cultivation of opium is carried ■on under the very noses of the authorities, the fields selected lying just outside the walls of the district city." The prediction contained above as to the failure of this year's crop has been literally fulfilled. Only 95 piculs, equal to 12,667 lbs., of a very inferior article have been obtained as the result of last autumn's sowing, at an average value of 350 dollars a-picul of 133jlbs. avoirdupois. I inclose several dried specimens of the poppy-heads from which the juice has been extracted ; also an hermetically-sealed cylinder, containing a specimen of this year's opium. It is in cylinders of the kind that the drug is usually preserved, being tlea buried in the earth with the double object of concealment from the local officials and improvement of the flavour of the contents. Thus, while the price of ordinary native opium fluctuates with the prices ruling in the market for the imported drug, the value of native opium which has lain buried for a year is increased from 10 to 20 per cent, extra. It is smoked either alone or mixed with the foreign article ; chiefly the latter, as its own flavour is alleged to be somewhat rank, and it creates hot risings in the throat. As regards official prohibition, I may add that opium appears to have been grown xit T'ung-an now for no less than thirty years, and that of late years a Proclamation has been annually posted on the walls of the district city warning people against its cultivation, under the severest penalties. I annex translation of last year's issue that for the current season not having yet been published. These documents mean nothing The officials take no steps whatever to interfere vdth and stop, as they readily might this local cultivation of the drug, and the prohibition effects little beyond providing a convenient excuse for the underlings attached to the Magistrate's Yam^n to make every attempt to extort as much as they can from those who thus openly violate the law. The gemus of the T'ung-an opium proprietors has, however, proved almost too much for their rapacious enemies. The entire management of the crop from seed- time to its inclosure m hermetically-sealed cyUndersis intrusted to women, who oppose any hostile movement on the part of official underlmgs by such feminine demonstra- tions as invariably result m their being left mistresses of the situation There are few thmgs a Chinaman dreads so much as a row with a woman, against whom public opimon will not permit him to use violence, while no such rule holds good for the women, and those employed in the opium cultivation of T'ung-an do not tail to make considerable use of their advantage. The growth of the poppy therefore 13 continues, but there are at present no signs that this cultivation is at all likely to increase. I have, &c. (Signed) H. A. GILES. P.S.— I inclose Table showing imports, re-exports, and sales of foreign opium. during the year 1879. ^ ^ H. A. G. Inclosure 2 in No. 2. Prohibitory Proclamation issued by the Chinese Authorities against the Cultivation of the Poppy. (Translation.) THIS strictly prohibited Proclamation is issued by the Provincial Administrative Board of Likim, Poochow, and Chang, Brevet Provincial Judge, Chief of the Poochow Likim Central OfiB.ce, Taot'ai for special service, and Bat'uru with the title of Awe- inspiring Brave. There is in the archives a former communication from the Board [of Hevenue at Peking] sending down the following Imperial Decree with reference to a memorial from Pao Ylian-Shen begging that explicit orders might be given for the complete suppression of poppy [cultivation] : — " Cultivation of the poppy is most stringently forbidden by law, but of late this- illicit proceeding has come to be carried on in every province of the Empire on a large scale, to the grievous injury of the people's food-supply.* " The local authorities are apathetic in its suppression, regarding it as justified by long custom, and some, seeking therein benefit for themselves, have even gone so far as to receive bribes for their inaction ; [perpetrating] a connected series of iniquities beyond the limits of description. " Let [therefore] the Governor- Generals and Governors throughout the Empire issue stringent orders to those under their authority for the conscientious suppression [of this cultivation], reporting at once to the Throne such as may be found to continue to trifle with the matter. Let also the Board of Revenue expound the ancient law, and promulgate it throughout the provinces, to the end that the people may know and stand appalled ; and [let them] at the same time give decisive instructions that the local officials render effective the work of suppression ; awarding praise to the energetic, punishment to the lukewarm, and handing over the corrupt for sentence, to each one according to his merits, so that this evU may be rooted out, and the interests of the people be advantaged. " Promulgate these commands for general information." In reverent obedience the Board of Bevenue drew up a set of Bules, which received the Imperial sanction for discriminatingly awarding praise to such local authorities as arrest all illicit poppy growers within their jurisdiction, and punishment to such as fail to take restrictive measures or are deliberately guilty of connivance. The Board also expounded the ancient law, which makes the cultivation of the poppy criminal, and promulgated it in accordance with [the Imperial commands]. The li-Mn ofifices in Pukien levy a tax on the foreign drug ; but when the traffic; in native opium was prohibited, the collection of duty on it was also put a stop to. Medicinal opium, however, as being employed in the Pharmacopoeia, was still taxed as- native opium. Now that the Throne has strictly forbidden the cultivation of the poppy, inasmuch as medicinal opium is very similar to native opium, and both are Chinese produce, they must, of coiu'se, be alike prohibited, and the collection of li-Mn on them be put a stop to. Any one disobeying the prohibition and transporting it for sale must be at once arrested and punished. Orders to this effect have been circulated for the guidance of the officials in this jurisdiction, and, in addition, this strictly prohibitory Proclamation is issued to inform you, merchants and others, that you are to bear in mind that the * t.e., by reducing the area of land under grain cultivation. 14 cultivation of the poppy lias been prohibited, by which prohibition medicinal opium and native opium are also affected. They may not be illicitly manufactured for the sake of gain, or be transported for sale, and if any dare to deliberately disregard these commands, the goods will be confiscated at the li-kin offices and barriers, and [the offenders] will be surely and swiftly arrested, and dealt with according to law without mercy or partiality. Let all tremble and obey. Let none disregard this Proclamation. Issued this day of July, 1879. 15 e5 d .a CO OQ o PI CO g o m iH CO (D d o ID 0) O o o Pm I o o:: 'I W. ! o P^ M I t QQ s 8 jjOOOOOOOMOOOUS "_co-*oo(NoO'*oou:i01>'*00CDOrHCDCq«0 OQ g 1 Dols. c. 595 75, 580'l0 571 70 586 40 (M .-1 00 « OM-* T-l OT i-H r-l ., C3 O Dols. c. 610 00 594' 00 en •s O 00 • . 03 • • (M • . (N • • CO S CD 1 ^0000000000 J2qO.-IO>— iO-*5D-*i-l \ \ \ O03.-Ir-I005t~«0>-I00 00 O WC^O^OlOOOWDCOt^ COi-H«^lOOQOOSi— to • • • 1 1 c!0001MOOOOOOOO «O«)Ol^«3tD-*0000r-l001M ^'ort-^ojocqMOOt-t--* 1 mtOOl-«lTt<«0(MtOO«3-* ■*oooomoomit-05!ousoa5 rH i-H T-( T-H i-H 1 ■1] reiMaj sotDiocqoo •ooo>ou5«s •saaBnag- PIO I^ ..•.••...(Mro'^ • •••••••>COrHT-H -Gn^Bj PIO 0.. •sajBuaa: M0-HM«500i-< •^USOOCOr-lOJOOINIM . . . i-C THr-lrH r-l(MB J Ma^ >-ll^OOO>OU5;OOOiO«S U5(MCO0O-*0Or-lTtx ^ > Ti d (D a 4i 60 -§ OQ ^ 0) s 03 o o ID J3 1 » QQ ID O CO CO I CO (3 a ^ 8 r-t ooctt 16 No. 3. Sir T. Wade to Earl Granville.— (Received August 6.) My Lord, Peking^ June 15, 1881. I HAD hoped to be able several days since to lay before your Lordship a last report of the discussion, now extending over many months, regarding taxation inland of the import trade, and in particular of the taxation of opium. I owe it to my colleagues, Chinese and foreign, to state that, for delay in the preparation of the Eeport in question, no one is responsible but myself. The matter of my despatches is all to hand, but reasons into which I do not propose here to enter have made it difficult for me to complete them. I trust to your Lordship's iudulgence to believe that the will to discharge so plain a duty has not been wanting. ^ I write to-day to redeem, though somewhat tardily, a promise that I would, at an early date, acquaint your Lordship with the propositions brought forward by the Grand Secretaries Li Hung- Chang and Tso Tsung-tang, at a conference held with them last month, to consider the opium question. I do not propose, at the same time, to give here more than a brief summary of what passed. The Grand Secretary Li leaving, came up to Peking to take part in the obsequies of the late Empress Dowager. I was requested to meet his Excellency and his colleague at the Yam^n. His Excellency Tso, ea:flier conferences with whom I have still to report, expatiated, as on former occasions, upon the immorality of the opium trade, the sole means of suppressing which, in his opinion, was by so loading foreign opium with taxation as to make the price prohibitive to all but the wealthy. To this end he would recommend the imposition of a unif or m rate of 150 taels at all the ports, that is to say, 120 taels li-kin over and above the Tariff duty of 30 taels. My reply to this was, in brief, that although the British Government considered the Government of China perfectly free to levy what it pleased of the Chinese purchaser, once the drug had passed into his handg, I did not expect that if its aid in the collection of opium revenue were called for, it would acquiesce in any under- taking that appeared unreasonable, and that although it would be my duty to report any and every proposijtion that might be communicated to me, I should not recom- mend the adoption of any that I thought unreasonable myself, on the reverse, I should urge its rejection. At a subsequent eonference, a,t wMch his Excellency Tso declined to appear, the Grand Secretary Li, after very little fencing, reduced his colleague's total of 150 taels first by 30 taels, and subsequently by 40 taels ; this would add 80 taels to the Tariff duty. I declined either to support this rate of li-kin. Erom the statements previously made at the Yam^n, as I reminded the Ministers, I could demonstrate that an addition of 50 taels li-kin to the 30 taels Tariff, 80 taels in all, would be precisely the amount that they had declared was due to the Treasury according to a general estimate, and of this a large portion must be lost by smuggling, while 10 per cent, had, by their own account, to be allowed as the cost of collection. The contraband trade apart, which would certainly continue if taxation were too high, the whole cost of collection would be saved, if the li-kin, as they desired, were to be collected by the Eoreign Inspectorate. These totals, I should have earlier mentioned, are not of a payment that is merely to clear the opium from the port of entry to the first inland barrier but that is to free it mland, no matter to what distance it may be carried ' We got no further than my promise that all that had passed should be laid before your Lordship. r. •7^.t%^^'°! this and previous interviews are voluminous, and there is much beside that I must trouble your Lordship to peruse. Eor the present I limit mvself to enumeration of the chief questions which Her Majesty's Government will have very presently to consider. *v^ ^<*vc The Grand Secretary Li presses for ratification of the Agreement negotiated with me at Chefoo in September 1876. He is quite aware, as are\lso the Ministers of the Tsung-h Yamen, that the re-adoustment of the taxation of the import trade and the opium question wiU involve the consent of all the Treaty Powers, and, consequently, Sstument °'' ^ ^^ ^^""^ *° ^^ '^^^^^'^^^ ^ ^ supplementary So far as opium is concerned, Her Majesty's Government will have to a^reP ' either to the terms of the Chefoo Agreemeit, which leaves it open to Se oSe 17 Goyemment to direct the Poreign Inspectorate to lay on what li-kin it pleases, as a first instalment ; or to the proposition, now revived (I reported its first discussion at Tien-tsiij in 1879). of a uniform rate at all the ports ; or to the arrangement proposed by the Prince of Kung in January 1880 (China Blue Book No. 2, 1880). The uniform rate, I repeat, now proposed, is to clear opium of all further taxation. I am for some uniform rate, and helieve that exemption from all in excess of it can he fairly guaranteed by a system of certification that has been in vogue in the Canton Province ever since the import of opium was legalized in 1860, and which the Grand Secretary Li and the Ministers of the Tsung-li Yamen, in reply to my questions, affirmed was that which it was in contemplation to adopt. Confusion between the li-kin revenue derived from native opium and the foreign opium li-kin being, at the same time, averted by equalization of the rates imposed on both descriptions. I am persuaded that the Chinese Government will gladly accept 60 taels li-kin, that is, 90 taels in all, as the uniform rate, and I should strongly recommend the Government of India to agree to this ; at all events, for a term of years. Why I make this recommendation shall lie shown elsewhere. I beg that it may be observed, however, that I have distinctly refused here to state to the Tsung-li Yanidn what rate I consider myself free to support. I am thoroughly satisfied, and I believe that I shall be able to prove, on good grounds, that this Government is perfectly persuaded, without any argument of mine, of the futility of attempts to check the use of opium by laws or by excessive taxation. It is facing the abuse of the drug as we face the abuse of spirituous liquors ; not opposing, indeed encouraging, efforts on the side of moderation or total abstinence, but as intent upon securing revenue upon all that is consumed, native or foreign, as . any foreign Government can be, under analogous circumstances, upon any similar object. I shall telegraph when I dispatch the further Beport, of which this must be considered as little more than the argument. I have, &c. (Signed) THOMAS FBANCIS WADE. No. 4* Sir L^ Mallet to Sir J. Pauncefote.^^(Received November 25.) Sir, India Office, November 2^, 1881. WITH reference to recent correspondence, I am directed by the Secretary of State for India in Council to forward herewith, for the information of Earl Granville, a copy of a letter from the Government of India, inclosing memorials from merchants interested in the opium traffic. I have, &c. (Signed) LOUIS MALLET. Inelosure 1 in No. 4. The Governor-General of India in Council to the Marquis of Hartington. My Lord Marquis, Simla, October 15, 1881. WE have the honour to forward, for transmission to the Foreign Office, the accom- panying memorials regarding the tax levied on opium in China from certain merchants of Calcutta and Bombay interested in the opium trade. We submit also a copy of a letter and of its inelosure on the same subject from the Secretary to the Bengal Chamber of Commerce, with copies of the letters addressed to the memorialists and to the Chamber of Commerce. We have, &c. (Signed) RIPON. W STOKES. RIVERS THOMPSON. J. GIBBS. E. BARING. T. F. WILSON. I ll - I , I I II -I - I - I ■ ^-.rrniii 18 Inclosure 2 in No. 4. Messrs. Jardine, Skinner, and Co. to the Secretary to the Government of India. September 16, 1S81. WE have the honour to hand you a Memorial from the merchants of Calcutta interested in the opium trade with China, and to ask you to lay it before his Excellency the Viceroy and Governor-General of India for consideration. Inclosure 3 in No. 4. Memorial. To his Excellency the Most Honourable the Marquis of Ripon, K.G., P.C, G.M.S.I., Viceroy and Governor-General of India. The humble Memorial of the Undersigned Merchants of Calcutta interested in the Opium Trade with China, Sheweth : THAT your memorialists are informed that a Chinese Envoy has arrived in India to confer with your Excellency's Government with the object of arranging for the li-kin and other taxes being made at the custom-houses of the Treaty ports. 2. Your memorialists believe that the merchants of the Colony of Hong Kong and the Treaty ports of China, who have long complained of the taxes imposed by the Chinese authorities beyond the import duty of 30 taels per picul allowed by the Treaty of Tien-tsin, have only been deterred from petitioning that the Government of India should compound with the Emperor of China by paying a lump sum annually to free Indian opium from duty from one end of China to the other by the knowledge that the Government of India would be unable to obtain any satisfactory guarantee ; that after so compounding the drug would not, as soon as it left the said Colony and the Treaty ports, be taxed just as heavily as ever. 3. Your memorialists quite agree with the merchants in China, and submit that any increase in the import duty on Indian opium which the Indian Government may favour will only prove a burden on the article, and put the China-grown produce in a better position to compete with it. The opium market has experienced great fluctuation of late in consequence of the report that a new li-kin tax of 1 50 taels per picul is to be imposed in China, having made Chinese merchants anxious to import prior to the imposition of the new tax, and it is hinted that the visit of the Chinese Envoy to this country has some connection with the above proposed new impost. 4. Your memorialists would respectfully point out that if the Treaty of Tien-tsia, made in 1858, were acted up to, the Imperial Government of China could not levy any further tax than the 30 taels arranged for in the Treaty until the drug was carried into the interior, but about 90 taels more are collected almost under the shadow of the British flag at Hong Kong, and within the boundaries of the Treaty ports, opium having been seized within Treaty ports as soon as out of foreign possession, while Hong Kong is blockaded by Chinese Customs cruizers. This seems much as if England in working the commercial Treaty with France were to exact duty at the tariff rate on French wines, and then prohibit their removal from the ports of arrival until taxes amounting to three or four times the import duty were paid. 5. Your memorialists cannot suggest how the evils complained of at Hong Kong and the Treaty ports are to be remedied, except by the British Government insisting on the terms of the Treaty of Tien-tsin being carried out by the Chinese, but would greatly deplore that any proposal of the Chinese Government for British assistance in levving and realizing fresh taxes should find favour with your Excellency, while the above grievances are unredressed, and the foreign drug is, as at present, subjected to other heavy charges m every province it passes through. ° . ^.\.^^^ Tlf''^^^ ^° ^^^ ^'^^^ °^ *^^ continually changing, but always increasing, impositions of the Chinese authorities, will be clear to your Excellency, but the Indian trade has been well maintained notwithstanding, although the Chinese authorities have pocketed sums which, had the Treaty been better observed, would have heloed to swell the Indian revenue. '^ 7. Your memoriaUsts know that their brother merchants of Bombay are also petitiomng your Excellency, and would, with them, pray that the system of taxation on 19 Indian opium in China, as authorized by the -Treaty of Tien-tsin, be not departed from, as any departure in the direction indicated will be calculated to sacrifice Indian revenue, and to do an injury to the Indian opium trade. And your memorialists, as in duty bound, will ever pray. (Signed) JARDINE, SKINNER, and Co. (And 36 others.) Inclosure 4 in No. 4. Mr. Jacob to Messrs. Jar dine, Skinner, and Co, October 15, 1881. I AM directed to acknowledge the receipt of your letter, dated the 16th September, 1881, inclosing a Memorial, dated the 13th idem, to the address of his Excellency the Governor-General, from certain merchants of Calcutta interested in the opium trade with China. The Memorial has been forwarded to Her Majesty's Secretary of State for India. 2. With reference to the statement that the visit to India of a " Chinese Envoy " was made with a view to arrange for the new li-kin duties, I am to explain that Mah Kie Tchong, the Chinese official who came cut to India recently, is not an Envoy ; that he came to obtain information on the opium question ; and that his visit was not connected with the subject to which the memorialists allude. Inclosure 5 in No. 4. Memorial of Bombay Merchants. To his Excellency the Most Honourable the Marquis of Ripon, K.G., P.C, G.M.S.I., Viceroy and Governor-General of India. The humble Memorial of the Undersigned Merchants of Bombay interested in the Opium Trade with China, Sheweth : THAT your memorialists respectfully beg to bring the following facts to the notice of your Excellency in Council, with the hope that the prayer of their petition may be taken into consideration. L Your memorialists beg to point out that the opium market has lately undergone great and sudden fluctuations, owing to the report that the Chinese Government contem- plate considerably raising the import duty on Indian opium with the consent of the British Government. Your memorialists respectfully submit that any such increase will affect the con- sumption of Indian opium, and will, at the same time, give an impetus to China-grown opium, which is now being largely cultivated, and already enters into competition with the Indian drug. The total annual yield of the various Chinese provinces is computed to be more than the whole of the annual opium exports from India. The disadvantages under which Indian opium already labours from being burdened with double the taxes levied on opium grown in China will be further increased by the fresh taxation proposed by the Chinese Government, Such taxation, if carried into effect, will make the Indian opium revenue a very precarious one, and will cause a serious loss to the merchants engaged in the trade, besides throwing great masses of people out of employment who are now engaged in India in the cultivation and manipulation of this article of commerce. 2. Your memorialists beg most respectfully to call your Excellency's attention to the fact that, by the Treaty of Tien-tsin made in 1858, the importation of opium into China was legaHzed on the conditions that the Chinese Government should be allowed to levy an import duty of 30 taels (about 100 rupees) per picul (133|^ lbs.), that such duty should be collected at the custom-houses under the superintendence of foreigners, and that as soon as the opium left the hands of the foreigners, and was taken to the interior, they might tax the drug to whatever extent they pleased. This duty of 30 taels, after payment of expenses of collection, is remitted entirely to the Imperial Government. The li-kin tax is levied on all goods passing the inland barriers (which have already paid the import duty as provided by the existing Treaty), and thr revenue derived therefrom in 20 the hands of the Governors of the different provinces who, after paying the expenses of administration' and of the soldiers under their charge, appropriate a large portion to their own use, and remit the balance to the Imperial Treasury. This systeto of coWection has worked favourably as far as Indian opium is concerned, notwithstandmg that the Chinese have the power to levy as heavy a tax as they wish, once the opium has left foreign Hands, because competition is so great among the Mandarins that if the tax is higher m one province than in another, opium is taken to the consuming districts by the route where the tax is the lowest, the facilities offered by canal commumcatiou allowing this to be easily done. , , ^ , -^ j i ■ iu 3. Your memorialists beg further to point out that the Treaty above referred to is the only one now in force between the Chinese and British Governments ; but the Chinese, findino- that they could not place confidence in their own officials to render them a true account of the li-ldn tax collections, asked Sir Thomas Wade in 1877 (when he was at ChefoO arranging certain grievances then complained of) to allow them to collect the li-kin tax through the custom-house. Sir Thomas Wade promised to refer the majiter to his Government. He was given to understand that if the proposal was carried out, h-kin tax collections in the interior would be done away with ; but this is practically impossible, as the Mandarins and their subordinates, receiving very small pay from Government, earn their livehhood principally by illegal taxation, and they would never pass the goods without collecting further taxes. It is impossible to prfevent them from doing so, as the native dealers could not refuse to pay such taxes, and it would be most difficult to get them afterwards to give evidence about the matter for fear of being severely punished. Your memorialists have therefore humbly to point out that even should the li-kin tax be allowed to be collected at the custom-houses of the Treaty ports, another tax would, without question, be charged in the interior, and a much heavier burden thereby placed on Indian opium than at present. 4. Your memorialists, seeing the great injury that would have been done to the Indian opium trade if this proposal had been carried into effect, petitioned the Secretary of State at that time ou the subject, and succeeded in inducing the Government to stop the ratification of the Chefoo Convention. But your memorialists, hearing that the subject is again being agitated, and that a Chinese Envoy has arrived in India to confer with your Excellency's Government on the matter, deem it their duty to bring these facts to the notice of your Excellency, and should further information be required will gladly furnish it. 5. Your memorialists, in conclusion, earnestly hope that your Excellency will not sanction any proposfeil that would inflict such great injury on Indian opium without first conferring with those who are so largely interested in the trade. By the Chefoo Conven- tion no concession or benefit is given to the British Government sufficient to warrant such an enormous sacrifice of the Indian revenue as would most assuredly take place if the proposal of the Chinese Government found favour with your Excellency. It is true that a few more ports for the foreign trade have been opened, but the benefit derived from this concession is much greater to China than to Great Britain. Your memorialists therefore pray that the system of taxation on Indian opium in China may be allowed to remain as at present authorized by the Treaty of Tien-tsin, as any deviation therefrom will cause great loss and injury to the Indian opium trade. And your memoriahsts as in duty bound will ever pray. (Signed) DAVID SASSOON and Co. (And others.) Bombay, September 1, 1881. Inclosure 6 in No. 4. Mr. Jacob to Messrs. David Sassoon and Co. r AA/r J- . J . , , ^ , . October 15, 1881. I AM directed to acknowledge the receipt of the Memorial, dated 7th September last, which you and certain other merchants of Bombay interested in the opium trade have addressed to his Excellency the Governor-General regarding the opium tax in China and to inform you that the Memorial has been forwarded to the Right Honourable the Secretary of State for India for transmission to Her Majesty's Foreign Office 2. With reference to paragraph 4 of the Memorial, I am directed to inclose the accompanying extract from a letter which has been addressed this day to Messrs Jardine Skinner, and Co., of Calcutta. ' ' 21 Inclosure 7 in ^o. 4. Mr. Wood to the Secretary to the Government of India. September 22, 1881. THE Committee of the Chamber of Commerce have recently received from Messrs. Herton and Co., merchants and agents, established at the Treaty port of Pakhoi in China, a representation relative to the action of the Chinese officials in endeavouring to levy on Indian opium various taxes in excess of the import duty of 30 taels per picul, as per Customs Tariff authorized by the Treaty of Tien-tsin of 1858. A printed copy of that representation is herewith submitted for your information, and in placing it before you the Committee instruct me to express their hope that measures will be taken by Her Majesty's Government, both at home and in this country, to maintain the provisions of the Treaty in their integrity. The position taken up by the Chinese authorities appears to be of sufficient gravity to demand the intervention of the British Government, in order to protect a trade which yields so large a proportion of the Indian revenue, and the security of which may be seriously imperilled if the proceedings of the Chinese authorities in evasion of the Treaty obligations are not promptly and firmly arrested. This subject, which the Chamber of Commerce now venture to submit for the con- sideration of the Government of India, has not been overlooked by the merchants of Calcutta and Bombay, who have memoriahsed his Excellency the Viceroy and Governor- General in Council, praying that the system of taxation on Indian opium in China as authorized by the Treaty of Tien-tsin be not departed from, as any departure from it in the direction indicated in the memorials will be calculated to injuriously affect the opium trade, and to sacrifice the revenue derived from it. Inclosure 8 in No. 4. New Taxes on Opium. Messrs. Herton and Co. to the Chairman of the Chamber of Commerce, Calcutta. July 31, 1881. AS we find the Chinese authorities, under one pretext and another, are establishing more and more offices for the collection of new taxes on Indian opium in the Treaty ports of Pakhoi and Hoihow, in the Province of Kwang Tung, to the great detriment of trade in this article, and as one of these new ofiices, called the haifang (defence tax), has lately interfered with our legitimate business as regards opium, by molesting our customers, and even forcibly seizing our own opium from our own people, we have complained to Her Majesty's Consuls both at Pakhoi and Hoihow, who have referred the whole question to Her Majesty's Minister at Peking. Considering this question to be one which not only affects ourselves, but which may also have a good deal of influence on trade in Indian opium generallj^, and as such may interest your Chamber, we avail ourselves of this opportunity to state, as briefly as possible, what has transpired. We take our standpoint on the following ground, viz. : — Clause 1, Kule 6, Section 3, Articles of Trade with China, Tien-tsin Treaty, 1858, says — " Opium will henceforth pay 30 taels per picul import duty. The importer will' sell it only at the port. It will be carried into the interior by Chinese only, and only as Chinese property." It has been urged by the Chinese authorities that it was contemplated by the framers of the Chefoo Convention that a change should be made, and that the li-kin (war tax) should be paid by the purchaser. It is, however, this very clause which has not been agreed to by Her Majesty's Government, and as the Chefoo Convention is not ratified, it cannot be brought forward either in support of or against the action of the Cliinese authorities. The clause of the Tien-tsin Treaty above referred to is all we have to go by at present, and we submit that, in accordance with that clause, no tax whatever beyond the import Tariff" duty of 30 taels per picul (say, 116 rupees per chest, about) can legally be levied within the limits of the Treaty ports on foreign opium imported by a foreign vessel from a foreign country. As foreian merchants, our limit in which to transact businesR in nninm tlmt ic tn 22 buy or sell the article, is clearly defined, as being restricted to the Treaty ports. The clause permitting us to sell in the open port must reasonably permit purchasers to buy from us without molestation. If this is not the case, the portion of the clause permittmg us to sell appears to us to be nugatory, , z-ii • tu •,.• As matters now stand, however, although we have no doubt the Chinese authorities are well aware that they have no legal right to levy arbitrary duties within the hraits of the Treaty ports either on Indian opium or on any other foreign goods within the hmits of the Treaty ports, yet with their well known propensity for trying how far they can go with impunity, they have commenced first by establishing the li-kin (war tax) office m the ports, and imposing a tax of 23 taels per picul (say, 90 rupees per chest). At the close of 1879 the haifang office was opened, and 22 taels (say, 69 rupees) per chest demanded ; this was opposed by native merchants, who appealed to foreign merchants for assistance, and so far as British merchants at this port were concerned. Her Majesty's Consul, in reply to a communication from the Prefect, clearly expressed his views that in accordance with the Treatv no other tax beyond the 30 taels per picul could be levied in the port on Indian opium imported by foreign vessels from a foreign country. This principle was admitted by the Prefect, and for some time the business of British merchants was not interfered with directly, but the office was not removed. Jn January last the officials, finding that they had gone along so far without being obliged to close their establishments in the ports, imposed another tax called kanli (a tax on prepared opium) 30-2-0-0 taels (say, about 94 rupees) per chest. The actual collection of this tax commenced about May last, and for their own convenience they made it payable on raw opium, in the same way as the other imposition. They now contemplate levying an additional tax of 150 taels (say, 506 rupees) per chest, also to be collected in the open port, so that duties will then total in round figures as follows : — Rs. Import Tariff duty per chest .. .. .. .. •• ..115 Li-kin tax .. .. .. .. .• •. .• ..90 Haifang .. .. «• .. s. •• *• •• .. 69 Kanli tax .. .. .. .. .. .• .. ..94 New tax proposed. . ., .. .. .. .. .. .. 506 Say, total per chest . . . . . . 874 of which we contend that only the equivalent of 11 5 rupees per chest is legally leviable in the port. The Chinese authorities are evidently of opinion that the time has now come for them to make a bold effiDrt to over-ride altogether the Article of the Tien-tsin Treaty above referred to, and no doubt with this object the haifang office has lately placed soldiers around our premises, seized our customers just outside our door, and crowned their actions by seizing and maltreating one of our own men close to our house, and forcibly taking from him our own opium which he was carrying along. We had paid the legal Tariff duty on this opium, and it had not changed hands. The same things have been done at Hoihow. Both at Pakhoi and Hoihow Her Majesty's Consul demanded the immediate restitu- tion of our property, but the haifang office persistently refused to give it up. That office (the haifang), we may here explain, is carried on by a company of Chinese merchants, principally from Hong Kong, who hold no official position, and to whom the Viceroy of Canton has farmed the privilege of collecting the haifang and kanli taxes for the sum of 90,000 taels (say, 3,03,750 rupees) per month, their area being the Province of Kwang Tung. The Prefect of this port, although, in reply to the representation of Her Majesty's Consul, he again admitted the principle for which we contend, dared not compel the restitution of the opium, as the haifang office immediately appealed to the Viceroy of Canton, to whom the Prefect is responsible for his action. The Viceroy, in reply to Her Majesty's Consul, said that he would cause inquiries to be made as to whether the opium seized bad passed out of foreign possession or not, but we are in posses- sion of proofs that at the same time he privately instructed the Prefect not to return the opium. The Viceroy further stated to Her Majesty's Consul that while opium in foreign possession could not be taxed beyond the Tariff duty, yet the moment it passed into Chinese hands, no matter whether in the Treaty port or not, it could be taxed in any way the Chinese authorities might please. A copy of a document has come into our possession, which clearly shows that the 23 Ts'ung Li Yam^n (Board of Foreign Affairs) at Peking will,' if possible, sui)pori the Viceroy. If the principle which the Viceroy contends for be admitted, then the right granted to importers, under the Treaty of Tien-tsin, to the whole area of the Treaty ports, in which to transact business, is at once done away with, and each individual merchant wilt be limited to his own individual premises, because the moment opium passes his door it will be seized. And should the Chinese officials succeed in tbeir present attempts, legiti- mate business in Indian opium at the Treaty ports will no longer be possible either for foreign or native merchants. Smuggling will no doubt be carried on to some extent, but Indian produce in this direction must eventually give way to the native article tVon» Yiinnan. Lately there has been a greater demand for Indian opium in China, but this^ is. explained by the fact that native merchants are anxious to import prior to the imposition, of the new tax. The well-meaning people connected with the Anti-Opium League may perhaps be of opinion that the imposition of these almost prohibitive duties shows the desire of the Chinese Government to put a stop to the traffic. This, however, is certainly not the case. Prior to the signing of the Treaty of Tien-tsin, the whole system of taxation (barring salt and land) was on transit, and arbitrar)', being collected by insufficiently paid official? in the provinces, who were dependent on what they could decently stop out of their receipts, and who besides had a lively notion of the taxableness of foreigners. The revenue had to filter through their hands, and somehow before reaching Peking had enabled the officials (salaried at ridiculous rates, which would not pay one of the several Secretaries- necessary in their Yamen) to acquire wealth. The framers of the Treaty of Tien-tsin were well aware of this, and it was precisely this system which they intended to alter. By the provisions of that Treaty duties were thenceforward to be collected according to the prescribed Tariff, and the result, without deduction, was to be sent to Peking. The Peking Government, though now in receipt of a large and certain revenue (whicb is collected and remitted through the foreign Inspectorate of Customs), instead of the quota which formerly reached it, has made no change in the salaries of its provincial officers, who have still to keep up the same establishments, make the same presents, and remit the same quota of revenue to the Peking Government as before, and still manage to retire wealthy after their term of office has expired. To enable them to do this, it is very plain that new sources of revenue must be found, and Indian opium is one of the articles fixed on as convenient to tax. n:iore especially if it can be done in the Treaty ports. When a new tax is instituted, the right of collecting it is farmed to whoever will give the highest price. The farmers, who go into the business purely on speculation, come along armed with a proclamation from the Viceroy, and proceed straight.way to make a& much money as they can. They have no regard for the Treaty, or for the morality or immorality of the trade, or for anything else but their own pockets ; and it is t^carcely necessary to point out what must be the result under such a system. Matters will, in fact, soon becone worse than they were before the Treaty of Tien-tsin was signed. We contend that the meaning of the Treaty of Tien-tsin is very clear, viz., that all goods of foreign origin, opium included, from a foreign port by a foreign vessel, shall he imported into and sold in the Treaty ports of China, on payment of Tariff duty only. And it is only when such goods leave the port for the interior that they become subject to other regulations. The transit regulations are intended to provide for the introduction of piece-goods, cotton, yarn, &c., into the interior (though the transit pass for such goods in- the Provinces of Kwang Tung and Kwangsi is at present practically useless, in conse- quence of the officials persisting in imposing differential duties on certificated goods, and doing their utmost to throttle any attempt to convey the same to or from the interior. This affects Indian trade very materially, because if foreign goods could be conveyed into the interior on payment of half the import Tariff duty, as provided for by the Tien-tsin Treaty, the consumption of Indian cotton, yarns, &c., would increase enormously), As concerns opium, foreigners have by Treaty given up all control of the article as soon as it leaves the port, but not before, and this fact, combined with the circumstances that it was necessary to make a special clause in the Chefoo Convention when it was contemplated that the purchaser of opium should pay li^hin, shows that under the Treaty of Tien-tsin he (the purchaser) is not obliged to pay li-kin ov any other tax beyond the import Tariff duty in the Treaty port. in conclusion, we are glad to say that we have met with warm support from Mr. Consul Ford, of Pakhoi^ and Mr. Consul Johnson, of Hoihow, and we hope that Her ri2381 ^ 17. 24 Majesty's Minister at Peking may decide the question at issue in a manner fevourable to foreign trade. The reluctance with which Chinese officials in this direction carry out any of their Treaty obligations, and their evident desire to utterly ignore the Treaty on all possible occasions, in which it is but too much to be feared that they are supported, either dirdbtly or indirectly, by the centi'al Government at Peking, tends to show that any concession made to them at present would be most disastrous not only to trade in Indian opium, but to the advancement of business generally at the Treaty ports. In representing this matter to your influential body, we shall be glad (should our views meet with your approval) if you will support us. If necessary, we shall have pleasure in furnishing you with further particulars. Inclosure 9 in No. 4. Mr. Jacob to the Secretary to the Bengal Chamber of Commerce, Calcutta. October 15, 1881. I AM directed by his Excellency the Governor-General in Council to acknowledge the receipt of your letter, dated 22nd September last, submitting, with an expression of the views of the Committee of the Chamber of Commerce, a representation from Messrs. Herton and Co., of China, regarding the taxes levied on opium by the Chinese Government, and to inform you that a copy of the letter and its inclosure have been forwarded to the Right Hon. the Secretary of State for India for transmission to Her Majesty's Foreign OflSce. No. 5. Sir L. Mallet to Sir J. Pauncefote. — (Received June 2.) Sir, India Ofice, May 31, 1882. l^N" continuation of my letter dated the 24th November, 1881, I am directed by the Secretary of State for India in Council to forward herewith a copy of a letter from the Government of India, and of its inclosure, being a letter from the Hong Kong Chamber of Commerce, in which they request "to be allowed to express their views before any arrangement is arrived at on the Opium question. I have, &c. (Signed) LOUIS MALLET. Inclosure 1 in No. 5. The Governor-General of India in Council to the Marquis of Hartington. My ^o^^' . Simla, April 24, 1882. IN contmuation of our despatch dated the 15th October, 1881, we have the honour to forward the accompanying copy of a letter from the Chairman, Hong Kong General Chamber of Commerce, requestmg that the Chamber may be allowed to express its views upon any arrangement which may be in contemplation in connection with the opium trade with China. We have, &c. (Signed) RIPON. D. M. STEWART. J. GIBBS. T. F. WILSON. T. C. HOPE. inclosure 2 in No. 5. The Chairm^anof the Hong Kong General Chamber of Commerce to the Secretary to the Government of India. T A ivT ^ • J u .1 ^ . March 16, 1882. 1 AM desired by the Committee of this Chamber to address you on the subject of the opium trade between your port and this Colony and China. 25 It has been stated by the press, and the Chamber has information from other sources, that negotiations are pending between Her Majesty's Grovernment and the Government of China for the regulation of the trade in opium between India and the latter country. If this should prove to be the case, and the proposed arrangements in any way affect this port, or interfere with the freedom of trade which since its settlement it has enjoyed, I am to ask you to be good enough to lay before his. Excellency the Viceroy the respectful request of this Chamber that it be allowed to express its views upon any arrangements which may be in contemplation. Inclosure 3 in No. 5. The Officiating Under-Secretary to the Government of India to the Chairman of the ■ Hong Kong General Chamber of Commerce. April 24, 1882. I AM directed to acknowledge the receipt of your letter, dated 16th March, 1882, regarding the opium trade with China, and to say that it has been forwarded to Her Majesty's Secretary of State for India for transmission to Her Majesty's Foreign Office. No. 6. Sir T. Wade to Earl Granville. — {Received June 6.) (Telegraphic.) Peking, June 5, 1882. MT Report on opium and other papers were sent on the 3rd and 4th instant. I shall forward this week full record of Conferences on this subject. .■N"o. 7. Acting Consul Spence to Earl Granville. — {Received June 14.) My Lord, Ichang, April 15, 1882. I HAVE the honour to inclose my Report on the trade of this port for the year 1881. In a previous despatch I informed your Lordship that I had taken the opportunity of my recent journey to Chungking to make inquiries regarding the cultivation of native opium in the Province of Szechuan. The result of these is embodied in this Report, and to that section of it I take the hberty of requesting your Lordship's attention. On the extent and conditions of opium culture in Western China, on the attitude of the Chinese Government thereto, and on the effect of opium-smoking on the people of the provinces where the habit is all but universal, my Report will be found, I think, to throw considerable light. I have transmitted a copy of it direct to Calcutta, for the information of Her Majesty's Indian Government. The small sum of 12 dollars, expended by me in procuring information, I have paid from my fixed quarterly allowance in the March quarter. I have, &c. (Signed)- WM. DONALD SPENCE. Inclosure in No. 7. - Report. THE statistics of the trade of Ichang during 1881, that is, of the trade passing through the Maritime Customs, are given in the following Tables appended to this Report : — 1. Direct Trade with British Empire and Foreign Countries. 2. Indirect Trade (Coast and River). 3. Shipping. 4. Foreign goods imported. 5. Native Produce imported. 6. Native Produce exported. I19.S«1 „ _ 26 The great increase in the trade of 1880 over previous vears has not been maintained. The total valae for last year is only 1,523,005 taels, as against 2,094,898 taels m 1880. This decline is due to one cause only, to be presently explained, and is common to all branches of trade, as will be seen at a glance from this Table : — Imports of foreign goods Imports of native produce Exports . . . . Transit trade 1881. Taels. 885,482 149,728 487,795 1,237,808 1880. Taels. 1,010,756 225,089 859,053 1,679,183 The revenue of the port has fallen in like proportion, being but 45,687 taels, against 68,627 taels in 1880. In my Report for 1880 I pointed out that the trade of Icliang is simply a carrying trade in imports destined for, and exports from, the Province of Szechuan, that it is of great extent, and that its transfer from junks to steamers would not be accomplished until steam communication was maintained regularly throughout the year between Hankow and ihis port. The large increase in the trade of 1 880 was caused by the running of a small •steamer several trips during the winter of 1879-80, and the decrease in the trade of last year is the result of the withdrawal of the steamer during the winter of 18S0-81. At the risk of repetition, I must'add that, so long as steam communication is maintained between Ichang and Hankow only during the summer months, the trade of the port will never increase. With regular steamers, trade would increase with great rapidity. Shipping. The China Merchants' Steam l^avigation Company is the only shipping line represented here at present. A small steamer of about 450 tons arrived here on the 26th April, and continued to make two or three trips a month up to the end of September, when she was replaced for a time by a larger boat. In the end of October regular communication ceased. The great shipping trade between Szechuan and the east is at its height in winter and spring, when the water is low and the rapids easy to contend with. During the summer and autumn freshets it ceases altogether, commencing again when the river begins to fall. Consequently, it will be seen that the running of a steamer between Hankow and Ichang in summer only cannot be profitable. On the Upper Yang-tsze trade is almost at a standstill for three months, and it is not brisk for four more. These are the months in which the steamer plies to Ichang, while during five months of bustle and Activity on the river it is withdrawn. The Chinese Company are aware of the folly of existing arrangements, and during the past twelve months they showed some anxiety to amend them. Failing to purchase a suitable steamer in Japan, they cut down their regular boat at considerable expense, and lessened her draught a few inches. Thus altered, she ran two trips last winter, without cargo, as an experiment, but she did not prove suitable to the conditions of the river at that season, and was withdrawn. The winter of 1881-82 sees Ichang cut off again, during the height of the junk traffic, from the lower river ports. What is required is a steamer that will carry 500 tons of cargo on a draught of 4 feet at a speed of 1 1 knots. Such a vessels running summer and winter would find most remunerative employment. I have put myself in communication with more than one of our leading British shipping firms on this subject, but, so far, my facts and figures have failed to induce them to get the requisite steamer, and to extend then operations to Ichang. An excellent shipping trade is going a-begging. During the year there has been some talk in foreign shipping circles in China of steam navigation to Chungking. To this subject I have alluded in another part of my Report ; but I may here state my opinion that the first step to that end is regular steam traffic between Ichang and Hankow. Until that is uninterrupted, the commercial success of a line to ' Chungking, begging for a moment the question of its practicability, would be impossible, and the enterprise Quixotic. The only other important facts I have to notice in connection with shipping are that 4 taels per ton has been proved to be a prohibitive rate of freight during summer ; and that last winter, in the absence of steamers, a considerable quantity of cargo was exported in chartered junks. Imports, The import of cotton piece-goods has fallen off from 260,000 pieces in 1880 to 228,000 pieces in 1881. A decUne in the consumption of -piece-goods in Szechuan must 27 not be argued from this, the cause being, as I have shown, purely local. The only variety of cotton fabrics which shows an increase is that of English sheetings, and although the increase is relatively large, and accompanied by a decrease in American sheetings, the figures are too small to form a basis for safe conclusions. Woollen goods, on the con- trary, have increased from 24,000 to 27,000 pieces.. The more valuable makes, such as Russian cloth, show a falling-oflf. A small quantity of foreign opium has been imported, 2 piculs 40 c, so small as to be no exception to the' rule that in the provinces of China, where opium- smoking is most prevalent, Indian opium is known only &s a delicious but unattainable luxury. The important subject of native opium will be treated more appropriately under the heading of exports. Kerosine oil is largely imported both for local consumption and for transhipment to Szechuan, but as it is not carried by steamer it does not appear in the import list. Its sale inside large cities like Chungking is forbidden. The prohibition does not affect the trade in it, much of the business portion of Chinese cities being outside the city walls. Imports of native produce call for no special notice. Exports. The cause which has produced a decline in imports has equally affected exports. Yellow silk, the most important Szechuan product exported by way of Ichang, has declined a-half. The capabilities of the province for the production of silk are very great; except, however, at very low prices, it is unsaleable in Europe, so dirty and uneven is it. Mi^jt Baber estimates the total production at about 42,000 piculs annually. Of this 14,000 piculs come from the districts of Chiating Fu, 17,800 piculs from Hsi Chung, the balance from other parts. The value of this out-turn is about 7,000,000 taels, and one- third of it is exported to the north and east. The export and consumption of Szechuan white wax are falling off, but not, as yet, in proportion to the falling-off in production. The cause is the yearly increasing use all over China of kerosine oil for lighting purposes. Tea, as yet, finds no place amongst Ichang exports, the growers in Szechuan confining their attention to local and Thibetan markets. Green tea is produced close to Ichang ; but the inexperienced cultivators do not know how to make " hung," or " black " tea. About 10,000 piculs are annually produced near the village of Lo Tienchi in this district. The plants are picked once a-year only ; the leaves are dried over stoves so quickly that tea picked in the morning can be used at night. The total volume of the exports of Szechuan produce to the east cannot be much less than 40,000,000 taels per annum. Of this, 25,000,000 taels is represented by salt and opium; but a goodly part of the remainder will be shipped from Ichang when adequate shipping facilities are available at all seasons. Of all the products of Szechuan, the most important now-a-days is — Native Opium. In September last year it was my fortune to be sent on the public service to the commercial metropolis of Szechuan, Chungking. I was four months in the province. In the course of that time I visited parts of the great opium country, questioned many people regarding opium culture, consumption, and export, and carefully noted the observations and conclusions on these subjects come to by Mr. Colborne Baber and Mr. E. H. Parker during their official residence there, with a view to giving, as far as possible, exact information in my Trade Report on a matter of great commercial, and- no little political, interest at the present moment. 1. Where cultivated. — The cultivation of the poppy is carried on in every district of Szechuan except those on the west frontier, but most of all in the Prefectures of Chung- king Fu and Kweichow Fu. In all the districts of Chunking Fu, south of the Yang-tsze, and in some of the districts of Kweichow Fu, north of that river, it is the principal crop, and, in parts, the only winter crop for scores upon scores of square miles. The liead- quarters of the trade are at the city of Fuchow, in ' the first of these Prefectures, and, in a considerably less degree, at Fenglu, a district city in Kweichow Fu. Baron Richthofen writing in 1872, says that the poppy then was cultivated only on hill slopes of an inferior soil, but one sees it now on land of all kinds, both hill and valley. Baron Riclithofen himself anticipates this change when he sa3's : — "The Government may at sometime or other reduce the very heavy restrictions, and if Szechuan opiut^ then should be able to command its present price at Hankow, the consequence would be an immediate increase in the area planted with the poppy." Since he wrote, the area given to the poppy has much increased, though not from the cause alleged. Being a winter crop, it does not interfere with rice, the food staple of the people, displacing only subsidiary crops, such as wheat, beans, and the like. When it is planted in paddy and bottom lands, which now-a- days is often the case, it is gathered in time to allow rice or some other crop to follow. 28 It can hardly be said of Szeclman that the cultivation of opmm seriously interferes with food supplies. The supply of rice remains the same, and the opium produced, less the value of the crops it replaces, is so much additional wealth to the province. 2. Tmvre of Opium Lands. -Opmm lands, like other lands in Szechuan. are either owned by the cultivator or held in metayer tenure by tenant-farmers— the tarraer paying a proportion of the summer crop as rent. This ktter is by far the most common form m the neighbourhood of towns, the wealthy inhabitants of which invest their money in land-. Large estates are not uncommon, and inuch land is held by Buddhist tempks, corpora^ tions, and gentry as trustees to charitable family (« gens ") or public uses. The incidents attaching to metayer tenure in Szechuan are, in brief, these:— At the commencement of the lease the tenant deposits with the landlord a sum of money as security tor the rentj which, when the tenancy determines, is returned to him. Leases may or may not be m writing ; in general tliey specify no time, and are understood to run from year to year. Their practical effect is to give, as in England, a permanent lease to the tenant. The Government land tax is paid by the owner or his assigns, and is never paid by the tenant. The tenant's existence, for purposes of taxation, is not recognized by the Government. Rent being paid on the summer crop only, the winter crop is the tenant's great source of profit;, and it is this fact which makes the question of tenure important in connection with opium cultivation. As I shall presently show, opium is a more remunerative crop than its only possible substitutes, beans or wheat, and no percentage of the opium crop being due to the landlord, its cultivation has been greatly stimulated in consequence. Of late years, however, in the districts I. have named as being in winter one vast poppy field, owners of land have become alive to the value to occupiers of the opium crop, and have stipulated for a share of it in addition to their share of the summer crop. Rents, in fact, where opium is in universal cultivation, have practically doubled. Before leaving the subject of tenure, I may add that, in the event of non-payment of rent from causes other than deficient harvests, the landlord helps himself to the deposit in his hands. In bad years remissions are willingly made by the Government to owners of the land- tax, and by owners to occupiers of the rent-produce. 3. Wheat and Opium Crops compared. — ^The question of the pecuniary advantage df opium over wheat receives a short and sorriewhat erroneous notice from Baron Eichthofen. He assumes that 30 oz. is a good crop of opinni from a " mow " of land — that is, 200 oz. per acre. In this he is far under the mark. Mr. Baber, after, one may say, years of observation, takes it to be more than double that amount. However, when Richthofen wrote, opium was apparently cultivated on poor land only, getting little attention and no manure, but now-a-days it is grown , on good land, carefully manured, and, under such conditions, it produces, as far as I could ascertain, an average amount only a little less than Mr. Baber's estimate. It must be remembered, too, that every single part of the poppy plant has a market value. The capsules, after the juice has been extracted, are sold to druggists, and made into medicine ; oil is expressed from the seeds, and largely used for lighting and adulterating edible oils ; the oil -cake left in the oil-press is good manure, as are also the leaves ; and the stalks are burnt for potash. Against these advantages opium is subject to a rent, and requires, for profitable cultivation, plenty of manure ; whereas wheat, where followed by a summer crop, pays little or no rent, and gets, in general, no manure. Into the relative profits of opium and wheat both Mr. Baber and Mr. Parker have gone very carefully, and their results correspond, in the main, with my own observe* tions. The following are Mr. Baber's figures :* — A piece of land, 100 feet square, will give 90 oz. of opium or 330 catties of wheat, the former worth 8-6 taels, and the latter worth 4-2 taels. Calculated in English money and acres, 1 acre will give 403 oz. of opium or 1,600 lbs. of wheat, the opium being worth 153s, and the wheat only 75s. The out-turn of opium may be here slightly over-estimated, but the very best case is stated for wheat, as Mr. Baber allows 26^ bushels to the acre, and 23s, a quarter for its market price, both excessive estimates, in my opinion. To 153s„ the value of the opium, is to be added 20s. an acre for oil, capsules, and other poppy products, but this may fairly be set against the expenses of manure and extra labour opium cultivation requires. So that the advantage of opium over wheat, though not so overwhelming as I estimated it to be in ray Report last year, is still very great, leaving abundant margin for the payment of rent. My own figures give an average of 350 oz.-of opium per acre, but as I put the yield of wheat and its market pnce at a much lower rate than Mr. Baber, I obtain the same ratio in the value of the two * 1 acre =6-66 Chinese mow. l,-550 cash = 1 tael = 5s. Gd. 10 mace = 1 ounce = l^ ounce avoirdupois. 16 ounces = 1 catty = 1| lb. avoirdupois. 100 catties =« 1 picul = 133 lbs. 29 crops. Opium, then, is twice as valuable a crop to the farmer, where he is owner, as wheat ; and, where he is occupier, the advantage will depend on his rent. In districts remote from market towns, or hill country, the advantage of opium over wheat is much greater, because the cost of carrying wheat to a market is higher than that of opium. 4. Poppy CuUivation.-^The poppy is now grown on all kinds of land, hill slopes, terraced fields, paddy and bottom lands in the valleys. Since 1872, when Baron Richthofen visited the province, a great change has taken place in this respedt, for it appears to have been cultivated then on hill lands only. All the country people whom I asked were agreed that opium is most profitably grown on good land with liberal manuring. In India it is best grown on rich soil near villages where maaure can be easily obtained, and the Szechuan cultivator has found this out for himself. Poppy cultivation, as prac- tised in Szechuan, is very simple. As soon as the summer crop is reaped the land is ploughed and cleaned, roots and weeds are heaped and burnt, and the ashes scattered over the ground ; dressings of night soil are liberally given. The seeds are sown in December, in drills I-| feet apart. In January, when the plants are a few inches high, the rows are thinned and earthed up so as to leave a free passage between each ; the plants are then left to take care of themselves, the earth round them being occasionally stirred up and kept clear of weeds. In March or April, according to situation, the poppy blooms. In the low grounds the white poppy is by far the most common, but red and purple are also grown. As the capsules form and fill, dressings of liquid manure are given. In April and May the capsules are slit and the juice extracted. The raw juice evaporates into the crude opium of commerce, increasing in value as it decreases in weight. 5. Taxation and Government Interference. — Government interference with the cultiva- tion ceased some fifteen years ago, and long before that time it had been ineffective and fitful. When the present Governor-General Ting Kung-pao assumed office in 1878 he' issued one of the most extraordinary Proclamations on the subject that have ever appeared in China. Beginning by daiouncing the poppy growth, and by ordering the destruction of the growing crop, -it went on to say that native opium did not bear its fair share of local burdens, and that in future a li-km of 3 per cent, ad valorem, amounting to 4"8 taels for 1,000 oz., would have to be paid, instead of 3 taels as before. Mr. Baber very justly remarks of this Proclamation that it was not seriously intended to put down cultivation, it was seriously intended to raise the U-kin. The gentry of the province sent a deputation to his Excellency, shortly after the appearance of the document, to find whether anything was meant by it, and, if necessary, to warn the Governor- General of the danger of disturbing an industry so beneficial to the province. No remonstrances on their part were required, for they were assured that the Proclamations were in all cases accompanied by private instructions to district officials to confine their attention to the increase in U-kin, and, if possible, to prevent opium being planted along the main post roads. The li-kin was raised, and remains at 4-8 taels for 1,000 oz., but the Proclamation did not have, and probably was not meant to have, any further effect. The cultivation went on increasing just as usual, along post roads as anywhere else,^ and to-day the poppies bloom close up to the walls of some of the principal cities, along high roads, over hill and dale, and the cultivation, so far as officials are concerned, is unfettered, free' and open to all. There is no system of excise, and no taxation of any kind on either producers or on the product in situ. Beyond the land tax and its supplementary burdens which fall equally on all land in cultivation, and are levied on the owners thereof, opium not in transit pays nothing to the State, and the rural opium-smoker smokes the untaxed product of his district. The opium revenue of the Government is derived from li~kin on opium in transit from one part of the province to another at the rate of 3 per cent. ad valorem, and from barrier dues on opium in transit to the east, amounting, in the aggregate, to from 30 to 40 taels a picul, according to route. Very little opium, however pays as much as this. At Fuchow the U-kin officials reported an export eastward in 1879 of 40,000 piculs of duty-paid opium. It is greater now, and, in all probability, not less than 1,000,000 taels are received yearly from opium dues at this city. At Fengtu, the centre of an opium country of much less extent than Fuchow, opium K-Mn produced in 1880 twelve times as much as it did only a few years ago. Formerly only 12,000 taels a-yearwas received, but latterly over 150,000 taels have been collected in a year. There are inany market towns, too, whereiat periodic fairs, as much as 500,000 or 600,000 taela of opium changes hands, and where U-kin, is received ; and there are other barriers where opium for the east and north is mulcted. So that, allowing a large margin for the expense of collection and other more questionable appropriations, the Szechuan provincial exchequer benefits by opium to an extent not short of 1,500,000 taels per annum. 6. Bmugffling.— The Szechuan dues, though not excessive as opium taxation goes, are a sufficiently onerous burden to make smuggling prevalent andl profitable. Of the amount 30 of the contraband trade eastward it is difficult to make even a guess. The /i-/c/n officials at Fuchow estimate it to be nearly as much as the duty paid m their districts. At otner places it is supposed to be more. In ray last year's Trade Report I showed how common smuggling was amongst all classes of travellers. As additional evidence that occasionally the very highest officials in the Empire are not above a little opium smugghng, I nnay state that when, a jeav or two ago, the Commander-in-chief of one of the neighbouring provine'es was transferred to a -southern command, his personal luggage, on passing tuts port, consisted of four large passenger junk-loads of Szechuan and Yunnan opium, whicn be sold in the east for over 300,000 taels. He is the author of many Proclamations to his troops on the frontier on the degrading habit of opium-smoking. 7. Transit Eastward.— Szechuan opium is not exported by the great highwayot the Yang-tsze, and the S/echuan Yang-tsze barrier at Kweichow gets no revenue from it. A duty of 30 taels per picul at that barrier, irrespective of the amount of dues paid at stations further west, and a second duty of a similar amount at Ichang, are prohibitive, and send the opium export over the mountains which divide Szechuan from Eastern China. Fear of loss by shipwreck in the rapids may also have some effect m keeping opium away from the natural trade route. Be this as it may, the officials at this port, anxious to divert it to the channel of the Yang-tsze, and to get a share of the taxation, now offer to pass a picul as 20 catties, thereby reducing the duty here to 6 taels a picul only, but I cannot learn that this has had any effect. It is an interesting fact, however, showing the freaks which fiscal authorities in the provinces sometimes indulge in. Ihe opium is carried along difficult mountain-paths from Szechuan to Shashih on the backs of coolies. Each man carries 1,000 oz., receiving 7,200 cash from Fuchow to Shashih. At the latter port, some 80 miles below Tchang, it is sent in regular trade channels all over ■ the east and south. The nature of the general carrying trade to and from Szechuan makes this laborious transportation a very easy matter. The crews of up-river junks are double or treble in size those of down-river ones, and, besides, no wages are paid on the down-river trip. There is, therefore, no lack of mountain porters. A large number of the strongest and most active of the trackers of junks bound to Szechuan have, as the most necessary part of their kit, a "ya pien pei lou," or back opium basket, a pecuharly- shaped vessel, which is strapped on the back in Alpine fashion when filled with opium. Having completed their voyage to Chungking, they walk to Fuchow, Fengtu, or other mart, get a load of opium, and trudge back to Hupei with it over the mountains. At Hankow Szechuan opium now figures to some extent in the export list of the Imperial Maritime Customs. In 1880, 927 piculs were exported to other Chinese Treaty ports, and last year no less than 3,891 piculs. It pays at Hankow an ad valorem export and coast- wise duty of 7^ per cent., the value being taken at about 300 taels'a picul. As regards the maritime Customs, therefore, Indian and Szechuan opium are about on an equal footing. It is worthy of note that Szechuan opium, after payment of dues in Szechuan, after further dues at one or other of the Hupei barriers, after an export duty of 7^ per cent, ad valorem, and after the expenses of coolie transport and river freight, is still able to bear fresh taxation in the east, and be cheap enough to supply the poorer classes, who cannot afford the high-priced Indian drug. 8. Price ; Adulteration. — The cheapness of Szechuan opium is in some measure to be attributed to adulteration. Oil, glue, and other innocuous stuffs increase it in bulk; abominations of various kinds add to its strength, and as much as 30 per cent, of these foreign matters are mixed in it by Szechuan producers and dealers. When pure, it is not inferior to any other native growth except Kansuh, which, I may here state, is considered almost as good as Indian. Adulteration having been followed by heavy losses, an effort to be honest was made in 1881 with considerable success. The opium crop brought to market last year, though the produce of an unfavourable season, is the best Szechuan opium that has been seen for years, because the purest. Generally speaking, Szechuan opium is worth at Fuchow from H to 14 taels per 100 oz., according to the season, being dearer as it gets older. Until last year it was considerably cheaper than Yilnnan opium, as the following price-list shows : — Peiob of 100 Chinese Ounces of Native Opium at Chungking in October. 1878 1879. 1880. 1881. Yunnan Szechuan Taels. 22 16 Taels. 18 to 20 12 to 13 Taels. 16 14 Taels. . 15 19 but in December 15 taels. 31 The extremely high price of Szechuan opium in October and November last year were caused by extensive purchases made in the east in fear of an immediate and large increase in taxation. This speculation had a widespread effect on the whole trade of Szechuan, and as it was the most important commercial event in the west of China during the year, I shall give some account of it when J come to treat of the effect of opium on inland exchange. 9. Yunnan Opium. — The gradual decline in the price of Yunnan opium is, in my opinion, the result of its increased production. In 1875 the Grosvenor Mission reported that fully one-third of the whole cultivated area of the province was devoted to opium in winter. Writing in 1879, Mr. Baber, in his able Report on opium, estimated that 12,500 piculs of Yiinn an opium came into Szechuan yearly; that the 3,000,000 inhabi- tants smoke ahout 7,000 piculs yearly, and that 5,500 piculs are exported in other direc- tions than by way of Szechuan, making a total yearly yield of 25,000 piculs. Recent travellers describe the province as rapidly recovering from the desolation produced by the suppression of the Mahommedan rebellion, and opium as being grown in every field as fast as it is brought back into cultivation. The yield for 1881 is reported to me as at least 40,000 piculs, and I see no reason to doubt it. Another reason for the cheapness of Yiinnan opium in 1881 is that Shensi and the north-west, to which in former years a considerable quantity of Yiinnan opium was sent, now produce opium of singularly fine quality sufficient to supply nearly all local requirements. This fact is a fitting commentary on the statements made last year by Tso Tsung-tang, when Governor- General of the north-west, that he had uprooted the poppy throughout his jurisdiction. 10. Prevalence of Opium-smoking in West. — Before giving an estimate of the amount of opium produced in Szechuan, I must refer, in explanation of the large figures I shall be obliged to use, to the extraordinary prevalence of the habit of opium-smoking in Western Hupei, in Szechuan, and in Yiinnan. It prevails to an extent undreamt of in other parts of China. The Roman Catholic Missionaries, who are stationed all over Szechuan to the number of nearly 100, and who, living amongst the people, have opportunities of observa- tion denied to travellers, estimate that one-tenth of the whole male adult population of the province smoke opium. Mr. Parker, after travelling all over the thickly-settled parts of the province, estimates the proportion of smokers thus : — Per cent. Labourers and small farmers .. .. .. .. .. 10 Small shopkeepers . . . . . . . . . . . . 20 Hawkers, soldiers . . . . . . . . . . . . 30 Merchants, gentry . . . . , . . . , . . . 80 Officials and their staffs .. .. .. .. .. .. 90 Actors, prostitutes, thieves, vagabonds . . . . . . . . 95 I agree with Mr. Parker that the proportion of smokers varies in different classes according to their means and leisure, but I feel sure his estimate of the percentage amongst the labouring classes is much too low. One of the most numerous class of labourers in China is the coolie class, day labourers who live by picking up odd jobs, turning their hands to any kind of unskilled work that may be oftered. Certainly more than half of them smoke. Of the labouring classes who are not " coolies," as a whole this much may be said — they only have money at stated intervals ; and when out of a gang of forty or fifty workmen or sailors only four or five smoke opium, it does not mean that only 10 per cent, are smokers. In all probability, half of the whole gang squandered their wages the day they got the money, and have nothing left to buy opium or anything else until the job or voyage for which they have been engaged is finished. For example, of ray junk crew on my voyage to Chungking, only four smoked opium regularly, but seven others who had spent all their wages before we started smoked whenever I gave them a few cash. The total abstinence of a British sailor at sea for months on end proves nothing ; it is what he will do when he has lOZ. in his pocket, and is in a street with fifteen public-houses, that decides his sobriety. So of workmen in the west of China, a large number smoke opium when they have money, and do the best they can when they have none. Whatever be the exact percentage of the opium-smokers in Szechuan in the whole population, it is many times larger than in the east. An interesting Report, based on Returns by the Commissioners of Customs at the various Treaty ports, and published by order of the Inspector-General of Customs, tries to show that opium-smokers constitute only two-thirds of 1 per cent, of the population. However true this may be of the seaboard provinces (1 do not for a moment question its accuracy), it does not apply to the west of China. The impression one actually gets in a Szechuan city or village is that everybody smokes opium, and one is surprised to hear on good authority that 40 per cent, do not smoke. The percentage is here no question of 32 fractions of 1 per cent., but of 30,40, or even 60 per cent, of the whole male adult population, and thousands of women besides. In the city of Chungkmg, for instance, where there is a population of 130,000, there are 1,230 opium shops. I^jvinter, when the two rivers are crowded with junks, and the foreshores covered with booths, the population amounts to over 200,000, and Mr. Parker estimates the number ot opium- shops then at 2,000. At no one of these is less than 2,000 copper cash worth of prepared opium sold a-dav, or, at the smoker's price of 32 cash for 1 mace, 6 oz. of opium, ihis fiives a daily consumption of 12,000 oz. of opium, or 2,740 piculs per annum. Ichang, again, has a population, including junks, of not more than 30,000, but it has 700 opmm- shops at least. The minimum daily amount sold at each of these is 2,000 cash worth, or at 48 cash for 1 mace, 4 oz. of opium, making a daily consumption for this Small city ot 2 800 oz., or 410 piculs per annum. Iq country hamlets and villages the state of thmgS is just as extraordinary. Passing along the main street every second house almost is an opium shop, and wherever there are two or three houses grouped together one sees the ubiquitous opium sign-board and lantern, and smells the fumes of the drug. In some rural districts they smear the lips of their idols with it, and burn at funerals paper facsimiles of pipes and opium, so that their dead may enjoy in the next world the comfort and solace they loved in this. In all this vast region of opium smokers Indian opium is unknown. Only a few dozen piculs of it reach Chungking yearly, where it is mixed with the Yiinnan drug, and, under the name of " Canton opium," used for presents or for smoking on high days and at feasts by the rich. 11. Effect of Opium-smoking.— As to the effect of this habit on the people, amongst whom it is so widespread, there is but one opinion. Baron Richthofen, the most experienced traveller who ever visited Szechuan, after noticing the extraordinary pre- valence of the habit, says : " In no other province except Hunan did I find the effects of the use of opium so little perceptible as in Szechuan." Mr. Colborne Baber, who knows more of the province and its people than any living Enghshman, says : " Ifowhere in China are the people so well off, or so hardy, and nowhere do they smoke so much opium." To these names of weight I add my own short experience. I found the people of Szechuan stout^ able-bodied men, better housed, clad, and fed, and healthier looking than the Chinese of the Lower Yang-tsze. I did not see amongst them more emaciated faces and wasted forms than disease causes in all lands. People with slow wasting diseases such as consumption are, if they smoke opium, apt to be classed amongst the " ruined victims " of hasty observfers, and amongst the cases of combined debility and opium-smoking I saw, some were, by their own account, pseudo-victims of this type. There were some, too, whose health was completely sapped by smoking combined with other forms of sensual excess. And no doubt there were others weakened by excessive smoking simply, for excess in all things has its penalty. But the general health and well-being of the Szechuan community is remarkable ; to their capacity for work and endurance of hardship, as well as to the material comforts of life they surround themselves with, all travellers bear enthusiastic testimony. 12. Consumption, how estimated. — According to the official Heport of the Imperial Maritime Customs alluded to above, 3 mace of opium is the " average " smoker's daily consumption. Although this is probably correct as expressing the amount smoked by those who are moderate, that is, neither heavy nor light smokers, it must be borne in mind that while there are hundreds of heavy smokers there are hundreds of thousands of light, and 3 mace is therefore quite an erroneous average to be used as the index either to the number of smokers a given quantity of opium will serve, or to the amount of opium a given number of smokers will consume. The disproportion between the numbers of heavy and of light opiutn-smokers is so great that such estimate must be based on an index figure only slightly above the light smoker's daily quantum. This, in Szechuan, is about 20 copper cash worth, or five-eighths of a mace. The average amount smoked by all grades of smokers in the province must be very much nearer 1 mace than 3. To make sure of my not over-estimating the quantity consumed, I take the average or index figure to be 1 mace, costing 32 cash, or Ifd. to l-i%d., as against S^d. paid in the east for a similar quantity of the Indian drug. It would be impossible to apply this index to the proved daily consumption of the cities of Ichang and Chungking in order to find out the number of smokers, because tbe master, owner, and deck hands of every junk leaving these ports buy there large amounts of opium for consumption during the voyage. But in applying it to the whole province, it may be depended on to give the minimum possible consumption. From the amount thus arrived at due deductio"n will have to be made for resmoked opium, for I must explain that three " t'ao " or " drawings " are often smoked from the same opium, and from unadulterated drug sometimes as many as five. The leavings of the rich smoker are mixed with the opium sold to the poor, the refuse of the 33 poor is smoked by him again, and the unsmokable dregs are drunk in tea by labourers, sailors, and others who have not time to knock off work for a smoke. An ounce of crude opium is often worked up in this way to weigh If oz. of prepared, although, if unadulterated, it would only turn out seven-tenths of an ounce, or even less. 13. Consumption, amount of. — To come to figures of consumption : — The population of the province in 1812 was given at 21,000,000. Supposing it to have been very much less than that in reality, it can hardly now, after seventy years of a prosperity less interrupted by rebellion and famine than other parts of China, be less than 26,000,000. I should be justified, indeed, so far as any information I got locally goes, in putting it at 35,000,000, but I deem it the more prudent course to take a low estimate. Of these, 13,000,000 would be males, and, rougbly speaking, 6,.500,000 male adults. I take as the minimum number of opium-smokers 30 per cent, of the male adults, 1,9.')0,000 ; women and youths, 250,000 ; in .all, 2,200,000 smokers of 1 mace per day. The total amount of opium smoked in Szechuan is therefore not less than 50,000 piculs of the prepared drug. With a low estimate of the population, a very low percentage of male adult smokers, with a small average allowance for each smoker daily not beyond the means of the poorest, I feel sure I have arrived at the minimum consumption of the province. It may be very much more — it likely is; but it cannot be less. To produce this quantity of prepared opium, 71,000 piculs of crude opium at least would be required ; but the Szechuan drug is, as I have said, so adulterated with rubbish and opium already smoked, that these 50,000 piculs of prepared opium are probably made from as little as 60,000 piculs of crude. "With the exception of somic 5,000 piculs of Yunnan opium, smoked, for the most part, in districts west of Chungking, and a few piculs of Indian and Kansuh opiuu), the whole of this is grown locally. Baron Richthofen, following a similar line of inquiry in 1870, obtains the same result. In his calculation, however, there are two erroneous postulates : one, that an ounce of crude opium gives an ounce of prepai ed, and the other that smokers pay for prepared opium at the same rate as dealers buy crude. The effect of the first is to make his result too small, of the second too large, so the two sources of error probably neutralize each other. 14. Export, amount of. — The amount of opium exported from Szechuan is increasing yearly. Mr. Baber, writing in 1879, estimates it at 130,000 piculs. The li-kin officials at foochow gave the export from that section of the province in 1878 to the east as 70,000 piculs, of which 40,000 piculs were declared and dues paid thereon. The export to Shensi across the Ta Pa Shan was about one-fourth of this, and in other directions and from other parts of the province 43,000 piculs were sent out. Of this total export, 7,000 piculs was Yiinnan opium re-exported, and 123,000 piculs locally grown. What the figures are now I cannot say. I believe the eastern export to be much larger than when Mr. Baber wrote, so large, indeed, last year, as I shall presently show, that its financing proved to be beyond the capabilities of the currency of the country, and brought collapse and disaster on Szechuan trade generally. The export to Shensi and Shansi has fallen off to some extent. I have not, however, such definite and precise information as would warrant any great alteration of Mr. liaber's figures, which, as giving the export of five years ago, may be taken to be as accurate as the nature of the subject will admit. As he himself says, they are not based on bald answers to leading questions, but on careful deductions from observations and inquiries lasting for months, or on information volun- tarily tendered by merchants and officials, and substantiated by collateral evidence. Even allowing for the falling-off in the export to the north and noi'th-east, the total export from Szechuan can hardly be less now than it was in 1878. In all probability it is very much greater. 15. Total production. — The production of opium in Szechuan in recent years may with confidence be regarded as at least 177,000 piculs per annum, of which 54,000 piculs is consumed locally and 123,000 piculs sent to other provinces of China. Reckoning 50 oz. as the average product of a Chinese " mow" of land, or 333 oz. an acre, an estimate which cannot be considered high, since 896 English ounces (675 oz. Chinese) were gathered from an acre of poppies in Scotland in 1830, this produce is the winter harvest of 850,000 acres, and continuing the method of calculations of the minimum, it represents a money value in Szechuan of 34,000,000 taels. Taking the above figures for Szechuan, and allowing to Yunnan the small increase of 10,000 piculs since 1878, instead of 15,000 piculs as reported to me, the total production of Szechuan and South-west China is : — [1238] F 2 34 Piouls. Szechuan consumption of local opium . . . . . . • • 54,000 Szeehuan export, less Yunnan re- export ,. .. .. .. 123,000 Yunnan production (consumption and export) , . . , . . 35,000 Kweichow production, reported to me as . . . . . . . • 10,000 South-west Hupei, Ichang Fu, and Shihnan Fu . . . . . . 2,000 Total 224,000 Or 2| times the whole Indian import into China. I have taken the production of South-west Hupei at tlie very small figure of 2,000 piculs, because last year, owing to drought at seed time and rains in spring, the crop was a short one. The opium of the Ichang Prefecture, grown in the Patung district, has a high reputation, and is superior even to Yunnan growth 16. Efect of Opium on Exchange and Trade. — As I have already stated, the financing of this great export eastward, which in 1878 was of a value of 14,000,000 taels, and was last year much greater, involved the general trade of (he province towards the close of 1881 in ditficulties. The flow of bullion in this part of China is from west to east, and no silver comes to Szechuan from the east. Exports from Szechuan of local produce, where not negotiated against imports, are paid for by means of bills of exchange, payable at sight, drawn by Hankow and Shashih hongs on their agents in Chungking or on the banks of that city, where the trade of the province financially centres. This latter is the case especially with opium, which has to be purchased at cities like Foochow and Fengtu, where little or no import trade exists. Intending purchasers of opium in the east buy these bills and send them to their agents the payees in Chungking. There the bills are cashed and the silver sent to the opium markets. Exchanged for opium, it passes to the opium cultivators and dealers throughout a wide district, whose trade with Chungking is small, and whose river or overland communications with Chungking are difficult. The silver eventually finds its way back to that centre, but it is a matter of time. The uncer- tainty and danger of this arrangement to a financial centre like Chungking, where there exists a highly organized system of exchange with all parts of China, is apparent. Until a year or two ago the currency available for trade purposes was ample for ordinary requirements, and even with a steady drain for eight or nine months of the year to the opium districts no great inconvenience was felt. The present Governor-General of the province, however, shortly after he came into oiHce, instituted a new system of collecting the salt revenue, and when, in 1880, his reforms and new regulations came into full operation, their effect was to withdraw from circulation and keep locked up in the Provincial Treasury a sum exceeding 5,000,000 taels. For nearly the whole of this sum Chungking was drawn upon, but the extent to which the available currency had been contracted was not discovered uptil the opium of the 1881 crop came to market, and the usual drain to Foochow and other marts set in. In the meantime, a Memorial by his Excellency Tso Tsung-tang to the Emperor, recommending a large increase in the taxation on both foreign and native opium, was published in Shanghae, and at once attracted the attention of opium-dealers in the east. The memorialist was reputed to have, and at that time probably had, the highest influence with the Central Government ; and in expecta- tion that the proposed large increase in the li-kin on native opium was certain to be inflicted, whatever happened to the duties on the foreign drug, a rush was made to buy Szechuan opium for the anticipated rise. When I arrived at Chungking in November the speculation was at its height. Opium had risen from i3 to 19 taels per 100 oz. ; the banks had been drawn upon in October and November for over 5,000,000 taels, and had advices of further drafts to be met in December of 1,200,000 taels, all for the purchase of the drug. A silver famine had set in in the commercial metropolis of Szechuan, with a plethora of it in the opium districts unavailable. Apart from the inconvenience to myself in that I found it impossible to negotiate bills for my own funds, the situation was a very interesting one. It evolved itself thus : — The first effect was to drive the weaker merchants and bankers to the wall, some half-dozen of whom closed their doors with heavy liabilities, including 600,000 taels drafts due. So far no great harm was done as the dishonoured paper was promptly referred to the drawers, and most of the money recovered no^ doubt by the original purchasers of the bills. The second effect was the undue appreciation of silver, that is, the undue depreciation of everything for which silver is exchanged in Chungking, foreign goods and native produce alike, and, in short, the derangement of trade for a time. Great losses were incurred by all except the few holders of silver, especially by dealers in piece-goods. As soon as the banks had time to commu- nicate with their eastern agents, and to protect themselves by raising the exchange at Shashih and Hankow on Chungking, their special difficulties were over. But merchants suffered, and when I left in January they were looking forward to the future with appre- 35 hension. The liability of the large opium demand to fluctuations, which, in the absence of telegraph, it is bej'ond the powers of the Chungking banks to gauge the extent of or to control, and the difficulties attendant on an unduly restricted currency, will, they think, put trade in a constant position of unstable equilibrium in future, and make ordinary profit calculations and forecasts impossible. These fears appear to be justifiable. Although the course of exchange and the flow of the currency may be expected to readjust themselves to whatever new conditions the increase in the opium export and the working of the salt regulations impose on Szechuan trade, the difficulties of communication, and the lack of ready transport, not only between east and west but between different parts of Szechuan, will make the readjustment a slow process, and one at best imperfect. Until the facilities for the interchange of products are levelled up to the highly-developed system of exchange banking, the principal effect of the great opium export must remain what it is — to take money from where it is useful and lock it up for a time where it is useless for trade purposes, and the profits which the opium districts make will run a risk of being made at the expense of the general trade of the province. In other words, before Szechuan can expeiienee an increase of wealth and of purchasing power fully commensurate with the value of the opium she now exports, Chungking will have to be connected by telegi'aph with the east, and steamers must ply, if not from Ichang to Chungking, at least along the great waters of Szechuan. Resume. — The main facts regarding native opium in the west are, in sum, these : — 1. Szechuan produces yearly not less than 177,000 piculs of opium; south-west China, including Szechuan, not less than 224,000 piculs. The exact figures cannot be ascertained, but they are probably higher. The limit of profitable production is infinitely far ofl^". 2. The cultivation in Szechuan and Yiinnan is not interfered with, discouraged, or taxed by Government. It is free and open to all. It has for years been, and is now, affected only by natural causes, the law of demand and supply, calculations of profit and loss, and conditions of soil and weather. 3. No Indian opium is consumed in all this region, although opium-smoking, it may without exaggeration be said, is a universal practice. In addition to supplying its own wants, Szechuan exports enormous quantities to the east, where it is smoked by the poorer classes. 4. The payment of this export at present tends to derange the currency of the province, and to hamper trade, a state of things which can only be transitional. Improved communications and transport would soon remedy this. 5. Opium in transit aff'ords a valuable revenue to the Government; to the Szechuan provincial exchequer a net sum of not less than 1,500,000 taels ; to the Hankow Maritime Customs revenue, a yearly increasing export duty ; to the exchequers of the other provinces it passes through or is smoked in, dues varying from 10 to 25 taels. 6. " Nowhere in China are the people so well off", and nowhere do they smoke so much opium." Thus, writing of Szechuan, Baber, Richthofen, Blakiston, Gill, and all travellers ; thus, experience generally. Although these facts speak for themselves, I may be allowed to add one or two obvious inferences. Were Indian opium the fatal poison and scourge in the east it is sometimes asserted to be, one ought to find in the west, where ten-fold more opium is smoked, a debased, debilitated, and impoverished population. On the contrary, it is notorious that the reverse is the case, and that the people, both in body and estate, are amongst the most prosperous in China. Unless it can be proved that Indian opium contains some noxious principle which does not exist in the Szechuan drug, the hypothesis of the fatal poison is open to the gravest doubt. So far as my own experience goes, I have seen on a Saturday night in the streets of a large town in England more vice-born misery than I did in four months in the greatest opium-smoking province of this Empire. The ordinary Chinese opium-smoker is no more a " victim " to opium than a navvy is a " victim " to his daily quart ; and such part of the general fiow of sympathy in England for misery in foreign lands as is given to him might well be retained at home for a worthier object. Again, if it be remembered that a great extent of the Province of Szechuan is under opium cultivation, that the industry is now a livelihood to cQuntless faniihes, that its product is deemed by milhons to be essential to their daily happiness, the difficulty of putting down cultivation by force is apparent. The right of the people to grow and to smoke opium has been for years unquestioned by their officials; to compel them to surrender the right now would be to provoke a rebellion. Even if the Government were willing to incur this risk, and determined, coute que coute, to be rid of opium, which it would be at present nonsensical to affirm, success would require a vigorous Executive, free from venality and opium-smoking, having under its orders armies of constables equally 36 free from these faults. But China has no such Executive, and no sqch armies. Of the local official class, their attendants, hangers-on, and constahles, it may truly be sai4 that if there is one quality more conspicuous than their venality it is their love pf opium- smoking. Even were the prospects of a bond fide effort not a chimera, its success would be impossible. What, under the circumstances, would be the practical eflFect of the rigorous prohibi- tion of opium cultivation in India, and the attempted exclusion by China of foreign opium^ it IS easy to see. Its effect on opium-smoking in Yunnan, Kweicl;ow, Szechuan, Kansuh, Shensi, and Western Hupei, where Indian and foreign opium are almost unknown, would be nil.. Amongst the poor in the east, who now use the native drug, its effect would be equally nil. Many who now use Indian opium would take to native, and one effect would be to give a great stimulus to production in the west. But the well-to-do smokers in the east and seaboard provinces, amongst whom I include all the average smokers who spend iOd!. a-day on Iftdian opium, would everywhere seek for high-classed smuggled opium. Smugghng would be organized all along the coast ; Chinese desperadoes would find willing associates in running foreign opium into the country in European and American adventures ; the Maritime Customs Service would have to become an armed force ; quiet seaports would be turned into hells of disorder, and international relations between China and foreign Powers be embittered to an intolerable degree. The opium which could not be grown in India would come in part from Turkey and Persia ; new fields for its growth would be opened up in Mozambique and similar latitudes in Africa ; and the profits of the trade, instead of passing, as they do now, to the support of our beneficent rule and civilization in India, would become the incentive to, and the reward of, lawlessness, disorder, and crime. Transit Trade. The following Table shows the value of the goods and produce carried under transit ' pass in 1881 as compared with the previous year: — Taels. Inward transit .. .. .. .. 989,188 831,484 Outward transit . . . . . . . . 689,995 406,324 There was a considerable increase in the number of passes issued; 1,681 in 1881, against 1,178 in 1880. No passes were taken out by Chiaese merchants for inward cargo, although their right to do so is acknowledged by the local officials, and understood by the merchants themselves. Applications for inward passes are made in the name of a foreign Hankow firm, and outward passes are issued to Hankow firms at Hankow. In October last I had an opportunity of bringing to the notice of the Superintendent of Customs at Kweich'jw the excessive rigour with which the goods of British merchants under transit pass, especially tin-fined cases of woollens, were examined. He agreed to limit the opening and examination of such goods in future to one case in ten, provided the goods belonged to' merchants who were not in the habit of attempting frauds at the barrier, and provided the marks and numbers of each case were undefaced and in agreement with the transit pass. General. I have little to add to my notes of last year regarding up-river navigation to Chung- king. I have passed the rapids both at the height of summer flood and at dead low water, but trips in a native boat by an unskilled and unscientific observer can add little to the elucidation of the problem of their passage by steamers. T am of opinion that they would, during the summer floods, be no obstacle to a steamer whatever, but during the rest of the year any attempt to steam from Ichang to Kweichow will be attended with risk until an accurate survey of the river at two or three different seasons is made. From Kweichow upwards there would be ho difficulty. Both on the great river and its tributaries there are hundreds of miles of water-way navigable by light-draught steamers, and even in the event of the rapids being found too dangerous for steamer traffic, the question of the throwing open the Szechuan waters ought not to be lost sight of. The advantage of this to foreign trade, and especially to the province itself, would be very great. No foreign merchants have as yet established themselves at Ichang, and, except as steamer storage and forwarding agents, there is no field for any. Foreign goods for the 37 interior of China are now-a-days purchased at Shanghae, by the local Chinese merchants of the different inland cities. Shanghae, offering the double advantage of a large market to choose from, and a centre of gaiety and pleasure withoiit a rival in ths Empire^ bas absorbed the import markets on the lower Yang-tsze. Where Hanko# even has failed, Ichang and Chungking are not likely to succeed. The foreign community at Ichang consists of the stiaff of the Imperial Maritime Customs, three missionaries and their families, and myself. The summer of last yefer was hot and trying, and as we are all miserably lodged in Chinese houses, we were constantly ill. We can keep water out of our houses, but not dysentery and fever. The lonely life of a Consular officer in such a port as Ichang would be much more tolerable were he housed in a foreign-built house lifted a few feet from the level of the ground. I have been informed that what was good enough for my predecessor is good enough for me, but the contemplation of this fact, be it never so true and cogent, does not lift me above the influence of malaria. I have to express my indebtedness to Mr. F. A. Morgan, Commissioner of Customs at this port, for the Tables appended to this Report. (Signed) WM. DONALD SPENCE, Ichang, April 1, 1882. AxUmg Consul. (No. I .) — Direct Trade. Imports and Exports. Nil. (No. 2.) — Indirect Trade. Coast or River Trade. Imports and Exports. General_^Imp6rts in British and Foreign ' Vessels. General Experts in British and Foreign Vessels. Total General Imports and Exports in British and Foreign Vessels. Imports in British Vessels, as distinguished from Foreign. Exports in British Vessels, as distinguished from Foreign. Total Imports and Exports in British Vessels, as distinguished fro:n Foreign. £ s. d. 284,682 15 £ s. d. 134,143 12 6 £ s. d. 418,826 17 6 Nil. Nil. Nil -^J. Tael estimated at 5s. &d. Treasure. Imported iu British vessels Imported in foreign vessels Total Exported in British vessels Exported in foreign vessels Total £ s. d. Nil. li,481 19 6 1,481 19 6 NiL 4,388 14 6 4,388 14 6 Total treasure imported and exported in British and foreign vessels.. .. .. .. .. :. 5,870 14 (Signed) WM. DONALD SPENCE, British Consulate, Ichang, April 1, 1882. Acting Consul. (No. 3.) — Shipping Return of the Port of Ichang for the Year 1881. British. ■Nil. 38 Foreign. Entered. Cleared. Total Entered and Cleared. °s CtH «M Cm •s o O o O O o i bo 1^ 0) O &0 S3 O O TD fcD S "S ' rO-aJ C3 ■° ^ .a '3 5 ■^ s! '^'3 2 ■S !J <0 o 13 a 1 ^ S bo ^1 1 B ^ 3 5d 1 it £ £ £ 83 11,906 • • 284,682 83 11,906 • • 134,143 166 23,812 • • 418,826 Tael estimated at 5s. 6c?. (Signed) WM. DONALD SPENCE, British Consulate, Ichang, April 1, 1882. Acting Consul. (No. 4.)^-Tmports of Foreign Goods into Ichang during the Year 1881. Description of Goods. - Quantity. Value. Taels. Opium, Patna Piculs . , 2 40 912 Cotton goods — Shirtings, grey . . Pieces 143,160 257,688 „ white .. »> 4,710 9,420 „ dyed .. }) . ■ 220 660 „ figured and brocaded 5J ■ • 1,120 3,896 T-cloths 3) • • 26,914 38,248 Drills, English .. 59 • • 30,485 60,129 „ American . . 5J • • 2,145 4,290 Jeans, English 9) . • 1,080 2,160 Sheetings, English S> . • 1,830 3,840 „ American JS • • 4,970 10,960 Chintees. . )J • • 6,818 13,036 Taffachelass 99 " • 1,100 1,720 Cambrics 520 780 Damasks, dyed . . 99 ■ • 1,010 4,040 • Turkey-red cloth . . Velvets .. Velveteens , . Handkerchiefs 99 • . 99 • . 99 • . Dozens 1,400 384 1,044 3,220 3,120 2,338 9,396 805 Ya.rn .. Piculs 12 00 360 Woollen goods- Blankets Pairs 25 94 Camlets, English . , Pieces 5,940 77,220 Lastings.. Long ells Lustres and figured Orleans . 99 . • 7,630 68,670 99 99 . • 5,800 5,037 41,500 19,064 Spanish stripes Broadcloth Eussian cloth Metals — 99 • . 99 . • 99 • . 678 133 1,800 10,170 3,722 54,000 Lon wire ' . . . . , , Piculs 108 00 728 Quicksilver Sundries — 99 • ■ 287 81 14,457 Aniseed, star Betel-nuts . , ■ . . Bicho-de-mnr Birds' nests, 2nd quality . . „ '. Srd „ Brass buttons „ foil .' 99 • • 99 • . 99 .1 99 40 70 48 50 367 47 88 618 250 21,148 1,823 99 • • Gross Piculs 1 75 6,549 56 39 1,372 8,624 1,223 „ ware Cardamons, superior ), inferior ., Cassia Hgnea >. buds 9) . • 99 • • <9 . . 99 ■ • 15 09 25 77 136 80 809 34 352 1,432 3,423 2,477 99 * . 19 65 171 ), twigs Clocks and watches Cloves . . „ mother of . . Cuttle-fish 99 • . Pieces Piculs 99 ■ • 18 81 425 35 87 5 32 280 663 1,116 113 Camphor .. '\ Dyes and colours . . , , '/ "Pans * * 99 • • Bottles ! . 625 73 29 10 93,074 9,382 2,900 33,172 ■*■ WHO • • , , ^ ^ Fish maws Ginseng,. ., Glass ware . . [[ Pieces Piculs 99 . . 20,300 144 84 51 07 280 6,148 11,781 Gold thread, imitation ,', 99 . . 70 87 3 43 1,349 651 39 Description of Goods. Horns, rhinoceros' Isin;^Ia.ss , . Lamps, kerosine . . „ opium , . Lungngans, drit'd . , „ pulp .. Mats Medicines Nutmegs Ornamenls Paper, 1st quality Peel, orange Pepper, black Prawns, dried Putchuek Rattans, split Koiige . . Sandal-wood . . Sapan-wood Seaweed Silk and cotton mixture „ piece-goods . . Sharks' fins, white Silk ribbon Tin-foil . . , . Tin-plate ware Umbrellas Wood ware Sundries, unenumerated Total . . Piculs >» Pieces _)) Piculs )> Pieces Piculs Pieces Picnls Pieces Piculs Value Quantity. 40 429 51 8,916 11,562 49 50 15 40 24,266 28 20 4 10 27,600 57 21 237 sa 403 73 254 43 35 01 88 09 10 68 25 00 152 40 2,863 33 12 74 7 35 64' 89 56 39 46 49 77 1,104 13 12 Value. Taels. 320 11,590 1,025 1,650 200 296 728 243 286 117 1,058 2,623 2,101 4,483 524 964 334 200 737 11,779 1,684 4,058 5,193 260 1,114 507 1,656 253 2,528 885,482 (Signed) British Consulate, Ichang, April 1, 1882. WM. DONALD SPENCE, Acting Consul. (No. 5.) — Impoets of Native Produce into Ichang during the Year 1881. Description of Produce. Quantity. Value. Taels. Bicho-de-mar, black. . Piculs 19 00 1,140 Brass buttons )) • • 22 50 1,677 ,, foil .. »i 6 65 206 „ ware.. t» • • 6 55 222 Cotton, raw ») • « 8,439 87 113,573 Cuttle-fish . . S) • • 404 94 5,460 China-root . . ,, 162 03 1,620 Fans,gpa Der Pieces " 25,920 2,070 „ palm-leaf, trimmed )j • • 1,634 48 „ fancy and silk . . )) • • 1,793 303 Glass-ware Piculs 27 69 548 Gold thread, imitation »j . • 10 31 1,795 Joss-sticks . . ." * * 36 75 370 Jadestone-ware Pieces 874 538 Lamps, opium »? " • 9,151 1,551 Lungngans, dried Piculs 54 00 810 pulp .. )) • • 7 64 - 75 Medicines . . )7 • - 177 97 1,514 Mirrors and glasses . . Pieces 8,005 577 Ornaments . ." ' ' 194,845 660 Paper, 1st quality . . Piculs 42 76 487 „ 2nd quality . . 3" • • 12 60 75 Pearls, false ») 9 22 802 Sea-blubber S) • • 415 55 1,478 Silk piece-goods )l • • 1 50 800 „ ribbons 5» 9 88 4,940 Spectacles . . Pairs 23,169 1,012 Silk and cotton mixtures Piculs 52 150 Sundries, unenumerated Value • • • • 5,227 Total 149,728 (Signed) British Consulate, Ichang, April 1, 1882. WM. DONALD SPENCE, Acting Consul. rt oooT 40 (No. 6.) — NATIVE Product exported from Ichang (luring the Year 1881. Description of Produce. Silk- Yellow Szechuan . . Wl}ite „ i . Refuse „ < . Cocoons . . Piece-goods Sundries — China-root . . Coal . . Copper ore Fungus . . Hemp . . Leather . , Medicines Musk Nutgalls. . Rhubarb Safflower . . Tallow, vegetable . . Tigers' bones Tea, black . , "Wax, white „ yellow k . Sundries, unenumerated Total . . Piculs Value Quantity. Value. Taels. 800 03 169,028 27 91 6,075 615 60 24,269 69 06 2,197 23 23 75 16 522 45,461 00 11,819 6-1 70 2,050 394 79 10,471 1,827 95 12,494 480 73 5,631 12,517 09 131,912 1 87A 11,060 264 19 1,766 812 99 16,642 457 61 25,658 48 40 240 75 00 2,090 50 15 1,245 965 44 51,933 3 80 80 • • • • 590 487,795 (S?igned) British Consulate, Ichang, April 1, 1882. WM. DONALD SPENCE, Acting Consul. No. 8. Sir L. Mallet to Sir J. Pauncefote. — {Received June 22.) Sir, ^ ^ India Office, June 21, 1882. IN continuation of ray letter dated the 31st ultimo, I am directed by the Secretary of State for India in Council to forward herewith a copy of a further letter from the Govern- ment of India, inclosing one from the Bengal Chamber of Commerce, suggesting that all who are engaged in the opium trade should have the opportunity of expressing their views on any question that may affect their interests. I am, &c. (Signed) LOUIS MALLET. Inclosure I in No. 8. The Governor-General of India in Council to the Marquis of Hartington. My Lord, Simla, May 15, 1882. IN continuation of onr despatch dated 24th ultimo, we have the honour to forward for transmission to Her Majesty's Foreign Office, the accompanying letter from the Secretary to the Bengal Chamber of Commerce, suggesting that all who are engaged in the opium trade should have tlie opportunity of expressing their views on any (Question that may afiect their interests. We have, &c. (Signed) RIPON. D. M. STEWART. J. GIBBS. T. F. WILSON. T. C. HOPE. C. P. ILBERT. S. C. BAYLEY. 41 Tnclosure 2 in No. 8, Mr. Wood to the Secretary to the Government of India. April 26, 1882. THE Hong Kong General Chamber of Commerce have forwarded a copy of their letter to your address, dated the 16th of last month, in which they request to be allowed to express their views upon any arrangements that may be in contemplation affecting the trade in opium between India and China, and which may be the result of negotiations pending between Her Majesty's Government and the Government of China. The Committee of this Chamber are not aware of the object of the negotiatioos referred to, but they consider the request of the merchants of Hong Kpug as very reason^ able, and trust that all who are engaged in the opium trade should have the opportunity of expressing their views on any question that may affect their interests. Inclosure 3 in No. 8. Mr. Logan to the Secretary, Bengal Chamber of Cami^erce. May 15, 1882. WITH reference to your letter dated the 26th April last, regarding thej opium trade with China, I am directed to say that it has been forwarded to the Right Hopourable the Secretary of State for India for transmission to Her Majesty's Foreign Office. No. 9. Sir T. Wade to Earl Granville. — {Received July 22.) My Lord, Tien-tdn, June 3, 1882. WHEN I returned to England in 1877, 1 received Lord Derby's permission to draw WP a Report that should pxplain the negotiations between the Chinpae Gc^wrnipeRt ^nd myself^ which, after lasting some two years, were closed by thp signature pf \\^e Qbefp,Q J^gpf^^ ment.* My Report was divided into three parts : the first relating to the Yunnan QV^IfaggJ the second to the questions of official i^itercpurse and admimstrq,tion of jvjstice, in feqth of which Departments improven(ient was desired; the third t:Q trade. I was unable to lay my Report before Lord Derby earlier than tl\e month of July, and by this time objections had been stated to qf rtain arrangements which, ip the Agree- ment, I had undertaken to recommend ; objections, on the pqrt of the Representatives pf five of the^ Treaty Powers, to lirnitation of the area of exemption from inland taxatipn in exchange for the commercial advantages conceded by Chiria ; objections on the part of the Government pf India to my scheme for securing to the Government of Chin^ the farther revexiue it has a right to derive from tariff-paid ppium, the new arrangements contemplated under my Agreement involving the exclusion of the native collpctorates from the port-area which I proposed to qircumscribe. PubHcation of the 3rd Part; of my Agreement was in ppnsequence postppned, The Gpvernment pf India having npw practically withdrawn its objection to the system I recommended, I should be glad if ypur Lprdship were npw to sanction its publication. I accordingly incloses a copj of the paper in question, with the. Appendices. It will havp to be referred to presently when I am reporting on the taxation of the general trad^J fell there is much in it regarding opium whicb I think will be fpui^d to suppprt th§ views pf the Gpvernment pf India. A few verbal alterations have been introduced into the original text. I have, &«'. (Signed) THOMAS FRANCIS WADE. * See "China No. 3 (1877)," No. 39, p.. IH. [12381 G 2 42 Inclosure in No. 9. Part III of Report hy Sir T. Wade, dated July 14, 1877. ******* III. TO come now to Section 3, relating to trade. The case with which I have had to deal requires, I regret to say, a considerable amount of explanation. By Article X of the Treaty of Nanking, signed in August 1842, the Government of China agreed to establish at the five ports then thrown open to British trade a raritf of export and import customs, and other dues. It further agreed that when British mer- chandize should have once paid such dues and customs, it might be conveyed by Chinese merchants to any province or city in the interior of China, on paying a further amount as transit duties, which amount was not to exceed a certain percentage on the Tariff value of the goods. The ratifications of this Treaty were exchanged at Hong Kong in June 1843, but the percentage on value to be levied as transit duties not having been fixed, a declaration was signed by Sir Henry Pottinger and the Imperial Commis.sioner Keying, the same Plenipotentiaries who had negotiated the Treaty of Nanking, to the effect that the charges to be levied as transit duties should not exceed the rates then existent ; these, said the Declaration, being on a moderate scale. The ratifications of the Treaty, it was added, were exchanged subject to the above stipulations. In October of the same year a supplementary Treaty was signed, to certain pro- visions of which, although it was subsequently abrogated, it will be necessary elsewhere to direct attention. At a later period, I am unable to say precisely whether by Sir Henry Pottmger or by his successor, Sir John Davis, there was published, in 1844, a Table of the barriers or stations recognized by the Board of Revenue as those at which transit dues were leviable j leviable, that is to say, on account of Imperial, as distinct from Provincial, revenue. That local dues not accounted for to the Board of Eevenue did at the time exist there is little doubt, but of the nature or amount of these we have no published oflicial evidence. The date of the Code of the Board, from which the list above referred to was translated, was, unless I am mistaken, 1831. So late as 1850 I was unable to procure a more modern edition. My reason for directing attention to the date will be seen in due time. From an early period our merchants complained that inland charges were pressing fitfully and unduly upon their trade, import and export. So far as the latter was con- cerned, indeed, the Treaties extant in no way protected produce on its way to a port of shipment against any charges that the Chinese might choose to impose upon it. Our imports, by tiie Declaration of 1843, were certainly entitled to exemption from all charges inland not authorized before that year. Yet their annual rise was insisted on by the Chinese purchasers of our goods, and having no access to the interior, for the Treaty of 1842 gave us no more th^n a right of residence at the five open ports, we were unable to gainsay their testimony; the truth of which, besides, with our knowledge of the irregularity of Chinese finance, there was no reason to question. This, even up to the year 1849-60, when the insurrection, "subsequently known as the T'ai P'ing, was beginning to make itself felt in the southern provinces of China, and the needs of the Government, real and pretended, became a ground of appeal to the patiiotism of those who were assumed to be best able to contribute to the necessities of the State, or, to speak more correctly, were most accessible for purposes of abnormal taxation. These would be, for many reasons, the mercantile classes. The Imperial revenue, which, in normal times, may amount to some i5,000,000L sterling, is beholden for more than tvyo-fifths of this total to the tax assessed on land in three degrees, lu an insurrection much of the land is of course thrown out of cultivation, and even where this is not the case, much of the land-tax is beyond the reach of the collector. The land-tax is, at the same time, the one impost which it is absolutely dangerous to raise. A direct augmentation of it would, at any time, be the surest means of pro- ducing a rebellion. Abnormal taxation of trade, on the other hand, is attended with no such result. In one instance, where the wholesale and retail dealers were taxed accord- ing to their ledgers, and with such freedom that the sums exacted were held to amount to cent, per cent, upon value, the people closed their shops until the rate of charge 43 was lowered ; but the iniquity produced no rising ; and although through the Censorate and other channels of representation the native trading communities continue now to protest to the Throne against the burden laid upon them, the Grovern- ment has comparatively little difficulty in levying very heavy "patriotic contribu- tions" in one form or other; not solely for war expenses, as it is common to assert, but for other expenses of the Government, general or particular. The sale of the lower offices, or of high official rank, is but one form of abnormal taxation. This, however, does not otherwise than remotely affect trade. The taxation immediately con- cerning it is that known as the li-kin, or li-lduen, the nominally "one per mil contribu- tion," which has' for more than twenty years borne with increasing weight, not only upon the trade in foreign imports, but upon all departments of commerce in China, inland or maritime. The Treaty of Tien-tsin signed by Lord Elgin in 1858 secured by Article IX to British subjects the right of access under passport, whether for business or pleasure, to all parts of the Empire, it added by Article XI to the five ports above enumerated as open to trade, the ports of New-chwang, Chefoo, Tai-wan, Swatow, Kiung-chow, Chin-kiang, Kiu-kiang, and Hankow, and by Article XII it obtained a right to purchase land and to build, not only in the port towns, but in their immediate vicinity. 1 note this stipulation, because I shall have to recur to it when I come to speak of abnormal taxation upon trade within or beyond the limits of the ground at most ports more particularly set apart for the residence of foreigners ; the foreign settlements or so-called " Concessions." By Articles XXYI and XX VII, it was agreed that the Tariff of 1843 should be immediately revised, and that for the time to come a fresh revision should be made every ten years ; and for the regularization of the taxation of trade inland, it was agreed by Article XXVIII, that any British subject desiring to convey produce purchased inland to a port, or to convey imports from a port to an inland market, should be enabled, if he chose, to clear his goods of all transit duties by payment of a single charge. If he did not choose so to clear his goods, he would have to pay the duties leviable, whether upon nativfc produce or British imports, between open port and inland centre. The amount of duties leviable in the latter case was to be declared within four months of the signature of the Treaty. The Tariff of import and export duties was duly revised in the autumn of 1858 ; but the Declaration promised in Article XXVIII was not ready. In the then state of the Empire it was impossible that it should be. Up the valley of the Great River, and throughout the central provinces of China, the Tai-P'ing rebels, although their con- sistency had been much impaired, were still in force. Six years were yet to elapse before the recovery of I^an-king. The provisions of Article XXVII t were consequently modified ; and in Rule 7 of the Regulations appended to the Tariff, it was agreed that the Article in question should be interpreted as declaring the amount of transit dues legally leviable upon merchandize imported or exported by British subjects to be one- half of the Tariff duty leviable at the port of shipment or entry upon such merchandize. A British subject, desiring to clear imports inland by payment of the half-duty, would have issued to him, on application, a certificate, exhibition of which along the line of bai'riefs through which the merchandize must pass to the inland centre specified would free the imports of all other charges'. If he were bringing down produce for exportation from the interior, he was to have it inspected at the first barrier upon- the line of transit, and he would then receive a Memorandum which would similarly clear this produce down to the barrier nearest the specified port of vshipment. Here the half-duty would have to be paid. Unauthorized sale in transitu of produce, entered as above for a port of shipment, would render it liable to confiscation. So would an attempt to pass produce in excess of the amount stated in the Memorandum. At the port of shipment permission to export produce, which could not be proved to have paid its transit dues, would be refused by the Customs. This arrangement rendered unnecessary the notification of inland Tariffs stipulated for in Article XXVIII of the Treaty. It should be specially noted that clearance, inwards or outwards, under its conditions, was not made obligatory. An option was left to the British merchant to avail himself of the new rule or not. By Rule 5 of the same 'J'ariff Regulations the restrictions affecting trade in various commodities heretofore declared contraband were conditionally removed. Of these commodities the first-named, opium, was the chief. It is unnecessary here to refer to the conditions regarding any other. The steps taken by the High Commis- sioner, Lin, to suppress the trade in opium, had been, it will be remembered, the imme- diate occasion of our first war with China. A proposal to legahze it had not been wholly unsupported by Chinese statesmen shortly before the time of the rupture, but 44 it was strenuously withstood both then and during Sir Henry Pottinger's negotiations ; by some for financial reasons, the alleged export of silver occasioned by the op^ni trade having produced alarm ; by many, no doubt, on moral grounds ; by many trom an unvviUingness to face the censure that would not have failed to await overt advocacy of its legalization. Covertly, it was more than connived at. It is not too much to say that the trade was encouraged. The drug was not admitted into the open ports; at least not into the anchorages defined by the Customs ; but it was sold at any pomt along the coast from Shanghae southward, at which it suited the foreign importer to station a receiving ship. Such vessels, I may be reminded, were heavily armed. They were; but for then- protection against pirates, not against the authorities. The authorities, it may again be urged, had, at the time, no executive fit to cope with armed opium clippers, had they been disposed to expel them. They had not ; but they made no effort whatever on shore to deter the people from frequenting the receiving ships. On the reverse, the opium landed from them was, from 1842 if no earlier, farmed or otherwise taxed, and in 1858, when Lord Elgin took the matter up, li-kin was levied upon opium as regularly as upon any article of the regular trade. These circumstances had no doubt their due weight with Lord Elgin when he suggested once more the introduction of opium into the TariC But his Lordship did not ignore the fact that, while the degree to which Indian opium is abused in China is grossly exaggerated, it was yet beyond doubt that there is in the Chinese consumer a pronounced tendency to exceed in the use of the drug, and that such excess is too commonly followed by fatal consequences. He drew, therefore, a marked difference between the trade in opium and in other imports. He was prepared to concede any Tariff duty that the Chinese Government might demand, provided the import of the drug were so recognized as to bring it formally within the range of Customs sur- veillance, and thus to extinguish the discredit attaching to a trade which, though regularly taxed by the authorities, was technically contraband; but, to use his own expression, he would not assist his countrymen in scattering opium broadcast through the land, and he spontaneously conceded that it should be sold by the importer at the port only ; that it should be carried into the interior by Chinese only, and only as Chinese property ; that the British trader should not be allowed (as in the case of other imports) to accompany it inland; that neither the provisions of Article XIX of the Treaty of Tien-tsin, by which British subjects are authorized to proceed inland to trade, nor those of Article XXVIII for the regulation of the transit dues, should extend to it ; that the transit dues on opium should be arranged as the Chinese Grovernment might see fit, and that in the future revisions of Tariff provided for by Article XXVII of the Treaty, the rule of revision applicable to other goods should not. be applied to opium. To put it more briefly, if the Chinese would but include opium in tlje Tariff, they were to be free to do what they pleased with it. I am satisfied that these words do not mis- represent Lord Elgin's intentions regarding the trade. 1 state it thus explicitly, not as an argument for or against the morality of the trade in opium, but in indication of the position that I conceive Lord Elgin assigned to the trade, as distinct to that assigned to the trade in other British imports. It may not be out of place here to observe that but a few months after the negotia- tion of the Tariff, almost at the same moment that Sir Frederick Bruce, Avith the ratified copy of the Treaty of 1858, was being driven back from the Pei Ho, orders were sent down from Peking to levy a li-hin duty of 80 taels per picul on opium. The order was the result of an unpublished Memorial from the Governor-General, Ho, then resident at Soo-chow, who, if 1 recollect right, remonstrated against the proposed rate as excessive. 'I'he.hollowness of the objection of the then Central Government, on moral grounds, to the admission of opium, and its appreciation of the value of the .trade to the Exchequer, are more or less attested by this incident. Sir Frederick Bruce's reception at the mouth of the Pei Ho having rendered necessary, in 1860, the second mission of Lord Elgin, Tien-tsin was added to the ports opened by the Treaty of 1858, and the provisions both of thi^ Treaty and of the subsequent Convention of 1860 came, to a certain extent, into operation. To a certain extent only. However good in our eyes our cause of quarrel, however indisputably moderate the concessions exacted by Lord Elgin, the hostilities of 1856-60, and eminently the last campaign, had naturally irritated the Centrrtl Government, and, as we now know, within a fortnight of the issue of the Decree directing promulgation of the Treaty the provincial authorities were instructed " to let the spirit of restriction abide" in all arrangements of detail that the Treaty must render necessary. The committee of favourites then in power was, it is true, exceptionally corrupt and despotic but the instructions sent through them were little else than what might have been looked fbr, the traditions of Chinese foreigii policy considered. It is ceftaiii that no provincial Grovetnor receiving them would regard them as unfair or unreasonable. We were not long, consequently, in encountering difficulties of various kinds ; above all in the operation of those clauses of the Treaty that affect what we are wont to call the Transit Duty question. I employ the phrase most in vogufe, but it should more properly be described as the question of Inland Taxation. It must be admitted that, however much of wrong under this head we may lay d,t the door of the ill-will or bad faith of the Chinese G-dvernment, central or provincialj a certain portion of our difficulties is to be traced to the inevitable inexactness with which our rights are defined in the clauses on which those rights are assumed to be based. I am referring more particularly to the clauses concerning our import tradis | to our manufacturing millions, the trade of chiefest consequence. To spe^k of the Chinese contention during our fifteen years' discussion of the matter would b6 almost a misapplication of terms, for they have rarely vouchsafed any other rejoinder to Our protestations against taxation over and above the Tariff duty than the one — that th^^ Government is free to tax its own subjects as it pleases, no matter what the nationality of the goods taxed. They have, at all events, adhered to this principle in action. They have pushed the collection of li-kin up to the very doors of our warehouses. At Axnoy the li-kih collection has strangled the trade which from 1860 to 1865 had been flourishing. In the latter year the Tai P'ing rebels, driven southward, invaded the province of Fuh Kien. This event authorized the introduction or augiiientation of li-kin taxation. It has ever since been maintained in Fuh Kien, ostensibly to support the war on the Turkestan frontier. I have reason to believe that, until lately^ the li-kin on imports at Amoy was equal to at least three times the Tariff duty. Our information is not, however, of the best at any port. Even at Shanghae I have found two authorities, both of whom I should have held to be equally valuable, assuring ftie^ the one that li-kin taxation amounted to but 2 per cent, upon our imports, the other that it was not less than 25 per cent. I return to the interpretation of the Treaty clauses. I have said that the definition of our rights in these was insufficiently exact ; and that this was inevitable, because our information was inevitably imperfect. The only data really vouched for on official authority were those already referred to in the Code of the Board of Revenue, a list of the stations at which inland revenue was collected on Imperial account. We did nOt know, and do not now know, what transit duty stations, not in the Imperial list, exi&led before 1843. We were at the same time certain that abnormal taxation was multipltiri^ in every direction, whether on Imperial or provincial account mattered little ; we could obtain no authoritative intimation of its nature or amount. The responsibility of this unacquaintance with details so important to our interests must be charged, I need hardly say, not upon Lord Elgin, but upon those whose function it was to provide him with information ; and of these I was one of the chief. I cannot, however, blame either myself or otherSj my colleagues, for failure to achieve what we desired in this regard. Data for a Chinese budget are still somewhat beyond the rfeach of any inquirer, native or foreign. Lord Elgin's new Tariff was framed as imposing duty at the rate of 5 per 'cent. upon value as shown by inspection of the only papers then worthy of trust, the Returns of the Shanghae Customs prepared during the previous thrfee years by Mr. Horatio Lay. The accordance of the half-duty, that is, of an additional 2| per cent., by payment of which the charges described as transit dues were to be commuted, was declared by th'e Chinese authority, with whom the Tariff wus negotiated, liberal. Lord Elgin doubtless hoped that, this paid, our imports would be free of all other charges. I remember his observing, as the Tariff was about to be signed,' that he thought if the Chinese Government got 7^ per cent, on our trade it ought to be satisfied. He at the same time admitted that once our goods had passed into Chinese handsj he did not see how to secure them against further taxation. But to what exfent was the payment of the Tariff duty alone to avail imports ? When would they become liable to the charges which the importer was to be free to commute by payment of the half-duty ? It did not devolve upon Lord Elgin to answer the question, for his Lordship had left China before the Treaty had eome iuto operation. But his brother, and successor, wheU it presented itself, was prepared to give an answer very favourable to the Chinese ; for, but for the words that rhake it optional with the British merchant to compound for inland taxation by payment of a half Tariff dutyj or to face the inland charges whatever they may be, Sir Frederick Bruce would have preferred to make the composition compulsory^ and the half-duty payable at the same maineut as the Tariff duty ; that is, at the mcraent that the impoz^ts were landed. 46 Eeference as above to Sir Frederick Bruce's opinion of what was fair to China, as T shall proceed to show, is not irrelevant. At the time that he advanced it (in 1861-52) li-kin was not, at least so far as the import trade is concerned, the onerous burden that it eventually became. Transit passes had been in many instances refused, m many not respected. Sir Frederick Bruce was persuaded that, in the then condition of the country, the interests of our import trade lay most in the removal of hindrance to the circulation of our manufactures ; and the form of hindrance, which he would have wished to remove, was the detention of consignments travelling inland at the transit-duty stations, or barriers, in the interior. The certainty that the British importer had paid the sum by Treaty agreed to as composition for all barrier dues, it might be hoped, would deprive the collectorates of their excuse for delaying goods certificated in transitu. I am so far but stating the history of the case, but I *hall observe in passing that Sir Frederick Bruce's views of the rights of China in respect of the import trade fairly coincided with the view of his brother, the negotiator of the Treaty of 1858 ; to wit, that the Chinese should get 7^ per cent, of revenue from our imports. I repeat that neither in Lord Elgin's mission, nor in that of Sir Frederick Bruce, was the information at our disposal complete ; nor, even in the latter period, I may add, liad we had sufficient experience of the working of the Treaty. Meanwhile, the weight and method of inland taxation were yearly more complained of, and in 1867, when the revision of the Treaty of Tien-tsin was undertaken by Sir Eutherford Alcock, relief from li-kin or other inland charges became the object to which his main efforts were addressed ; and this he attempted, though not precisely in the form contemplated by Sir Frederick Bruce, yet, in one important particular, in the same direction. Sir Frederick Bruce would have had the British merchant's option to compound or not for inland dues extinguished, and the half-duty composition rendered obligatory ; but the half-duty paid, he would assume that, throughout the Empire, no farther tax of any kind would be imposed upon the imports. I am speaking, be it noted, with the knowledge my position as his Secretary of Legation gave me of the opinions of my Minister. His proposition never came before the Chinese; nor, so far as I can recollect, is it anywhere recorded. Sir Eutherford Alcock would also have suppressed the option left by the Treaty of 1858; but the exemption from taxation inland would have been subjected (and I think fairly) to certain limitations. It will be simplest to quote the Convention signed by Sir Eutherford on the 23rd October, 1869. (See Blue Book, "China No. 1, 1870.") "AETICLE III. " It is agreed that commodities of the following classes and denominations, viz., cottons, linens, woollens, woollen and cotton mixtures, &c., &c., imported by British merchants, shall pay both import duty and transit due simultaneously at the time of importation. " On the other part, China agrees that the above-mentioned commodities, imported by British merchants, and having paid import duty and transit due simultaneously at the time of importation, shall be exempt from all other taxes and charges whatsoever in Treaty-port provinces." Mr. Hart, the Inspector-General of Customs, who had naturally acted throughout great part of the trade negotiations as intermediary between the Tsung-li Tamen and the British Legation, at Sir Eutherford Alcock's request, appended certain marginal notes to the Convention. The following is his commentary upon the Article above cited : — " This is a most important concession, for it permits manufactures (the goods in whose sale England is chiefly interested) to circulate freely without certificate, and without further charge or tax, on payment of 7^ per cent., through the Treaty-port provinces. It is a concession far in advance of the Tien-tsin transit clause as regards one-half of China, and as regards the other half, the former transit privilege is continued in force. The ' supplementary regulations ' will show the action to be taken." The last line of Mr. Hart's note here quoted refers to the Supplementary Eules signed with the Convention, of which Eule I, § 4, runs thus : — " When commodities of the kinds specified in the first clause of this Eule, and which simultaneously paid import duty and transit due, are to be conveyed by either British or Chinese merchants to non- Treaty-port provinces, transit certificates should Be procured from the Customs at the port started from, on the face of which will be distinctly set forth the name of the place for which the said commodities are destined. " On their way from the port to the place thus set forth in the certificate, such certificated com- modities will be exempt from all liability to inland charges, dues, or duties. But in the event of its being discovered by any Customs station that may make examination that the merchaaidize contained 47 in the packages is different from the commodities set forth in the certificate, or that the certificate is for a less quantity than it is accompanied by, the goods concerned will be confiscated. " On the arrival of such duly certified commodities at the place set forth in the certificate, the certi- ficate will become invalid, and the commodities having arrived at their place of destination, will be liable to whatever inland charges, dues, or duties the locality they are found in collects, and will thence- forth be treated like native produce in the -localities concerned." Now, before going further, I shall briefly re-state what I conceive to be the present contentions as regards taxation of our imports, of the Chinese Government on the one part, and of the British merchant on the other. Both parties are, at least, agreed thar the half-duty is not imvnediately leriable ; but that the payment of it must be attested by certificates, and that the production of the certificate shall avail the holder to clear the imports entered upon it from certain taxation. Beyond this, the Chinese contention, or, to speak more correctly, the principle recognized in practice, has been that duty-paid imports, though not as yet even presumably liable to payment by the importer of the half-du1;y, are liable to li-ldn or other taxation if in the hands of a Chinese dealer ; that goods accompanied by a transit duty certificate, that is, by the required evidence that a half-duty has been paid in addition to the Tariff duty, are free only of dues at the barriers at which transit duties are collected ; and that, on arrival at the stated inland centre to which the imports are to be carried, they are subject to any taxation that may be imposed upon them. Although I cannot call to mind that, in discussion, the right of certificated imports to exemption from barrier dues has ever been disputed, it is none the less true, as I observed before, that certification has been sometimes refused altogether ; also that goods duly certificated have been detained at barriers, the plea of their deten- tion being irregularity, by no means always substantiated. (See Appendix I, Levy of lA-lein at Shanghae.) Our merchants have maintained — at least a large majority, and their opinion is supported by some interpreters of our Treaty, not of our nationality nor in any way connected with trade — that, by Treaty, the payment of the Tariff duty should protect our imports from all further taxation until passage of a barrier renders either the pay- ment of the transit dues, or production of a Customs certificate proving payment of the half-duty commutation, necessary. 1 agree. This region of exemption from all but Tariff duty, the region lying portwards of the transit duty barriers, I have so far claimed as the port area. But they have further maintained that, the claim for barrier transit dues once satisfied, the imports, having then paid both Tariff and half-Tariff duty (in other words, the 7^ per cent, which Lord Elgin thought ought to content the Chinese Government), should thereafter be free of all taxation whatsoever. T do not admit this. Why, I shall show farther on. 'Yhe view of the Board of Trade, as expressed after examination of the papers forwarded by Sir Eutherford Alcock during his negotiations of 1867-68-69, is unques- tionably more in accord with the contention of the Chinese Government than with that of the British community. I extract the following passages from the letter of Sir Louis Mallet, then Secretary to the Board of Trade, dated the 19th May, 1869, and published in the revision of Treaty papers laid before Parliament in 1871 : — " My Lords entertain no doubt that the view expressed in some of the memorials, and even at one time by Sir K. Alcock himself in his correspondence with Mr. Hart, viz., that the payment of the transit dues ought to be held to exempt the goods upon which it has been paid from all subsequent internal taxation, and to insure the sale of the goods to their ultimate consumer, with no enhancement of cost derived from taxation, save that represented by the import and transit duties, is a view which cannot be entertained by Her Majesty's Government. There is nothing in the terms of the Treaty which appears to my Lords to justify such a sweeping demand, and in view of the internal taxation to which native goods are subject in China, it would be, in their opinion, both unjust and inexpedient to enforce such a demand, even if it were warranted by the terms of Treaty stipulations. " All that Her Majesty's Government can claim in this respect appears to my Lords to be that in the Treaty ports,, the importer shaU have the right to sell his goods in the market after payment of the customs duties stipulated, and that he shall have the right to send goods to any internal market which he may select, free from any other charge than the customs duty on importation, and the stipulated transit duty ; but that both at the port and at the internal market, when once the goods have passed out of his hands, they must take their chance in common with native goods, and bear whatever impositions the rapacity or necessities of Chinese administration may inflict." This would leave the Chinese free to impose what taxes they pleased upon trade in imports, even within the port area. The conditions agreed to by Sir Eutherford Alcock, consequently, if observed by the Chinese Government, would have been far more advantageous than those that, in the Board of Trade's opinion, it would be iust ' n238l TT •' 48 to claim. Our merchants, however, did not believe that the Chinese Government would observe the essential conditions; that if the half-duty were paid down, their imports would have the run of the Treaty port provinces free of further taxation. One ot the foreign Ministers, Sir Eutherford Alcook's colleagues, declared his conviction to the same effect : that the payment in advance, of the half-duty, would be but so much added to the li-kin or other burdens which it was sought to hghten. Consistently with their theory, as above set forth, our merchants further contended that, in the provinces inland of the Treaty port provinces, the Chinese ought not to tax our imports carried into these under transit duty certificate, even when, by passing into consumption, they had become separated from the certificate. The counter-concessions obtained in other Articles of the Convention from the Chinese Government, it was argued, were not of sufficient value to justify the surrender of the area of exemption from all but Tariff duty (the port area), or of the option to use or decline the privilege of certification by payment of the half-duty. In the end the new Agreement was not ratified. My own disposition, when I read Sir Rutherford Alcock's Convention, in 1869, was, I confess, to doubt that, the half-duty paid, our imports would be any the more secure against such taxation as " the -rapacity or necessities of Chinese administration " might inflict upon them. I doubted the good faith of its ofiicials, where breach of faith could only be established by the evidence of those subject to their authority, and entirely in their power. I have since found reason to believe that the control of taxation in the provinces is a matter of no small trouble to the Central Government as at present constituted, if, indeed, it be possible at all. The State Papers, of which the sense is given in Appendices 2 and 3, prove this. But the Convention had hardly been rejected, untried, before it became apparent that its rejection had greatly added to our difficulties. It was the first instrument affecting British trade that had not been extorted from the Chinese by force of arms. It was the first in which there was at least a show of reciprocal interchange of concessions. It was the result of two years' negotiations, during which, in one or two instances, the Chinese had spontaneously adopted a course of action implying a more liberal interpretation of Treaty engagements. It was not wonderful, therefore, that its rejection without a trial should pique the high officer wlio had, in effect, represented the Chinese Government throughout the negotiations (the Grand Secretary W^nsiang) ; or that his pique should show itself in renewed obstructive- ness. Whether the forebodings of myself and others regarding its operativeness were well-founded or not, I have, almost from the day rejection of the Convention was made known to the Tsung-li Yam6n, found occasion to regret that it had not been allowed at least a term of probation. As it was, complaints of the unlawful detention or taxation of goods in transitu continued, and a concession of great value was practically withdrawn. I mean the right of certificating imports carried inland, no matter what the nationality of the holder. I speak of it as a concession, because our demand that tlie nationality of the goods, not of the owner, entitled them to clearance inwards by payment of half-duty had earlier been resisted. In 1868, however, the Tsung-li Yamen had by Circular intimated to the Provincial Governments that the transit duty clauses affecting imports were henceforth to be so construed. This action of the Yam^n was the more noteworthy because it was taken without communication with the foreign Legations. The Circular was not brought to my knowledge until after I had received complaints, in 1871, that the provision which it recognizes had been set at nought. I pressed for enforcement of its injunctions, but without effect. I was always met with the old argument that the Chinese Government had the right to tax any property held by Chinese subjects. This principle had been violated, said the Grand Secretary W^nsiang, when I represented that the Circular of the Yamen, in reality, surrendered it, violated by the issue of that Circular, and its prescriptions, he said, had been generally declared by the Provincial Governments impracticable. He refused me a copy of it. It is scarcely needful here to notice in detail a negotiation on the subject of transit duties undertaken in concert with some of my colleagues in the year 1871-72. It resulted in a draft of rules proposed by the Tsung-li Yamfen, which were accepted by none of us, and remonstrance was continued as before, I imagine by all, certainly by myself, as occasion required. I have mentioned in the earlier portion of this Report the circumstances under which I thought it my duty more formally to reopen the discussion with the Tsung-li Yamen in 1874-75. The statements of fact, which have run to such a length, were a necessary preliminary to my arguments in favour of the modification of Treaty right which I have agreed to recommend to Her Majesty's Government, in consideration of certain counter-concessions. I must first re-state my own construction of our right. I believe that by the Treaty 49 of Tien-tsin (1868) our imports, opium excepted, should be free to be sold on payment of Tariff, without imposition of other taxation, until they are sent for sale to an inland, centre past the barrier or barriers between the port of entry and the inland centre in question. To pass these barriers free of other dues, they must be accompanied by a certificate proving that, in lieu of the dues leviable in transitu, the lialf-duty composition has been paid upon them. Without this certificate they must pay what dues may be demanded. On arrival at the inland centre, when they pass into consumption, I hold them liable to local taxation. I am here at issue with many of my countrymen, as well as with others whose opinion I am bound to respect, who maintain that, the half-duty paid, no taxation should be leviable at an inland centre. I maintain that its levy is just, and for this reason, that the imports can only claim exemption from it so long as they are accompanied by the certificate attesting payment of the half-duty composition, which payment it is at the option of the importer to make or to decline making. Where he finds, as may be sometimes the case, that the transit duties amount to less than the half-Tariff duty, he will, of course, decline it. But as he has this right of option, the Chinese Government, it seems to me, cannot be denied the right to infer, whenever goods are found without a certificate, that the importer has elected not to pay the half-duty. At the inland centre, it has been suggested, a system of sub -certification might be established. Such a system would, I think, involve a more costly establishment (for it must be in the nature of a foreign Inspectorate, that is, of a highly-paid staff) than it would be fair on our part to require, and such an establishment could not undertake to protect more than the larger operations in imports. Certificates could hardly follow goods consumed in the retail trade inland. As the Treaty now stands, however, I concede the right of the Chinese to tax imports inland, once they are separated, by lawful sale, from their transit duty certificate. But the question earlier put remains unanswered. At what point does the liability of imports to taxation in transitu begin ? What are the limits of the port area ; the area of exemption from other taxation to which the imports are entitled upon payment of Tariff duty? As the validity of the Treaty of. Nanking (1842) was reaffirmed by the Treaty of Tien-tsin (1858), and as the Declaration of 1843 (in which it was agreed that the charges to be levied as transit duties were never to be raised) was signed as possessing equal value with the Treaty of Nanking, I have been wont to contend that the barriers at which the liability to transit duties commenced could only be those existing in 1843, at which the moderate charges never to be raised were then levied. But the severity of a condition so sweeping apart, I am compelled at the same time to admit that if my- hypothesis of right be unassailable, it still advances me but little towards practical solution of the difficulty before me, for the simple reason that I cannot myself, nor do I know any one that can, affirm what barriers existed in the year 1843. Of the more modern date of some I am satisfied ; but I am unable to say positively of others that they have not the right of taxation which I admit a certain seniority would give them. I have been unable, consequently, even at ShanghaO;, to define my port area to my own satisfaction, and at some of the other ports the definition of the area would present even greater difficulties ; eminently at Canton and Foochow, where there lies between the foreign settlement and the country inland a large city and suburb, in which I think it certain that octroi barriers existed long before 1842. The Chinese, however, have in general ignored the port area. In general, not always. That is to say, that where the country inland, from its formation or its poverty, would render the establishment of li-kin collectorates near the port inconvenient, they have not been established. Otherwise, at Shanghae, for instance, collectorates have been established close to the foreigners' dwelhngs, and li-kin taxation has been laid through these, not alone upon opium, on which, as T contend, the Chinese have a right to lay it, but upon all «)tber British imports ; and when my Agreement was signed at Chefoo last September, a bale of shirtings was as certainly taxed at Shanghae the moment it left the foreign importer's door as a chest or less quantity of opium. The bale of shirtings could not be sold by the Chinese purchaser in the city of which the foreign settlement is the suburb, without payment of a certain charge as li-kin, which made it free of but a limited district. Passing out of this, it paid the li-kin charges that freed it in a second district, and so on. The authorities, as a rule, have evaded com- munication of the K-kin tariff when applied to for it. Our information (see Appendix No. 1) comes from the native constituents of our merchants, whom we cannot put in the witness-box. ■ The charges in these li-kin districts are not stated, each taken by itself, to be very burdensome. At Shanghae, up to a certain distance from the settlement, they do not 50 in the aggregate amount to the half-transit duty. Where they do, the purchaser or the importer covers them naturally by a transit duty certificate ; that is, if he have taith that the certificate will be respected, which at some centres not very far from Shanghae it has not been. Eefusal to recognize these certificates constitutes a distinct breach of Treaty ; but of this I do not propose here to say more. What has to be borne in mmd is this, that whether the li-kin charges levied in the settlement, or in the country port- wards of barriers immediately beyond it, be onerous or light, there is more than a strong presumption that, under 1'reaty, they ought not to be levied at all; that the Tariff duty should clear all imports, opium excepted, until they reach the barrier, to pass which, free of other taxation, they must be covered by the half-duty certificate. My complaint has been that no distinction is admitted at Shanghae between opium and other imports. With no port area defined there has arisen (I am still speaking simply of Shanghae) another complication. To insure the levy of the li-kin the collectorate of course has had to maintain an executive, and in more instances than one this executive, when attempting the arrest of Chinese alleged to be evading the li-kin, has come into collision with the foreign police of the resident community. The collisions I refer to were more notably in the case of opium, for which, once more, T do not claim the benefit of a port area ; but the action of the li-kin collectorate, as I have said above, has extended equally to all other imports bought in the settlement ; all the com- modities, in short, for which I do claim the benefit of a port area. The right to .any port area whatever being practically ignored, I have come face to face with the necessity of defining the area to which I conceive we are entitled. With the full conviction that we are entitled to some area, I found, as I have indicated, an exceeding difficulty in the way of making any definition that I could declare to be exact. It is possible that this difficulty might have been surmounted had I been able to count upon the cordial assistance of the Chinese Government, Central and Provincial. I purposely distinguish the one from the other. But I certainly could. not count in a question of the kind on the cordial assistance of either. The needs of both, needs that we recognize as lawful besides other needs, and the convictions of both, are against any measure that will withdraw any commodity from the net of li-kin taxation. However, let us suppose the Central Government, with which the Tsung-li Yamen, the Chinese Foreign Office, is undoubtedly identical, — let us suppose the Central Government so convinced or intimidated as to declare itself willing to go the length of conceding, as a port area, either the country within a fixed distance, at a radius of so many miles ; the area, that is, proposed in 1869 by Sir Eutherford Alcock; or the. country lying portward of the barriers proved to have existed before 1843 ; the area claimed by myself. The latter, as I have intimated, would be at some ports far less than at others ; less, for instance, at Foochow than at Shanghae, while at Tien-tsin it is probably far greater than at the latter port. In most cases, however, it might he a tract of con- siderable dimensions. Suppose, I say, that the Central Government had circulated instructions to the Provincial Governments to exempt foreign imports from li-kin taxation within an area so agreed to, would such instructions have been given effect to in the provinces ? The papers annexed (Appendices 2 and 3) will go far to prove that they would not. The Memorials to the Throne and the Imperial Decrees there referred to do not, it will be seen, address themselves exclusively to foreign trade. I am not sure that they have all appeared in the "Peking Gazette." They were certainly not specially intended for the foreigner's edification. They embodj' in various forms a complaint, which in my experience is not new, to wit, that neither as regards opium or any other commodity on which li-kin or other abnormal taxation may be laid, is the Central Government kept duly informed ; that much of the revenue collected is not remitted ; that instructions to send up Eeturns to Peking are utterly disregarded by the Provincial Governments, who have their own reasons for winking at the dishonesty of the sub-collectors of li-kin in their respective jurisdictions. I have no expectation, until the Empire is governed with far greater vigour than at present, that this state of things will improve. Its administration in most of its depart- ments, and certainly not least in its finance, will for long continue to a certain extent matter of compromise between the Central Government and the Provincial. I have heard it argued in China that the ability of the Central Government to control provincial exactions is^ proved by the fact that in the Convention of Sir Rutherford Alcock it engaged to control them ; entirely to exempt our imports in the Treaty port provinces from li-kin or any other form of taxation, if we would pay down the composition half-duty with the full Tariff" duty. I repeat that I think it much to be regretted that we did not test the value of this stipulation.. If it was given eflfect to, we were gainers 51 If it was violated, we were the stronger for remonstrance, or, failing justice, for reprisal. But that it would have been observed I thought in 1869, and still think, doubtful. The li-kin or other abnormal impost, be it remembered, is not laid upon our import trade alone. Our imports form but a small portion of the trade abnormally taxed. The tax is laid, in different degrees, upon almost every article in circulation. It is, for the present, indispensable to China. When it ceases to be so. we may rely upon it that li-kin collectorates will not be kept up for the taxation of foreign trade alone. It would not pay to keep them up. But so long as they are kept up for the taxation of the general trade of the country it is to the last degree improbable that foreign trade will escape li-kin, except within such limits as can be efficiently watched by a foreign Consul or like agent. Beyond his ken the li-kin collectorates will too probably levy li-kin upon our imports, the only evidence to the fact being that of the Chinese merchant who has to pay it, and who it is vain to expect will appear, in support ol' our reclamations, as a witness against his own authorities. We have felt this embarrassment even when imports are travelling inland protected by transit-duty certificates and along the greater lines of traffic. We must be a fortiori prepared for it in places less prominently in evidence. Lastly, when our fight as against, li-kin has been well fought, our flunk may always be turned by a change in the form or style of exaction. Districts, guilds, corporations may be called upon to pay a charge upon their operations which would tell, not exclusively, nor perhaps directly, but still would tell upon our import trade, though -they might be unassailable under the provisions of the Treaties. While this Eeport has been in process of preparation, news has been received of the imposition of a tax upon native vessels on the Yang-tzu Eiver, to be levied only when no duty can be levied on their freight. The revival of some of the inland barriers which existed before the outbreak of the Tai P'ing insurrection (1853) is also said to be in contemplation. Well then, to come at last to what I have recommended ; believing conscientiously that a weight is laid upon our import trade from which by Treaty it should be exempt ; unable to declare to my own satisfaction the precise limits of the area within which our import trade can claim exemption Irom the weight complained of ; doubting exceedingly that, if an area of the dimension which I believe we might legally claim were conceded, our imports would be exempted from taxation over any larger portion of it than we could conveniently watch, I have agreed (Section 3, Article I), if the Government of China consented to relieve the weight upon our trade by conceding certain measures that would conduce to its expansion, to move Her Majesty's Government not to press our claim to exemption from li-kin except within a limited area, the surveillance of which is perfectly within our reach. I did not arrive at this decision without long and careful deliberation. Mr. Hart, who was present when the arrangement was last discussed, advocated strongly the prescription of such an area as was proposed in 1869, a circle of which the circumference should bfe a given number of miles from the custom-house as a centre. The Grand Secretary Li was opposed to this ; but I confess that I did not warmly support the proposition. I should feel no security against squabbles about the levy of li-kin within or without a boundary-line several miles in extent that was not so defined by hills, streams, or other features of the ground, as to put the limits of the area within them beyond dispute. While I write, it is telegraphed from Hong Kong that the Chinese Government is prepared to deal more liberally with the port area question than my stipulations provide. I shall rejoice, of course, in any measure by which~ British interests are advantaged, even if it leaves my late efforts in the shade; but I adhere to my conviction that, so long as li-kin taxation is a recognized necessity of the Empire, it will be wiser to accept an expansion of our trade than to continue to press for a right of exemption that we shall have great difficulty in defining, and of which, could we make sure of a definition of it, we can never assure ourselves for certain of the exercise. Beyond this, the exchange of concessions which form the matter of Articles I and VI of this, the commercial section of the Agreement, there is scarcely anything in it that, but for the circumstances that brought about negotiation of that instrument, might not have been arranged with less solemnity. For the delimitation of the foreign settlement area proposed in Article II is but a pendant to the provisions of Article I. On opium, as I believe I can show, Article III but secures to the Chinese Government what it is entitled to. In Article IV, it but confirms to us rights of which, though m.ore than once disputed, the existence under Treaty has been long maintained by us. In Article V we concede a term for the expiry of drawback which is but fair to both parties. By Article VII a 52 Coiiimission of Inquiry is agreed to that may examine the interference of Chinese cruizers with the junk trade of the Colony of Hong Kong, with a view to the due protection of the lawful interests of hoth the Colony and the Chinese Government. The concessions made by China will prove, in my belief, of great advantage to China. But it must be remembered that this has never been found to be an argument of any value in discussions arising out of foreign trade. On the other hand, I regard them as of considerable significance to our import trade, that in opium included. T'our ports are opened, two up the Great Eiver and two upon the sea coast, at which British subjects may reside. Six other ports are opened up the Great River, not for residence, but as ports of call for steamers. At Chung-king, the great mart of Western China, we are authorized to place a Consular Agent to protect our trade. Whenever steamers reach Chung-king, we are authorized to reside there. These concessions, I say, are advantageous to China. They will incontestably augment her revenue. The benefit, materially, they confer upon us is in the increased opportunity they provide for the distribution of our imports. We insure at four points delivery of our goods for Tariff duty, and at six other points, not heretofore accessible except in Chinese junks, delivery, but from British vessels, as at an inland centre ; that is to say, for the additional half-duty that enables us to certificate our imports. Morally, I believe that they benefit us no less. Of the political importance of multiplying points of contact, as a guarantee of better relations, I have spoken sufficiently often. In the exchange I have recommended to Her Majesty's Government, that guarantee is strengthened by the diminution of causes of dispute, of which the collection of abnormal taxation is one of the most fertile. There is an apparent conflict between the arrangement stipulated in Article I and that in Article VI. My original list of new ports included other places, notably To-chou, in Hu Nan ; Ta-ku Shan, in Manchuria, the outport of a coal-field of value; and Shui-t'ung, on the west coast of Kuang Tung. I abandoned the two last because at neither, in the opinion of Mr. Hart, would a Customs agency prove remunerative. I had not been forgetful of the fact that undue extension of our Consular establish- ment would be unacceptable at home. So long as exterritoriality is a necessity, I am myself opposed to the congregation of British subjects at ports or places at v^^hich there is no British authority, or even to the opening of ports so circumstanced to our shipping. We are responsible as much for the control of our countrymen as for their protection. And, as I have observed under Section 2, there are many reasons why, in my opinion, the foreign Customs, a cosmopolitan service, could not advantageously be invested with such powers as would enable them to discharge the duties now discharged by Consuls, British or of other nationality, the office of general control, in fact. But I should not hesitate to entrust them with power to retain a ship's papers vphile she was in port, and, in the event of a dispute, pending reference to the Consul of her nation ; and an arrangement of the kind at subsidiary ports would have much to recommend it. Where, on the other hand, the trade of a port was declared, by competent authority, to be unequal to the support of a foreign Customs establishment, there would be a double reason for not insisting on the access of our shipping to it. I abandoned Ta-ku Shan and Shui-t'ung accordingly. Regarding Yo-chou I was more tenacious. It is a centre of much importance, and the first argument urged against it, that it is riot, properly speaking, upon the Great Eiver, was of no great force. It was not until the last moment, therefore, that I surrendered it, and then under the following conditions. For the reasons earlier given I was myself desirous of definitively closing the case. A similar desire having been more than once manifested upon the other side, I undertook to accept the responsibility of declaring the case closed, provided that, in addition to all other stipulations enumerated, the Grand Secretary Li would consent to the immediate opening of the new ports and places of call specified in the Agreement, instead of leaving this step dependent on the understanding to be arrived at on the subject of port areas and the collection of inland duty on opium. The Grand Secretary showed a fair disposition to meet me half way ; bnt he would still have postponed the opening of the ports for a twelvemonth from the receipt of the Imperial Decree for which I had stipulated, approving the Agreement we were about to sign. I pressed for six months, and the Grand Secretai7 finally consented, provided that I would withdraw Yo-ch-ou from my list. On these terms I withdrew Yo-chou. At Chung-king we shall neither reside nor deliver goods in foreign bottoriis until steamers can reach the port. My impression is strong that, the rapids notwithstanding steamers will eventually reach Chung-king. Whether this hope, which I base on the information I have received, be justified or not, another object which I had more 53 immediately in view will be answered by the residence of an agent in the city. It is the port of destination to which large consignments of our imports are addi'essed. They are frequently, though covered by transit-duty certificates, detained en route by the li-kin coUectorates, it may be those in the jurisdiction of Ssii Ch'uan, the province in which Chung-king stands, or in that of Hu Pei, through which they have to pass en roM^e westv/ards. I had but recently a two years' debate over a claim. on account of such detention, amounting to upwards of 21,000 taels. This was one of a series of cases defended on the not unusual ground that the goods detained were Chinese owned. It was aggravated by ill-treatment of the crews of the junks carrying the goods which again was excused by the common allegation that these had misrepresented facts. The Tsung-li Tam6n, after long debate admitting that wrong had been done, sent down instructions to release the goods. These were not at first obeyed. The goods being at last released, the justice of the claim for indemnity was also in due time admitted ; at least it was referred to the collectorate concerned. Then followed a discussion^ as to which government, that of Hu Pei or that of Ssu. Ch'uan, was responsible. In the end, the British merchant interested was approached personally by the official sent down to Hankow from the- collectorate to settle the matter ; and the matter was then privately settled, I must add to my regret, by payment of something over one-half of the claim, the claimant preferring what he could make sure of down to awaiting the issue of further negotiation on the subject. The above is a sample of an order of proceeding unhappily not at all without pre- cedent ; even at the ports parallel cases could be quoted. But the presence of the Consul is a certain check upon irregiilarity, and an agent at Chung-king — other advan- tages apart that are derivable from his presence there — will, I trust, do much to control it in the Upper Valley of the Great Eiver. So far as the import trade is concerned, I look upon our newly-acquired position at Chung-king as one of the most important of the concessions made. Independently of the better security it provides against discussions which are never otherwise than unpleasant, it- insures an improved distribution of our manufactures at a mart of trade which is to the west what Hankow is to the centre of China. Lastly, it is a point of contact with a large and substantial native community. The opening of the subsidiary river ports enumerated in Article I, to foreign shipping, was the subject of much discussion. It was finally agreed that they should be opened as calling-places for steamers. There will thus be at these neither resident community nor Consular establishment. The access conceded to steamers excepted, trade at these ports of call will be con- ducted as it would at an inland centre. Steamers may land or ship passengers or goods, but by means of native boats only, and subject "to the regulations in force affecting native trade ; that is to say, that the goods they land or ship will be liable to li-kin or other abnormal taxation, just as they would if they were carried in native bottoms, unless pro- tected by a transit-duty certificate. This protection, of course under Treaty, should equally avail them in native bottoms ; otherwise, the only difference between the native craft and the steamer at these places is, that the latter may not land export produce for sale. It may carry it from the market at which it is purchased to a stated port for exportation, but may not dispose of it in transitu ; that is to say, certificated produce shipped in the steamer is under the same conditions as certificated produce brought by canals or otherwise from an inland market. The boon is the right acquired- by our steamers to frequent these places ; the consequent increase of facility for trade, and the multiplication of points of contact — a chief source of hope for the future. The provision in Article II for the definition of a settlement area where none, has been previously defined I have said is but a pendant to- the provision of Article I, that Her Majesty's Government should be recommended to allow the so-called Concession at the different ports to be regarded as the area of exemption from li-kin. The term concession, first adopted at Shanghae, is more or less a misnomer. It is applied, at some ports, as at Tien-tsin for instance, to the tracts of ground which, at the instance of the agents of various Governments, have been marked off as the ground within which their nationals may purchase building sites of the Chinese proprietors. At some ports, as, for instance, at Amoy, ground has either never been marked off at all, or if marked off has been left unoccupied because it was unsuitable. But at no point has the foreign community, of late years, been restricted to a particular pilot of ground, be the tenure what it might. The acquisition of such particular plots is for many reasons useful, especially at a new port ; but the words, "or at other places," were introduced into Article XI of the Treaty of 1858, which provides for the acquisition of building sites at the open ports, for the express .purpose of enabling British subjects, 54 where the ground originally marked off became overcrowded, or where other necessities presented themselves, to acquire sites within a moderate distance of the centre more precisely designated by the word port. At Shanghae, for mstance, they were intended to include Woosung ; at Canton, Whampoa. So elsewhere, and, practically, foreigners do reside, as of 'J^reaty right, almost everywhere they please m the neigh- bourhood of the ports. , . . n i These areas, the so-called concessions, may be nominally distinguished as_ con- cessions of the nation by whose agents their appropriation to foreign use was originally secured, but they are in no case exclusively devoted to the use of any one particular nationality. Our own rule in these concessions, when leased to our G-overnment, has been to allow lots of land within them to be held by any foreigner whose Represen- tative would guarantee his national's conforniity to the regulations already binding upon British subjects holdinglots in the concession concerned. Whether in concessions leased as above to foreign Grovcrnments, or in concessions recognized as such under other conditions, the conservancy of the settlements thereon formed is cared for by a Committee of the foreigners residing at the port. Its members, of course, possess no magisterial authority ; this is the property of the Consuls only ; but, from the nature of their functions in respect of taxation, maintenance of police, and the like, the Committee is not inappropriately styled a Municipal Council. To give effect to the stipulation of Article I, that the ground so held by foreigners should be regarded as the area within which imports were to be exempt from li-kin, I was, of course, bound to recommend also a delimitation of that ground. It was the more necessary on account of the peculiar position of the opium trade, whether under the new rule of taxation recommended by me, or under the rule heretofore prevailing against action under which I had also received complaints. The position of the opium trade is peculiar in this, that it is by Treaty liable to an inland taxation, to which other British imports are not liable. Interpreting the Treaty as I interpret it, I differ with the complainants to whom I refer. They claim, at least, the benefit of a port area for the drug. I contend that its liability to inland taxation commences from the moment that it passes out of the hands of the importer. The right claimed for it to a port area, as might be expected, has besides brought us, in some instances, into collision with the executive of the li-kin collectorates. I should wish, before going further, to submit to your Lordship some observations regarding impressions, to my mind erroneous, on the subject of the opium trade, as likely to be affected by my Agreement. I have been complimented by some, whose objection to the trade is so strong that they would suppress it at any cost, upon the great step secured towards its suppression by Article III. Importers of opium have so far shared this estimate of my work as to express their apprehension that tbe trade in it will be hard hit by my stipulations. It has been argued that, as a natural consequence, they may seriously prejudice the opium revenue of the Indian Government. As regards the first of tliese three propositions, I am obliged in candour to decline the praise awarded me. More; although I should be as well pleased to see the Chinese, for their own sakes. abandon the use of opium, or, at least, the excessive use of it, as I should be to see drunkenness reformed out of our own islands, I am bound to admit that in my late negotiations I did not propose to myself the part of a moral reformer. As to the allegation that for a habit which has undoubtedly been developed to a vicious excess the Chinese were originally indebted to the Britisli importer of Indian opium, I have a suspicion that (he contrary might be established. Even in 1839, when, if tlie Chinese Government had condescended to treat us as a Government, the exclusion of the drug from the ports of China might possibly have been negotiated ; for the belief that the Empire Avas opposed to its admission on moral grounds could not have failed to have had its weight with our own Administration ; even then, in 1839, I am persuaded that the Indian opium imported, though undoubtedly the opium most in request was but a small proportion of the drug consumed in China. Opposed on moral grounds, the trade undoubtedly was ; by the Emperor reigning and by some Ministers, perfectly in earnest ; but the outflow of silver it was alleged to occasion was for no little in the opposition of others ; and there was in both and all beside a feeling of contempt and hatred of the barbarian, of-which their attitude in the opium discussion was not the only evidence. But to return to our responsibility as purveyors. I doubt that at any time we have imported sufficient opium to supply 6 per cent, of the population of China. From inquiries which I prosecuted with some intenseness in the years 1846-49, less than ten years, that is to say, from the date of our first rupture, I found that the poppy was cultivated in at least ten of the eighteen provinces of China. In Kuang Si this cultivation and the preparation of the drug, even in 1847, were not a new-grown business. The rice crop, I was assured, in some parts of the province, was sacrificed to the poppy. In the south of Fuh Kien a white poppy was grown, the opium manufactured from whick was cheap, but exceedingly deleterious. In the far north-west, at Lan-chou Eu, an opium was manufactured which was credited with the nearest approach ia excellence to our own. The Provinces of Ssu Ch'uan, Hu Pei, and Hu !N"an produced their own opium ; and when, in 1858, I accompanied Lord Elgin to Hankow, in Hu Pei, I remarked that although the native drug from these and from the Provinces of Kuang Tung and Kuang Si was advertised outside the smoking divans as openly as our public-houses advertise the liquors we drink, there was not to be seen in any street that I traversed a single notice that foreign opium was for sale. At this moment I doubt extremely whether even in the inland districts of the coast provinces the opium consumed is foreign. From the Reports recently printed of those members of the Consular Service who have been sent into the interior to ascertain whether the Pro- clamation on the Yiin Nan outrage has been duly posted, I incline to think that it is not. In the far west provinces, in Yiin ISTan, for instance, it certainly is not. Yiin Kan, it has been supposed, drew opium from British Bin-mah. It appears, on the contrary, that Burmah proper, at all events, is supplied from Yiin Nan. The evil of opium- smoking in China I do not contest. I do not abate it by a parallel between it and the abuse of spirits even amongst hard-drinking nations. The smoker to whom his pipe has become a periodical requirement is more or less on a par with the dram-drinker ; but the Chinese constitution, moral or physical, appears to me to be more insidiously invaded in the case of the first. The confirmed smoker is not, or is seldom, at all events, outwardly committed, like the drunkard, to indecorum. The indulgence appears, at the same time, to present a special attraction to the Chinese as compared with other peoples. The use of it, in my experience, has become more general in the class above that in earlier times addicted to it. Much, however, as I deplore this state of things, I say again that when I proposed at Chefoo to recommend a change in the method of taxing it, I had, I confess, no thought whatever of assisting the Chinese Government to extinguish the trade in Indian opium. I was dealing only with the rights of China in respect of the revenue derivable from opium, that question being part of the larger revenue question which I was seeking to regulate in a manner practical and equitable. The extinction of our trade in opium, or at least its diminution, may come to pass from the fact that the poppy is being increasingly cultivated all over China. In some districts, as I have said, the drug to a certain extent rivals that we import. It is as likely that, with improved tillage and preparation, the native product will one day conapete with oyrs, as that certain of our Indian teas, under like conditions, will exclude certain teas of China from the market. And it is from this direction that the Govern- ment of India should look for danger. It has possibly no more than a limited lease of its present monopoly. But its total withdrawal from the trade at this moment, while it would involve the sacrifice of a considerable revenue, would not, I am confident, one whit advance the object which advocates of that measure have at heart, the emancipation of the Chinese from a habit which they too often fatally abuse. "Were our Indian quota to be withheld to-morrow, the Chinese would still persist in smoking opium, and their own supply, though inferior in quality, would be none the less equal to the demand. On the side of the Chinese Government there is no little cofltradiction between what is said and what is done in relation to this question. Chinese statesmen will tell one that opium is undoubtedly the greatest curse of the country, and that we, the English, are responsible for it. This is a convenient weapon of attack, not only in the hands of the Chinese. Some of them will more than hint at the danger to which our Indian revenue is exposed by Chinese competition. Some will suggest, speculatively, that this competition should be encouraged until imported opium can find no market. This point attained, they would then put down the use of opium in China with the strong hand, and remoralize the country. It is consistent with the views professed by these latter, that where they are in office they should make no effort to restrain cultivation. But it is rare to find any effort made anywhere. At Nanking, the present Governor-General did recently shut up the opium divans, thus compelling those who smoked to smoke in private ; but the poppy is grown in every part of the Empire, and the native drug is as regularly subjected to U-kin and other taxation as any other article of trade. In the negotiations of 18G8-69, it was suggested that if the Tariff duty on Indian opium were raised, the cultivation of the poppy in China might be restricted. This n238l T 56 in my opinion, supposes a unity of purpose and action in the administration which it will be long before it can lay claim to. On the other hand, the Government, both central and provincial, does value highly the revenue that it derives both under Tariff and by inland taxation from foreign opium. In 1875 the total of import duties collected, under Tariff, was 3,904,439 taels. Of this foreign opium paid over 1,888,000 taels, pr nearly one-half. But as a costly necessary, perhaps the only import that is a necessary, it stands without flinching a heavy burden of taxation in addition to Tariff, and the provincial G-overnments interested have of late years shoAvn a desire not so to weight it as to drive the trade entirely into the hands of the smuggler. I say of late years, for,, when Lord Elgin's Treaty was first on trial, opium was less intelligently dealt with, and the smuggler and the subordinate official benefited accordingly. Even now opium smuggling is not utterly extinct, although the preventive service is more effective than formerly, and the trade is taxed, in my opinion, with greater discernment. The rate of taxation in some instances ]ises, but not, I think, beyond what the locality will bear. The Tariff duty is 30 taels per picul. At Tien-tsin, Chefoo, and Newchwang, the three northern ports, it pays in addition 18 taels li-kin. Three years ago, at Chefoo, it paid but 12 taels li-kin, and the rate was probably the same at the other two ports, the foreign commerce of wliich belong to the same native superinten- deney. At Shanghae it pays 40 taels li-kin ; at Poochow 80 taels ; but at that port, some time since, it was stated to pay as much as 130 taels. In the earlier negotiations of 1876, I had at one time myself proposed that the opium li-liin tax should be equalized at all ports ; and at Chefoo I was invited to consent first to a uniform rate of 90 taels, which I declined, and subsequently to 90 taels, as a maximum limit at the southern, and 50 taels at the three northern ports. This would have been a considerable advance upon the rates now ruling, and would have added very largely to the Customs revenue. The Grand Secretary Li did not allow that this consideration influenced him in the proposition. The Chinese Government, he said, would not be sorry to see an increase of li-hin act prohibitively against the import of foreign opium. Whether, if the total to which li-kin at these increased rates would amount could be collected on the opium trade in a lump sum, such a tax would so act, I do not feel sure. Mr. Hart was strongly of opinion that the trade would bear the uniform rate of 90 taels li-kin everywhere. So great an increase of taxation, suddenly imposed, however, would not fail very seriously to interfere with the foreign opium trade at the poorer ports, and where it did so with other branches of foreign trade. Accordingly, I declined to give the encouragement of a stipulation to the proposition suddenly and extensively to increase the rate of li-kin. The Chinese have the right, which they exercise, to impose upon opium what li-kin the authorities of particular localities think expedient. I have preferred to leave the question in this j)osition, conceding, however, recommenda- tion of a new arrangement for the collection of the li-kin levied upon opium, which, while it secures to tlie Chinese Government revenue that I conceive it entitled to, avoids any possibility of collision between the executive of the li-kin collectorates and the gwasi-municipal police in charge of port settlements : an evil to which I have earlier referred. The stipulation in Article VII, that a Mixed Commission shall consider the estab- lishment of some system that may enable the Chinese Government to protect its revenue without prejudice to the interests of Hong Kong, points more or less in the same direction. There are rights on both sides to be protected, and a clash between the powers exercised on both sides to be averted. I bring in allusion to the Hong Kong question here, because opium has been so largely the cause. of the proceedings of which the Colony complains. But first, as regards the rights of the Chinese Government over opium at the ports. I have stated above (p. 106) the limits of the change that I conceive Lord Elgin contemplated effecting. I give below the exact words of his stipulation affecting it: — " Opium will henceforth pay 30 taels per picul duty. The importer will sell it only at the port. It will be carried into the interior by Chinese only, and only as Chinese property ; the foreign trader will not be allowed to accompany it. The provisions of Article IX of the Treaty of Tien-tsin, by which British subjects are authorized to proceed into the interior with passports to trade, will not extend to it, nor wiU those of Article XXVIII of the same Treaty, by which the transit dues are regulated; the transit dues on it will be arranged as the Chinese Government see fit ; nor in future revisions of the Tariff is the same rule of revision to be applied^ to opium as to other goods."— (Treaty of Tien-tsin : Tariff; Eule 5.) _ The words " the importer shall sell it only at the port," it has been contended, entitle opium to the benefit of a port area, and the exaction of li-Un from the native 57 purchaser within the settlement has heen (at Shanghae) protested against, nay more, '^^^^^ I cannot support this contention. I do not allow opium the same right of exenaption from taxation in excess of the Tariff duty. Remembering, as it^s impossible that i should forget, the position of the opium trade up to the time that the laritt above quoted was signed, I cannot read the rule otherwise than declarmg what I know to be Lord Elgin's intention regarding the trade. He would have it regularized, but he would .not protect it like the rest of our import trade. He was, in fact, opposed to its expansion. Had he contemplated a port area within which opium was to have been exempted trom taxation, he could have contemplated none but- the same as that claimed t?r JJ^^r imports, a district more or less considerable at every port, and the freedom ot whicii troni the surveillance of the li-kin or other like coUectorates would, from the portability ol the di-ug, have exposed the revenue leviable beyond the limits of any such district to enormous loss. For all other imports, as I have argued, we had a right under Ireaty to elaim the benefit of such an area, and our imports, opium of course excepted, it taxed within it, no matter in whose hands, were taxed in contravention of Treaty. This is the area limitation of which I have recommended that we should concede in exchange tor the increased facilities conceded by the Chinese. For opium 1 claim no area. An importer might, without breach of Treaty, open a divan for its consumption upon his own premises, but once it left his premises in native hands I do not admit that, as in the case of other imports, while within the port area, the Treaty would authorize us to come between the Government and the native purchaser. Considering, therefore, that the collection of li-kin on opium in the port area, whether the larger area to which by Treaty we ale entitled, or the more restricted area proposed by myself, is lawful, it follows that I admit the right of Chinese Government Agents- to collect it. But as the presence of the native executive employed to this end is, for many reasons, inconvenient, I would render the presence of *bat executive unnecessary, by transferring its functions to the foteign Customs Inspectorate, through whose hands, at this moment, all foreign opium, unless it be smuggled, must pass. The drug, when brought into port, is to be bonded until it is sold, and when sold the im|rt)rter is to pay the duty on it, and the purchaser the U-Un. By this very simple ali-tgCAgeMent, I cannot see that the revenue of India is to snffer. It will not cause an ounce less of Indian opium to be sold than at present. The importer's profits, to a certain extent, inay sufier. Where he has been able, as to a certain extent at some po^ts he has been able, to sell a proportion of his opium li-kin free, he will now not sell it tintil it shall have paid li-kifi. And this wotild apply even to * opium consumed on his premises, should he open a divan, because no opimn would be released from bond except on payment of the li-kin. But then I contend that li-kin, or other like tax, is duly leviable upon all opium brought into China. I have been asked whether the provincial Governments will not, under these circum- stances, be induced to impose a higher rate of li-kin upon opium than heretofore. In my opinion they will hot tax it beyond what it will bear. They really \Vant this revenue, and they now impose, unquestioned, whatever li-kin they believe the local market will endure. I do not see that the far greater security of collecting what they do impose, which its collectioii by the foreign Inspectorate will afibrd, should tempt them to suicidal taxation. Aiid I say this without forgetting that the dread of the competing smuggler may possibly be diminished by the efforts of the Commission provided fot in Article YII for the pl'otection of Chihese revenue without prejudice to the interests of Hong Kong. This brings me relevantly to the existing conflict between these interests, of which it will be the function of the Commission to devise an adjustment; a conflict, as I have implied, in whiteh the jrights of China to revenue on foreign opium are largely concerned. All other considerations apart, it is the satisfaction of these that I have felt it my duty, as an international agent, to keep steadily before me. I have shown, I think, why, without affecting to deprecate the moralist's censure of the abuse of opium-smoking in China, I decline to run tilt at the trade upon moral grounds. To recapitulate : its sudden 'cessation would entail upon the Government of India an enormuus loss, without, as I believe, any corresponding advantage to China. The Chinese will continue to smoke opiUna, I vnll hot say as the national' sedative (the latest euphemism), but as we us6 malt' and spirits, sonie fot good^ hiariy for evil, until such time as the use or abusS of stimulahta is controlled otherwise thfih by legislative pressure. They Avill continue to smoke Indian opium as long as opium-smoking prevails in China, provided always that Ihdian opium is tte Bfest they ciaiipr ochre. So long as [1238] I 2 58 this maintains its present superiority, the revenue derivable from it is in no way jeopardized. The drug will bear heavier taxation than that now imposed upon it, and heavier taxation will probably be laid upon it. But the Chinese have a right so to tax it, and my stipulation, while it adds nothing to the power of raising the rate of taxation already in their hands, secures to them the full amount of the tax that may be imposed. This is simple justice. But it is secured to them so far only at the ports. Their revenue still loses by the trade of Hong Kong, or, if it loses no longer, this is because they have resorted to a means of protection which, even were it applied without the smallest transgression of its lawful limits, must still be irksome, to say no more, to the Colony. Its lawful limits withal have not been unfrequently transgressed. The Chinese Government, having discovered that the Chinese junks trading with the Colony in many cases carry cargoes, whether of opium or other goods, imports or exports, /vhich by their trade with the Colony avoid payment of duties, has placed round the Colony, at certain points, upon Chinese ground, a cordon of native custom-houses, which overhaul every junk entering or leaving the waters of the Colony. This, if the executive Avent no farther, would oppress the junk trade of the Colony, the executive being, like the junkmen, Chinese ; but the right of the Chinese Government to inspect and tax its own junks could hardly be disputed.' The limits of the right are transgressed when the native cruizers pursue the junks into the ports or waters of the Colony. The punishment or prevention of action of the kind is, of course, within easy reach of a Power like our own. But the embarrassment of the junk trade would continue much the same unless the native custom-houses were so overawed by our exhibition of force as to desist from performance of their lawful duty, in which case we should be in the wrong. The revenue China is seeking to protect' is due to her. It is the interest of the Colony to render possible the discontinuance of these native custom- houses. It must not be forgotten that, when Hong Kong was ceded to us in 1842, we looked the responsibility imposed upon us by the close proximity of the island to the mainland fairly in the face ; and that, in the Supplementary Treaty signed by Sir Henry Pottinger at Hoo-Mun Chai in 1843, we agreed to co-operate with the Chinese Government in protecting it against the loss of revenue to which it would be exposed unless its junk trade were placed under surveillance. I quote below the provisions to which I refer : — "ARTICLE XIII. " All persons, whether natives of China or otherwise, who may wish to convey goods from any one of the five ports of Canton, Foochowfoo, Amoy, Ningpo, and Shanghae, to Hong Kong, for sale or con- sumption, shall be at full and perfect liberty to do so, on paying the duties on such goods, and obtaining « a pass or port-ctearance from the Chinese Custom-house at one of the said ports. Should natives of China wish to repair to Hong Kong to purchase goods, they shall have, free and full permission to do so ; and should they require a Chinese vessel to carry away their purchases, they must obtain a pass or port-clearance for her at the custom-house of the port whence the vessel may sail for Hong Kong. It is further settled that in all cases these passes are to be returned to the officers of the Chinese Govern- ment as soon as the trip for which they may be granted shall be completed. "ARTICLE XIV. " An English offtcer wiU be appointed at Hong Kong, one part of whose duty will be to examine the registers and passes of all Chinese vessels that may repair to that port to buy or sell goods ; and should such officer at any time find that any Chinese merchant-vessel has not a pass or reigister from one of the five ports, she is to be considered as an unauthorized or smuggling vessel, and is not to be allowed to trade, whilst a report of the circumstance is to be made to the Chinese authorities. By this arrangement it is to be hoped that piracy and illegal traffic will be effectually prevented. "ARTICLE XVL " It is agreed that the custom-house officers at the five ports shall make a monthly return to Canton of the passes granted to vessels proceeding to Hong Kong, together with the nature of their cargoes ; and a (Jopy of these returns will be embodied in one return and communicated once a-month to the proper English officer at Hong Kong. The said English officer will, on his part, make a similar return or communication to the Chinese authorities at Canton, showing the names of Chinese vessels arrived at Hong Kong, or departed from tliat port, with the nature of their cargoes ; and the Canton authorities will apprise the custom-houses at the five ports, in order that, by these arrange- ments and precautions, all clandestine and illegal trade, under the cover of passes, may be averted." The Supplementary Treaty was abrogated by Article I of the Treaty of Tien-tsin, together with the General Regulations of Trade appended to it, " the substance of their provisions," runs the clause, "having been incorporated in this (the new) Treaty." This is true of all the other provisions of those two instruments. They were, to quote the same Article, " amended and improved." No reference to the junk trade of Hong Kong was made in the new Treaty ; not, I am convinced, out of indiffeBeiice to 59 the interests or j-ights of the Chinese. Lord Elgin, the negotiator of the Treaty, felt so strongly upon this subject that he declined to stipulate for the participation of British shipping in the general cabotage of China. The surveillance of the junk trade of Hong Kong, so prescribed by Sir Henry Pottinger's Treaty of 1843, was left unnoticed, I imagine, simply because during the fifteen years that had elapsed since that Treaty was signed, the Chinese, whatever the cause, indifference or fear of trouble, had never mani- fested the smallest desire to give effect to any arrangement of the kind provided. One reason in the first part of the period in question was, perhaps, that the junk trade of the Colony was insignificant ; but from 1854, when Canton was for some months invested by T'ai P'ing rebels, it had continued to grow in importance. And in 1868 it was believed (by the Chinese) that revenue was suffering a loss of about 300,000 L a-year upon cargoes carried by junks frequenting Macao and Hong Kong, opium being, of course, the most valuable of the cargoes run into outports on the mainland. The Hoppo, or Chinese Superintendent of Customs, when complaining of this (I am unable, without reference, to say in what document), remarked that this evasion of duty along the west coast of the province was practicable only because at Hong Kong, which he speaks of as still belonging to the Province of Kwang Tung, " China has no custom- house, nor are persons stationed there for purposes of inspection ;" and he suggested that the Governor of Hong Kong should be directed by the British Minister to instruct the Consul at Hong Kong to put a stop to the smuggling of imports. I drew attention to this in 1868, in the Memorandum on Revision of Treaty before referred to. The Hoppo's confusion of ideas as to our territorial rights and the depart- ments of our services apart, I pointed out that his reasoning was not so absurd as at first sight it might be thought ; that the form of his protest but betrayed a belief, common to Chinese officials, that when British subjects were exterritorialized in China, the .British Government undertook to restrain them from wrong-doing. In this, oi course, he included the enabling or assisting the Chinese wrong-doer to do wrong.' la early days, before the first war, the native monopolists, known as the Co-Hong, not only collected the duties on the foreign trade, but controlled and were held responsible for all the proceedings of foreigners. When Consuls were appointed under our first Treaty, it was declared in Rule 15 of the Supplementary Regulations of 1843 that, whereas "it has hitherto been the custom when an English vessel entered the port of Canton that a Chinese hong merchant stood security for her, and all duties and charges to be paid through such security mez"chant, these security merchants being now done away with, it is understood that the British Consul will henceforth be security for all British ships entering any of the aforesaid five ports " — the five ports opened in 1842 to trade. This, no doubt, explains the Hoppo's construction of our official liability. The Instruments quoted have ceased to possess the force of a Treaty. Technically, the Chinese Government has no right to call on the Colony to co-operate with it in the protection of Chinese revenue. But I have thought it well to recall the fact that Me were at one time sensible of the justice of a claim to our co-operation. It has been made matter of complaint- that the attention of the Chinese Government was directed to the loss its revenue was sustaining by its foreign auxiliaries in the Inspectorate of Customs. If so, the Inspectorate, in my opinion, discharged a simple duty. The Chinese Superintendent of Customs (the Hoppo, as we call him), remarking that there was no authority to control irregular trade between Hong Kong and the Chinese coast, as he, whether ignorantly or impertinently, put it, "no Consul at Hong Kong," proceeded to control it himself. He, or the Canton Government, organized a fleet of steamers, and placed three custom-houses on three points of Chinese territory to overhaul all junks communicating with the Colony. I consider that the Canton Government herein exercised an undoubted right. The Government of China has an undoubted right, in my opinion, to see that Chinese junks carrying Chinese produce into Hong Kong have duly cleared from the Chinese port of export, and a right, equally good, to see that imports leaving Hong Kong pay what is due to the Chinese Govern- ment as import duty. The form of proceeding resorted to at these custom-houses undoubtedly distiesses the junk trade, and, through it, reflects an injury on colonial interests that gives the Colony some ground ot complaint. It is to the change in form of proceeding, therefore, that I have addressed myself; but as the Chinese right to adhere to the present form is complete, it appears to me that our only escape from its irksomeness is through the discovery of a means, to which the Chinese cannot object, of otherwise securing them their lawful revenue. The action of their executive is irksome in more ways than one. It is complained that their cruizers have in some cases pursued Chinese junks into our waters, and have 60 even effected captures within them. This, I hold, must be withstood, without com- promise. The jurisdiction of the Colony must not be invaded. It is complamed ttot their cruizers lie in the port of the Colony to watch the junk trade. I do not see that this is a sufficient ground for the exclusion of the cruizers in question. It is argued, that these cruizers are cruizers not of the Chinese Government, but of the Provincial Government, or eyen of the Superintendent of Customs, and that their estabhshment of officers, &c., is not duly commissioned. The form of written authority under which these cruizers act may not be that with which we provide officers and vessels similarly employed, but I consider them to be employed bond fide for the execution of a duty which the Chinese Government has as good a right to require of them as, on shore, to require a like duty of the foreign establishment that assists it in the collection of its revenue on foreign trade. In any case an intimation to the Chinese Government that, in order to secure these cruizers the consideration, formal or substantial, that is con- ceded to similar vessels elsewhere, it will be necessary that their status be regularised, would, I cannot doubt, immediately insure the introduction of such changes as would leave us no ground for objection under this head. The real matter of complaint is that the junk trade is "worried" by both qfuizers and custom-houses. The latter being exclusively Chinese, the dues or duties demanded of the junks are certain to be in excess of what is just ; at least, of my measure of what is just. By the Treaties between England and China, I think China entitled to argue that, if British imports are to have the benefit of the Tariff, they must be brought to one of the ports open by Treaty, and, if carried thence to other parts of China, must pay the half-duty composition for transit dues, or, if unaccompanied by the certificate attesting payment of this half-duty, must face whatever charges may be demanded upon them. I have been asked, " How if a Chinese, having purchased manufactures in England, were to carry them direct to some point of the coast to which British shipping have not by Treaty right of access ?" I say that in such a case the Chinese Government would be free, in my opinion, as the Treaty now stands, to make what law it pleased. It might suit it to enable its own subjects (by Treaty it could not enable the subjects of any other Power) to pay less duties than a British subject has to pay at the open ports, or more duties, or the same. The latter would be the more probable course, because it would prefer, I suspect, to keep the foreign import trade on the sea-board under the foreign Inspectorate. And it could not be held culpable or unfair if it placed our imports, brought as above by a Chinese from England, on the same footing as if they had come in a British bottom to a Treaty port. But if this vrere not unfair when they came from England, neither could it be so regarded, I think, if they came from a British Colony — Hong Kong, Singapore, or any other. The arrangement I desire is this : that the Chinese Government should consent to extinguish the three custom-houses that now keep watch round Hong Kong, and to substitute for these a branch of the Canton Inspectorate, to be located at some spot conveniently near the Colony ; to agree that at this branch office there should be levied the Tariff duty on imports proceeding in Chinese bottoms to a Treaty port, and the Tariff duty and half Tariff duty on imports proceeding to any point on the coast or up rivers not open by Treaty. On opium, which article cannot by Treaty be franked and certificated like other imports, the same office should be authorized, when levying the import duty, to levy the li-hin that would be levied were it sold at Canton. Every junk arriving at Hon o- Kong or leaving the harbour should be obliged to call at the office of the branch Inspectorate to receive a clearance, and the Colony should engage, so to assist in giving effect to this part of the arrangement, that disputes about limits of jurisdiction might be avoided. If it be urged that, when the duties have been collected by the branch Inspectorate the imports are not secured against an lul libitum levy of fees, &c., in addition when they reach their destination, I reply that I cannot, indeed, guarantee that the Chinese will not do whatever seems good to them where the foreigner has no agent to watch them. But we must remember that, before the junk trade of Hong Kong^was subjected to the surveillance now so obnoxious to the Colony, we did not hear of excessive levies of duty along the coast, and the contingency that excessive duties will be levied is certainly not increased by a measure that will largely add to the receipts of the provin- cial Treasury. Whatever it may be eventually determined to substitute for the system which the Colony finds so harassing, it is not to be expected that the junk trade of the Colony 61 can quite regain the position it held before that system was introduced. Chinese produce carried to the Colony will undoubtedly have to pay some duty. The imports, formerly run duty-free by the junks to the coast, will have to pay duty ; notably opium, an article of which the local monopoly is of no small importance. Part of the opium affected by the monopoly is of course consumed in Hong Kong, but part, certainly the the largest part, is carried away by junks. In either case I take it for granted that our imports, whether opium or other commodity, will undoubtedly fare better in the hands of the foreign Customs Inspectorate than if left to the mercy of the native regime. The native custom-houses, if they have a Tariff, are under no such supervision as will protect native jun&s against the exactions in excess of the Tariff". It is our interest to keep their hands off the trade, and especially off the trade in opium, collection of the duties on which was the first suggesting cause of their establishment. I commenced this long excursus in explanation of Articles II and III. I must still add a few words which could not have been brought in opportunely elsewhere. Although my agreement contains no stipulations on the subject, I beg to recommend that if a d:ecision be ultimately arrived at to require a larger area of exemption from li-kin than that proposed by me, such exemption be claimed by us only for. commodities that are beyond dispute constituents of foreign, as distinguished from native, trade. We are bound to seek every advantage for our manufactures, but we import some things that China produces, sugar, grain, and other raw material, which we shall suffer little by leaving to be treated as the Chinese treat their own produce of similar denomi- nations. I come now to Article IV of this section, the object of which was, on the one part, to secure a plain admission of the extent of our right to use the transit-duty certificate, whether to cover imports or produce destined for exportation; while, on the other part, it records an engagement to protect the Chinese Government against evasion of the revenue due to it upon produce in transitu not so destined, such evasion having been matter of complaint. Hu Pei, the province our imports traverse to reach Ssu Ch'uan has been in the habit of using a transit-duty certificate containing on the face of it certain restrictions. By the terms of this Article the Chinese Government agrees that the certificate shall be framed under one rule at all ports, and that, so far as imports are concerned, the nationality of the person possessing and carrying them is immaterial. We have long maintained that our imports, Tariff" paid and covered by a transit- duty certificate, are free of all charge in transit, no matter who the holder. But the Tsung-li Yamen, although, as I have mentioned before, its Circular to the Provincial Governments of 1868 admitted the Treaty right, did not communicate that Circular to the Legations, and withdrew from the admission made in it as soon as the Convention of • 1869 was rejected. It is something, indeed much, to have obtained a formal recognition of this right. I had similarly upheld our title to carry imports from a Treaty port to any point of the coast, if certificated, in a Chinese bottom ; but the claim Jiad always been contested. So, too, our title similarly to carry produce to a port. This is now formally conceded. Any available point of the coast is made as accessible for the above purposes as any point inland ; the Chinese Government having, of course, reserved to it the right to make arrangements for the prevention of abuses. These are such abuses as might be looked for equally at any inland centre. The abuse against which it is further agreed that rules shall be made to protect the revenue, where produce is carried under a transit-duty certificate, can only be controlled at the open ports. For the transport of produce purchased inland, if it be bon& fide intended for ship- ment to a foreign country, a British subject can, of course, claim a transit-duty certificate, and the half Tariff duty payment attested by this will clear the produce so certificated of all charges between the inland market and its stated port of destination. These charges, in some instances, amount to more than the half duty. Even where this is not the case, it is possible that a Chinese, carrying produce on his own account, will be called on to pay irregular fees that will swell the amount of these charges ; his goods being detained pending settlement. However little the transit-duty clauses are respected in some regions, and in some they are beyond doubt ignored, the certificate has been foimd, in some instances, of sufficient power to shield the goods certificated from overcharge or detention. The result has been that foreigners have been invited for a consideration', to lend their names to the Chinese carrier of produce, and he has been enabled, under the certificate taken out for him, to bring down produce, whether intended for exportation or not, free of all charges but the half duty paid by the foreio-ner 02 who took out the certificate. This vicarious application for certificates has been, in some instances, a regular business, and the Chinese have, in some instances, retaliated bj refusing- the issue of certificates altogether. The wiser remedy, we might have supposed, would have been the equalization ot the li-kin or other charges with the half duty payable for the transit certificate, and this measure, in one case, where the inland dues were below the half duty, was applied to the import trade. But the abnormal taxation of produce in transitu is a widely different affair from taxation of the import trade. The deficiency t^hat unauthorized certification may cause, quite apart, it also occasions a certain dislocation of the linancial machinery of the province. Be this good or bad, — I believe it to be exceed- ingly bad, and maintained, in general, as much from corrupt motive as from ignorance,— the. Chinese have a perfect right to persist in its maintenance, and, without criticism of the morality which is not shocked by the misrepresentation indispensable to abuse of his privilege by the foreigner concerned, I am satisfied that it is expedient that the abuse be corrected. As in all similar cases, it is exaggerated, but I had had evidence enough of its existence to justify spontaneous repetition of an offer to assist in its suppression. Our Treaty, be it remembered, leaves large powers in the hands of the Government, where shipment of produce is concerned. " Permission to export produce which cannot be proved to have paid its transit dues will be refused by the Customs until the transit dues shall have been paid " (Tariff 1858, Rule 7). But this is insufficient to prevent the tra.nsport of produce not intended for shipment, and, as such, having no claim to the benefit of the transit-duty charges. In discussing this grievance at the Tsung-li Yamen, I had long before signified my willingness to consider whatever rule on this subject Mr. Hart might propose, and before leaving Chefoo I requested him to let me have a draft rule that would meet the emergency. I append (Ai)pendix No. 4) the draft rule he communicated to me. I shall simply say of it that, while I entirely concurred in the principle laid down in Mr. Hart's foot-note, viz., that the object of the transit system is to enable native produce to pass from the native producer to the foreign purchaser for a foreign market on a payment of 7i per cent. (Tariff and half Tariff duty) to the revenue, and that that system is not intended to be used to exempt produce circulating in China from local taxation, I was in some doubt whether the periods within which failure to satisfy the conditions of the rule involved a heavy penalty were sufficiently extensive ; whether at the same time the penalties to which the applicant for a certificate who might fail to return it, or might fail to export his produce within the term specified, would adequately protect the Chinese Government. Mr. Hart, however, did not present it otherwise than as a memorandum of suggestions ; and a rule, which appears to be a modification of that , here referred to, is, I imderstand, now being discussed at Peking. A. proposition, which I believe has been under consideration at Peking, that foreign- owned native produce on its way to a port should pay all barrier dues and other taxes demanded on it in transitu, whatever is paid in excess of the half Tariff duty being refunded by the Custom-house at the port at which the produce is exported, if it proved operative, would, I think, satisfy every requirement of simplicity and justice. I say if it proved operative. The difficulty I apprehend is one which has on occasion been experi- enced where surcharge of dues was complained of. The barriers may refuse to give receipts for the sums levied, and the Customs at the port will then be without proof of the payment of the alleged surcharge. Could we count with certainty on the production of a receipt or other similar proof of such payments, we might cease to take out transit- duty certificates altogether, and claim all above the half duty as a drawback on exporta- tion. "VVe must on no account surrender the privilege of certification. This retained, I should be stro'jgly in favour of trying the arrangement proposed. Revision of our own Treaty, it must not be forgotten, may be claimed in 1879. In Article V I agreed that the three years should be the term within which a draw- back might be claimed on duty-paid imports. The Treaty prescribes no term. In 1859-60, the new Treaty having scarcely come into operation, Sir Frederick Bruce con- sented to limit the term at Shanghae to twelve months. In 1869, ^ir Rutherford Alcock agreed to a term of three years; but his Convention not having been ratified, disputes continued. In 1870-71, I caused inquiries to be made as to the extent of the term that might be accepted without disadvantage to trade. The answers I received generally led me to conclude that the term of three years might be safely adopted. I adopted it accordingly. I have, at the same time, to request indulgence for not having stipulated that its adoption should be subject to the approval of Her Majesty's Government. As the text now stands, the new arrangement was unconditionally agreed to. 63 1 proposed that these drawbacks should be redeemable in cash ; but the Grand Secretary Li demurred, and I confess that I did not press for the concession with any ardour, the drawback being, so far as duty payments are concerned, a negotiable instrument. As your Lordship is aware, the point was, in December last, conceded; this time, T imagine, at the instance of my colleague, the Minister of Germany; supported by his brother Representatives, at whose instance also the Tsung-li Yamen has consented to direct the discontinuance of the levy of li-kin within tjie foreign settlement at Shanghae ; the discontinuance to commence from the 13th Fehruary last. This, however, is but a step taken pending further discussion. It is not understood to be the last word of the foreign Legations on the subject. These were the conditions of my Agreement. I farther required, before my final Eeport could be made, the communication to me of the papers, eleven in number, enumerated in my note to the Grand Secretary Jii, of the 12th September (see p. 1 of Eeport), which would, to a certain extent, guarantee fulfilment of my conditions so far as these could be given immediate effect to. This demand satisfied, in accordance with my promise contained in the same note, I declared the case closed. APPENDIX. No. 1. Zevy of Li-kin at ShanpTuie. (Extract.) Shanghae, July 4, 1876. IN continuation of my inquiry, I find that piece goods sold within the settlements, or the city, pay on an average about 1\ per cent, squeeze duty, or tax, as the Chinamen called it. Goods sent into the interior, viS, Soochow, are covered by a payment from the Piece-goods Guild to the Taotai of 20,000 taels. The Guild then issues, exemption certificates to the piece-goods men, which are produced at the various barriers between this and Soochow, examined at each, and, if in order, allowed to pass. When the goods reach Soochow I am told that no further payment is demanded, and, moreover, that the distribution from Soochow is also franked. This arrangement, however, is special, and applies only to Soochow and places beyond it, while goods destined to places on this side of Soochow have to be sent under separate certificates of examination, for which the piece-goods men have to pay the Guild the usual half duty. Five years ago the barrier taxes on goods from here to Soochow amounted to 5 taels per bale, and this gave rise to a large increase in the number of transit passes under which goods could be sent up for 2 t. 23 m. per bale. The authorities, finding their gains thus slipping away from them, hit upon the expedient of compromising the whole duties for a lump sum of 20,000 taels per annum. The GuUd farm it, and apportion the amount among the various hongs in the trade, according to the extent of business done in each, and I am told that the cost comes now a little less than it would under the transit-pass system. Goods sent to Kashing or Linghoo are taxed to the amount of 3,000 cash per bale on arrival at their destination, though sent under transit pass. These passes are examined and allowed at Minghong, but apparently the authorities at the town refuse to recognize them at all. Consequently, Chinamen have ceased to apply for them. At Soochow and Hangchow, however, the passes are recognized, and the goods permitted to circulate without any additional charge. Eeplying to your other question : — 1. Gross charge on shirtings from Shanghae to Soochow, under the commutation arrangement, reaches barely 2^ per cent, on value. City and settlements I believe are exactly on the same footing. 2. Gross charge does not exceed the half duty to Soochow, so there is no occasion to apply for transit passes of that city. They would be cheaper for Kashing and Linghoo, but authorities disregard them. Transit passes are used for Soochow and Hangchow. 3. lA-hin and other charges amount, I am told, to a larger percentage on value of foreign goods than native, being about in the proportion of ten on foreign to seven on native. 4 Barriers at Minghong and Wangdoo were established after the commencement of the rebellion, a little inside twenty years, and all the smaller barriers are of even more recent date. I have made several inquiries about the position of barriers, and I find that stations are fixed at every point of access to the country, so that no boat can pass in without having to stop and submit the papers for examination. The squeezes at these small stations are, I believe, smdl, so long as the boat papers are in order, but if any irregularity is discovered the opportunity for a squeeze is made the most of It appears that all the native boats proceeding up the, or via, Secawi Creek, must have clearance papers from the native custom-house, on the south side of the city. That, and the custom-house in the settlement, seem to be the only proper custom-houses where duties are paid and clearance certificates issued. The other stations, such as Minghong and Wangdoo, are only tax stations. No. 2. Difflmlties of collecting li-kin. In 1874-5 the Board of Eevenue memorialized the Throne, complaining that the rule laid down in 1860, that all duty stations should send in quarterly returns of the duties on opium levied by them has not been observed, and that, there being no fixed contribution, there has been great laxity in [1238] K 64 f endijig the prpceeds pf the duties to Peking. To this Memorial there was sent an Imperial Eescript, brdering the Superintendents of Customs to see that the returns are duly forwarded every quarter, and that the duties be energetically collected, &c. The Board of Eevenue, in transmitting these orders, stated that from Liang Ting, under the Tien-tsin Customs, from Kalgan, Sha Hu Kou, and Kuei Hwa .CMng, such inadequate sums as 200 taels to 1,500 taels had been sent as a year's levy. From Han-kwan, Hwai-an, Yang-chow, Ling-ching, and Tung-hai, no improvement in the revenue had been reported for years. That Ningpo and Poochow, where not only duties on opium are collected, but transit dues also, should by rights show a large increase ; the last Eeportg, however, showed a faUing off in the revenue. It is evident that there must be a great deal of remis- ness among the officers, and of smuggling among the people. Yang-chou (in Kiang Su), and other places, have for several years neither sent a cash of opium duty to Peking, nor any accounts whatever of the opium duties. In future those of&cers who fail to forward respectable sums, or who neglect to send in quarterly aopounts, will be severely dealt with. On the 23rd February, 1875, a Decree was issued to the following effect : — Censor Wang Chao-Lan has addressed a Memorial to us, in which he treats of finance, govern- ment, and army drill ; all his remarks are to the point. We order the Board of Eevenue to furnish us with a detailed estimate of the receipts and dis- bursements of each province on account of salt, gabeUe, land-tax, li-hin, sale of of&ces, &c., and to furnish a scheme whereby the former can be increased, and economy effected in the latteK We further order the provincial authorities to send in reports stating the number of li-hin of&ces there are in each province, and annual accounts of the revenue received by each of such offices. As all -the provinces are now at peace, a reduction in the army estimates can be brought about. We order the Board of Eevenue to devise and submit to us a detailed plan of disbandment in each province. We order that no more than the regulated price be charged for articles suppKed by the provinces to the palace, &c. ■The last portion of the Decree only contains the usual orders to the provincial authorities to exercise a strict supervision over their subordinate officials, and to report to the Throne the names of military officers who evince high talents for promotion. No. 3 Further on Li-kin. Early in the year 1875 the Censor, Wang Li-ching, addressed a Memorial to the Throne, which received the Imperial sanction, to the effect that, since the prevalence of disorders, the ordinary revenue not sufficing for the expenditure, offices to collect li-Mn and systems of salt licences were ■inaugurated, and in Kiang Su, An Hui, and Hu Kuang, bureaus were established to sell salt ; that such (Of these offices and bureaus as are in the provincial capitals are superintended by high officials, and are properly managed, but it is otherwise ■with regard to the subsidiary stations in the outlying districts which are presided over by native gentry and elders, who, whenever a case arises, collude with the local authorities in aiding their friends and protecting them from justice ; even the better class of jgeoiry enter into private arrangements with suspected persons, and use their official influence to connive at smuggling. The employment of gentrj' and elders in their own ■villages to super'vise li-Mn offices leads to abuses too grievous to mention. In An-Hui and Hu-Nan, to each of these subsidiary stations there is one seal of office and half-a-dozen officers who use it, and in other provinces there are other mal- jjffactices. The Memorialist proposed, as a remedy to this state of affairs, that in future no one should be employed in his own district as wei-yuan (deputy of a superior officer) in the collection of li-hin. Further, on the 23rd AprU, the Board of Eevenue addressed a Memorial to the Throne, which also received the Imperial sanction, and which was to the following effect : — Li-hin, though not a regulation source of revenue, yields more than any other impost, except land iax, salt, gabeUe, and maritime duties. It is of three kinds : on miscellaneous goods, on opium, and on salt. It was first imposed in the beginning of the reign of Hsien F^ng to supply the necessary military ^expenditure, and now, though peace has been restored, it has to be maintained to supply contingents to Peking and to various disturbed pro-vinces, and to pay the local expenses of maintaining order in the pro^vinces in which it is raised. The Board has frequently memorialized the Throne, praying that orders should be sent to the high aprovincial authorities to furnish it twice a-year with detailed accounts of li-hin receipts. In conse- quence of these Memorials, the Provinces of An-Hui, Kiang-Si, Hu-Peh, Fuh-kien, Kwang-Tung, and ;Kwang-Si, have duly sent in these returns. Kiang-Su, Cheh-Kiang, Shan-Tung, Shan-Si, Hu-Nan, Yiin-nan, and Fungtien (Manchuria), have either only reported the gross receipts, or have delayed sending the returns. Ho-Nan and Sze-Chuen have only sent returns of the li-hin levied on opium, and have not stated whether or no liMn on miscellaneous goods is there levied. Chih-Li, Kwei-Chow, ,Shan-Si, and Kan-Suh have only furnished yearly Eeturns. From the reports to hand it appears that the total receipts on account of li-hin of the Empire are about 17,000,000 to 18,000,000 taels a-year ; of this only 1,200,000 or 1,300,000 are sent to Peking for the troops, and a few hundred thousand for public works ; the rest is either retained in the province that raises it, or sent in contingents to disturbed provinces. It seems to the Board that the amounts retained are excessive, but as only a few of the provinces send in detailed accounts twice a-year, which are very vague as regards expenditure, and as the other provinces only report the gross receipts, the Board has no data on which to take action. Again,.where there is not a fixed amount of li-hin leviable settled, the Government has to rely on the integrity of the collectors j this is why the Board has asked for lists of the names of all persons 65 employed at the subsidiary stations, so that regulations may he put in force hy whict) rewards may he conferred on the meritorious, and the useless got rid of. As yet the provinces have only sent Beporta of the stations closed or opened, and have not given the names of the superintending officers, so that for several years past the Board has not been able to bestow recompenses or inflict penalties upon For the last few years the receipts f^pm li-kin have been falling short. The Board considers this decrease must be caused by malpractices on the part of the collectors, and quotes the Memorial of Wang Li-ching (an abstract of which is given above) in support of this view. It also quotes a Memorial of Censor Wang Chao-lao, praying that the provincial authorities should be directed to send in Eeturns of all the li-kin stations within their several jurisdictions. Under the above circumstances the Board suggests the promulgation of the following orders : — 1. Detailed Eeturns of the three denominations of li-kin must be sent to the Board every six months. 2. No person must be employed as branch collector in his own district. Such persons as are now so employed must be dismissed. 3. Stricter supervision must be exercised over the subsidiary stations. Purchase of posts and extortion must be put a stop to. 4. Li-kin must not be collected more than once on petty trade. 5. There must be a wholesale suppression of unnecessary stations and barriers. 6. There must be means of rewarding or punishing deputies according to their merits or demerits. ... The Board believes that if the above rules are strictly adhered to the receipts on account of li-kin will increase year by year. There is another suggestion which the Board considers of still greater importance. The fact that there is no fixed amount settled of how much li-kin should be levied, that the Board has not been able to decide what percentage should be sent to Peking, and that the tax is paid at the station by the merchant, causes the li-kin to be quite a different kind of impost from the land tax, which is collected by Government. Hence each province looks upon the li-kin it collects as its own money to do what it likes with, and the wei-yuan who collect it, not being responsible officers, have no fear of the consequences of their acts. The reason why the supervision of the high authorities has produced no satisfactory result is, it is believed, because these li-kin sub-collectors combine in sending false Eeturns and in embezzling the receipts ; and it is on this account that, though the Board has asked for a list of the names of aU these wei-yuan, it has never received them. The wei-yuan natu- rally fear that if once they give ia a list of their names, ^ere wiU be an end of their illicit gains, and take good care not to give it ; the high authorities screen the wei-yuan, do not press for the list, and disregard the Board's Memorials. The Board, therefore, prays His Imperial Majesty to again order the provincial authorities to forward the Eeturns, Lists, &c., without delay, under penalty of degradation in case of disobedience. On the 15th April the Board of E'evenue addressed a Memorial to the Throne, which has received the Imperial sanction, and which is to the following effect : — On the 3rd January the Board received a Decree ordering it to report on a Memorial of Censot Hsii Ting-kuei, which stated that, though since 1864 the south and east provinces of the Empire had been restored to order, though land tax and Chinese duties in these yielded a revenue equal to that formerly raised, and li-kin and foreign duties had increased 100 per cent., no reduction had been effected in th6- army or nulitia. He accordingly suggested that Imperial Commissioners should be sent into the provinces to aid the provincial authorities to disband the militia and convert them into regular troops, so as to effect a saving in army expenses. He further stated that the provinces had not supplied the Board of Eevenue with proper Eeturns of the -receipts from li-kin, and instanced the Liang-hwai station, which sold more than 500,000 salt licences a year, and levied 8'4 taels odd on each licence, and consequently ought to collect several milhon taels per annum. He calculated that if to this were added the sums raised by selling licences in Cheh-Kiang, Fuh-Kien, Kwang-Tung, and Sze-Chuen, the amount so realized could not fall short of some 12,000,000 taels, and that, if further li-kin on miscellaneous goods were added, the amount would be probably doubled. Very httle of this money, however, reached the Imperial Treasury. He accordingly proposed that Commissioners shouldrbe sent lo the provinces to report on li-kin receipts and expenditure. On this Memorial the Board of Eevenue remarks that li-kin was first raised in 1861* to supply funds, then urgently required. In 1868 and 1874 the Board called on the various provinces to furnish it with half-yearly Eeturns of the receipts and expenditure of the li-kin, and ad^dsed, in the latter year, the abolition of as many stations as possible. The tax itself, li-kin, is only an expedient to which it was necassary to resort 2>'>'o tempore. In the north and west of the Empire peace is not yet restored, and military operations there, entail an enormous expenditure, which, as weU as the contingents to Peking, is entirely dependent on the li-kin. Under these circumstances, it is evident that the Board would not for a moment allow false Eeturns to be sent in ; the frequent Memorials of the Board are a proof of the attention it has bestowed on the matter, and it now takes this opportunity to again pray His Imperial Majesty to direct the attention of the provincial authorities to its Memorial of 1873, calling upon them for Eeturns of receipts and disbursements, and to abolish such tax- stations as can be dispensed with. The Board considers that some confidence should be reposed in Viceroys and Governors, aU of whom, the Board feels certain, deserve the high trust reposed in them, and that no Commissioners shoiild be sent to report on li-kin, or to aid the provincial authorities in disbandin" militia or in con- verting militiamen into regulars. • It began in 1853, if not earlier.— T. F. W, [1238] K 3 66 The question of the mUitia ought to be left entirely in the hands of the provincial authorities, ■who have the best means of judging of the special local requirements of the places under their jurisdiction. No. 4. Proposed Transit Bule Outwards. I. 1. British merchants purchasing native produce in the interior for foreign export have the option of carrying such produce from the place of purchase to the port of shipment m one of two ways, viz., either with the privileges of the transit provisions of the Treaty, or in accordance with local rules affecting Chinese traffic. 2. If brought from the interior to a port, according to local rules affecting Chinese traffic, such produce must re-port, await examination, and pay dues and duties at every revenue station en route. 3. If to be brought from the interior with the Treaty transit privileges, -the intending purchaser must first of aU obtain a native produce Memorandum (which will be accompanied by a transit certificate) from the custom-house at a Treaty port, and must sign a declaration to the effect that the produce is intended for foreign export. From the place of purchase to the port of shipment, such certificated produce will be required to re-port and await examination at all revenue stations passed, but wiU not have to pay tax or charge anywhere till arrival at the "last barrier" {i.e., one of the barriers nearest the Treaty port, or locally known as the "first barrier to" and the "last from" the interior on that hue). On reaching the "last barrier," the owner must report arrival to the Customs at the Treaty port, and must pay transit dues on the produce before passing that barrier. n. 4. Produce which has thus paid transit dues and passed the barrier pays a Tariff export duty on shipment for a foreign port {i.e., 7^ per cent, ad valorem). ^j„ 5. Produce which has thus paid transit dues and passed the barrier will be required to pay four times the transit dues, in addition to ordinary export duty, at the time of shipment, if sent, not to a foreign, but to another Treaty port, i.e. — Per cent. 1. Transit due .. ., .. •• •• •• ••2^ 2. Export duty ,. ,. ,, ., .. •• ..5 3. Four transit dues . .. .. .. •• •• •• 1.0 4. Coast trade duty . , , , . . . . . • • • . 2i In all .. «c •• at •• •• •.•20 '^'^' 6. Produce which has thus paid transit dues and passed the barrier will be required to pay seven times the transit due, if not shipped within six months to either foreign or Treaty port, i.e., to make up a charge of 20 per cent. 7. After purchase and entry for foreign export at the barrier nearest the place of purchase, if produce does not reach the last barrier within eight months, the merchant concerned will be required to pay to the Customs eight times the transit due on account of inland revenue, i.e,, 20 per cent. Ill 8. Certificated native produce must be the lond fide property of the British merchant concerned or of a foreign house for which he is agent ; if discoveied to be Chinese, owned or conveyed under transit papers on Chinese account, it will be confiscated. 9. The first ban-ier passed, nearest to the place of purchase (and production), will examine the produce, fiU up the blank transit certificate, and send on the native produce Memorandum to the Customs concerned. The merchant or his employes must write clearly on the Memorandum the description, quantity, and quality of produce transported, and must hand that Memorandum, together with the blank certificate received with it from the Customs, to the first barrier when the goods are reported there for examination. 10. Native produce Memorandas will be issued for the province, for a neighbouring province, and for distant provinces, and will be valid for two, four, and six months respectively. The certificates received back from the first barrier wiU be valid for the same periods respectively. Every Memo- randum, whether used or not used, and every certificate, must be delivered up to be cancelled within the period named; failing which, the issue of Memoranda to the merchant concerned wiU. be suspended, and wUl not be resumed tUl the document (Memorandum or Certificate) is returned, or a satisfactory explanation offered. N.B. — The object of the transit system is to enable native produce to pass from the native pro- ducer to the foreign purchaser, for a foreign market, on a payment of 7^ per cent, to the revenue, and that system is not intended to be used to exempt produce circulating in China from necessary local taxation. When accident or intent may have led to any abuse (m'tZe Kule 2, §§ 5, 6, 7), the merchant concerned is required by the Eule now proposed to make a total payment of 20 per cent. This charge, and the right to suspend the issue of Memoranda and Certificates, ought to suffice to protect the revenue and secure the return of aU documents. (Signed) K. HAET. Ckefoo, September 14, 1876, 67 No. 10. Sir T. Wade to Earl Granville. — {Received July 22.) My Lord, Tien-tsin, June 3, 1882. WHEN returning to my post in 1879 I requested Lord Salisbury's permission to visit India, in order that I might obtain information that would guide me in the further discussion of opium taxation. Before leaving Calcutta I addressed a letter to Lord Lytton, then Viceroy, copy of which I forwarded to Lord Salisbury in, 1 think, the month of May of that year. It was acknowledged with thanks by the Government of India after my return to Peking, and allusion has been made to it once or twice in Indian correspondence. It may be thought expedient to lay it before Parliament, and 1 therefore venture to inclose a duplicate copy of my letter. I have, &c. (Signed) THOMAS FRANCIS WADF. Inclosure in No. 10. -Sir T. Wade to the Viceroy of India. My Lord, Calcutta, February 16, 1879. AS I had the honour to inform you on my arrival, I came to India, by permission of the Marquis of Salisbury, to offer to your Excellency in person some explanation of the clauses in the Agreement signed by me at Chefoo, that have been assumed to threaten the opium revenue of the Government of India ; at the same time, to submit to you some alternative arrangement whicli might modify the inconvenience apprehended from that which in the Agreement 1 had undertaken to recommend. Your Excellency thought with me that it would be best that I should reduce to writing what I had to say, and I am concerned to think that more than a month has elapsed since I promised to draw up a Memorandum on the subject. My desire being, in the first place, to be brief, and, in the next, to avoid as much as possible a controversial defence of negotiations the result of which has been more or less attacked, I have found the preparation of my statement a work of greater difficulty than I anticipated. There have been other reasons for the delay which I shall not intrude upon your Excellency's attention. The negotiations referred to, it will be remembered, had for their principal object the adjustment of a misunderstanding occasioned by the attack upon a mission of exploration, sent by the Government of India through Burma into Yiin !N'an ; judicial satisfaction for which I had found it scarcely possible, with the evidence in my hands, to insist upon. My demands, consequently, were directed less to reparation for the past than to security for the future ; and, under this head, it is not necessary to explain at length why improvement of intercourse, diplomatic and commercial, presented itself as a chief condition. For years past, we have not had a just cause of complaint against China that might not be traced to the reluctance of her Government to recognize what is due to us as a Treaty Power her equal in degree, or as a trading community ; and had I not pledged myself, even before news of the Yiin Nan atrocity reached me, in March 1 875, to require some assurance of a better order of things, I should have considered it an omission of duty if I had allowed so favourable an opportunity to pass without availing myself of it. But I was already pledged. I had obtained leave to return to England at the beginning of the year ; and I had warned the Yamen of Foreign Affairs that before I left Peking I must look for such a declaration regarding our privileges, diplomatic and commercial, as would be satisfactory to Her Majesty's Government. Our experience of the Regency, which had lasted from 1861 to 1873, with the prospect of a new Regency similarly constituted, and certain almost to be of equal duration, justified this precaution on my part. Our commercial position in China is, of course, in no small degree influenced by the position our Diplomatic and Consular Representatives are enabled to hold, but there will be no occasion here to examine detailedly in what fashion or degree. The question immediately under consideration is exclusively commercial. Our contention has been that under Article X of Sir Henry Pottinger's Treaty, signed at Nanking in 1842 ; the Separate Article of equal significance with that Treaty, signed at Hong Kong in 1843 ; Article XXVIII of the Treaty, signed by Lord Elgin at Tien-tsin in 68 June 1858, and Rules 5 and 7 of the Tariff appended to that Treaty in November 1858, British imports, opium excepted, are entitled, when their Tariff duty is paid, to exemption from all further taxation until they pass a transit-duty barrier that had existed in 1843 ; and that on imports passing inland of any such barrier, it is at the option of the party interested either to clear the imports to a stated inland market by payment of an additional half-duty at the port of entry, in evidence of receipt of which payment the Port Customs should grant a certificate ; or to pay whatever charges maybe demanded by the Inland Custom-houses along the route. A similar option is secured to the exporter of native produce along the line between the inland market and the port of export. The year 1843 it named as our point of departure, because, in the Separate Article signed that year, it is laid down that, whereas the rate of transit-duty to be levied on British imports had not been fixed in the manner contemplated in Article X of the Treaty of 1842, that is, by declaration of a certain percentage ad valorem, it was now, in this Separate Article, agreed that the amount to be levied on British merchandize as transit- duty was not to exceed the rates then in force, these being on a moderate scale; and that the ratifications of the Treaty of 1842 were now exchanged subject to this express stipulation. This was signed on the 26th June, 1843, On the 8th October, 1843, Sir Henry Pottinger signed a Supplementary Treaty for the regulation of trade ; but this was abrogated by Article I of Lord Elgin's Treaty of 1858, while the same Treaty renews and confirms the Treaty signed at Nanking in 1842. The Separate Article of 1843, as T have said, is expressly allowed to be of equal significance with the Treaty of i842. Lord Elgin's Treaty, signed in June 1858, had stipulated, in Article XXVIII, that within four months of its signature a declaration should be made of the amounts of transit duties leviable between the open ports of China and the inland markets along what may be termed the natural lines of trade; but the declaration not being ready, as from the state of the country it was scarcely possible it should be, it was agreed by Rule 7 of the Tariff appended to the Treaty that the amount of transit-dues legally leviable upon merchandize imported or exported by British subjects should be one-hsdf of the Tariff duty leviable upon such mercliaiidize. While thus dealing with the transit-dues levied at barriers inland of the ports, Lord Elgin had reason to believe that he was dealing with the whole question of taxation over and above the Tariff duties, and this, at the time, was a legitimate assumption. Until Lord Elgin obtained it, in 1858, we had no right of access to the interior ; and the pressure upon our trade, of which we had been for years complaining, was always ascribed by our native constituents to the increase of the dues or fees levied at the transit barriers. This increase, however, was the chief consequence of widespread troubles which had been for some ten years affecting the regular sources of the Imperial revenue, and these troubles had still years to run. The Empire, indeed, can hardly be said at this moment to have done with them. It has accordingly continued, as for some time yet it must continue, beholden to abnormal taxation in more than one form condemned by its traditions. The transit barriers, even of 1858, have long ceased to be the only stations at which this abnormal revenue is collected. The weightiest and most unpopular of its imposts is the li-kin or li-chuan, of which foreigners frequently speak as a war-tax. This term incorrectly describes the tax. Its first object, years ago, no doubt, was the provision of funds for the suppression pf rebellion; but the application of it varies. Its name would imply that the trader patriotically contributes 1 per mil. to the necessities of the State ; but it is, in reahty, a very comprehensive tax upon the trade of the provinces, the imposition of which by their Governments is authorized by the Central Government, but not regulated by it. In its estimates of supply, the Board of Revenue enters such or such sum as to be furnished out of the li-kin of such or such a province, from the total that it assumes will be collected therein ; but the memorials of the Board to the Throne make it plain that Returns of the provincial collections under this head, although frequently applied for, are seldom sent up to it; and it is notorious that the subsidies estimated for,"whether as derivable from li-kin or from other sources, are continually in arrear. The native trader clamours as loudly against li-kin taxation as any foreign merchant; but, as I have said above, some time must elapse before the Chinese Government can afford to dispense with it. Meanwhile, the rapacity of the officials employed to collect it has singularly interfered with our enjoyment of the conditions stipulated for by Lord Elgin. It must be added that from the first the Government, Central and Provincial, has been opposed to the satisfaction of those conditions. Transit passes, or certificates, whether on imports or exports have been in some instances refused altogether. In some instances, when granted, they have 60 not been respected, that is to say, they have not secured the goods they covered against undue detention, or against taxation in transitu. In the ground between the port of entry and the barriers at which transit dues first become leviable — the ground within which Tariff-paid imports should by Treaty be exempted from all further taxation, and which I have been wont to denominate the port-area— /i-fcin collect orates have of late years been multiplied, their operations being extended, at some ports, into the foreign Settlements ; without figure of speech, up to the very doors of the foreign merchant. The Chinese Government's plea of action has been that it had the right to tax the property of its own subjects, and that imports in native hands were no longer foreign property. By parity of reasoning it has defended the detention and taxation of certificated imports in transitu, if these were being carried by the native purchaser. Our case is not so complete in the matter of exports. We have, however, an analogous grievance in respect of these ; but it is unnecessary for my present purpose further to refer to it. What I. have written above exposes, I trust with sufficient clearness, the grievance of our import trade. We had to complain that our imports, opiuai excepted, were illegally taxed within the port-area, and on their way from the port to the inland market. I should add that the grievance was aggravated by the refusal, or professed inability, of the authorities engaged in collecting the duty illegally imposed, to supply us with any infor- mation regarding its rule of incidence. I have excepted opium from the list of imports illegally taxed, because it does_ not possess under Treaty the same rights as the rest of our imports. Lord Elgin's proposition regarding opium amounted to this : Admit into the new Tariff openly the drug which is now introduced into China with the connivance of the Government, and is as regularly taxed as any other merchandize, and you may lay on it what you please once it passes into Chinese hands. I will not claim for it the protection of the transit-duty clauses, nor, in the decennial revisions of the Tariff, shall the same rule be applied to opium as to other goods. No amount of taxation, therefore, that may be laid upon opium after it leaves the importer's premises, can be complained of as illegal. My complaint had been that all other imports were treated as if they were opium, and it was to the cure or mitigation of the evil thus inflicted upon them that I was pledged to address myself. On the other part, I could not ignore the fact that one measure very neces?ary to this end would expose the Chinese revenue lawfully derivable from opium to a certain loss, and against this I cannot but think that J was in honour bound to guard. Let me, at the same time, assure your Excellency that, if the changes 1 was about to recommend bad appeared to me in any way calculated to prejudice the revenue of the Government of India, I should have refrained from any step so advanced as the signature of an instrument com- mitting me to the support of that recommendation. It was to a recommendation alone, as reference to my Agreement will show, that I did commit myself. I could not ha\e conceded restriction of a Treaty right — contraction of our area of exemption from taxatioe in excess of Tariff — or other modification of the commercial clauses of our Treaty, except with the consent, not only of my own Government, but of all other Powers having Treaties with China. Our Treaties have so much in common that it is scarcely possible, in trade it is impossible, that amendment of any single Treaty should be operative, unless all are agreed to adopt it. Accordingly, when I undertook, on my own responsibility, to close the Yiin Nan affair if certain conditions were satisfied, I especially stipulated that my colleagues, the Repre- sentatives of the Treaty Powers, should at once be invited to consider the proposition I was about to submit to my own Government ; and that, in token of good faith, the draft of the Tsung-li Yamen's Circular to the different Legations was to be shown me. Tbis was done. And now, before going further,! will briefly restate the proposition which immediately affects the matter before me. I was convinced that, for some tihie to come, it might be years, the Government of China would not be able to dispense with its li-kin revenue ; and that, so long as li-kin coUectorates existed for the taxation of native trade, so long would it be certain that foreign imports would be made to feel its weight wherever the li-kin coUectorate might be beyond reach of Consular surveillance. I feel equally sure that whenever the financial condition of the Empire might enable it to give up this trade tax, so odious to the native merchant, it would no longer be laid upon the foreign import trade; for, considerable as it is, the whole foreign trade is but small in proportion to the internal trade of the- country; and I do not believe that it will ever pay to maintain li-kin, coUectorates exclusively for the taxation of foreign imports. Having secured, as I conceive, a more just interpretation than has heretofore obtained of the transit-duty clauses of the Treaty of 1858,1 proposed, therefore, that if the Government of China 70 conceded us greater opportunities of trade than we possessed, we should restrict the area of our exemption from li-kin. . For various reasons, a principal one being the difficulty of precisely defining the area to which, in theory, the Separate Article of 1843 would entitle us, I proposed that the limits of the new 'area should coincide with those of the foreign Settlements at the ports, which it would devolve on the foreign Consuls and the local authorities to consider together. This delimitation would involve the exclusion of the li-kin collectorates from the port-area, and the exclusion of those would, of course, render necessary an adjustment of the taxation of opium, the only one of our imports on which the Chinese were, under Treaty, entitled to impose taxation in excess of Tariff duty in a port-area. I proposed, accordingly, that the collectorates once banished, the li-kin on opium should be levied by the foreign Inspectorate of Maritime Customs, an admirably organized Service, whose proceedings would be as regular, as the action of the li-kin collectorates' Executive had proved itself, at Shanghae at all events, the most considerable of the open ports, to be fruitful of misunderstanding. On somewhat similar grounds I subsequently recommended alike transference to the foreign Inspectorate of the duty of collecting li-kin on opium brought into Hong Kong. The trade of the Colony with the coast of China, unless in foreign bottoms trading to and from the Treaty ports, is of course a question per se outside the Treaties. The Chinese Government, in order to protect itself against loss of revenue, eminently of revenue on opium, has planted native Custom-houses on different points of Chinese territory in the neighbourhood of the Colony for the surveillance of the junk trade, which is further watched by a preventive service of small steamers. The right of the Chinese Government thus to protect its interests was beyond dispute. Its modus operandi had been as vexatious as the action of Chinese officials uncontrolled is ever certain to be. The revenue the Chinese most desired to secure in theti'ade in question was, beyond doubt, the opium revenue. This secured, 1 hoped, on our side, to secure the extinction of the obnoxious cordon. Removal of similar causes of bickering is of advantage to more than the interests of the Colony per se, precious as these may be allowed to be. My suggestion regarding Hong Kong, however, was doomed to shipwreck. The Superintendent of Customs at Canton objects to place the junk trade, in the manner I propufed, under the foreign Inspectorate. He has instead assented to a Code of Regula- tions which, if the native Executive observe them, will diminish the inconvenience complained of. F^ut it is too much to hope, so long as the three Custom-houses are maintained, that there will never be cause of offence to the Colony. The Chinese Govern- ment, on the other part, will undoubtedly lose much both of the Tariff revenue and li-kin on opium that the foreign Inspectorate would have collected for it. The recommendation that the foreign Inspectorate should collect the li-kin on opium brought into the Treaty ports, out of deference to the wishes of your Excellency's Govern- ment, has not either been confirmed. I had not contemplated as necessary the formal ratification of the Chefoo Agreement ; but as I exacted the publication of an Imperial Decree approving that instrument before I would consent to report a final settlement of the Yiin Nan affair, the Government of China has claimed a corresponding expression of approval on the part of our own. It has satisfied, it contends, all the conditions insisted upon by me, and it urges that we are equally bound to confirm the provisions of the Cheefoo Agreement. This, to a certain point, is fair argument. Not anticipating in any quarter serious objection either to the proposed method of collecting li-kin on opium, or to the exchange of the larger poit-area of exemption from li-kin against the proposed extension of trade, I stipulated that the four new ports of residence and the six ports of call, which were to be the price of our concession, should he opened within six months of the receipt of the Imperial Decree above-mentioned, and these ports were all opened within the six months. But, as in duty bound, 1 provided that the date for giving eflfect to the stipulations affecting exemption of imports from li-kin taxation within the foreign Settlements, and the collection of li-kin on opium by the foreign Inspectorate, should be fixed as soon as the British Government had arrived at an understanding on the subject with the other Treaty Powers. Now the Representatives of various of the Treaty Powers having objected in particular to the reduction of the port-area to the narrow limits recommended by me, the discussion of the port-area question will be resumed on my return to Peking ; and however this may be ultimately disposed of, it will be impossible that the question of opium li-kin should not be also revived. The eagerness of the Chinese Government to see the Chefoo Agreement ratified is, in my belief, mainly due to its apprehension that without some 71 such protection as that provided by the Agreement, the li-Mn revenue must sustain a serious loss. Its fears are not without foundation. The further the boundary of the port-area is made to recede the greater, of course, the chance of such loss. Shortly after my departure from Peking, the foreign Ministers there resident called upon the Chinese Government to withdraw its li-kin collectorates from the Settlements at Shanghae, not as a concession referable to my Agreement of the limitation of the port-area recommended in which, as I. have stated, they disapproved, but in part satisfaction of the Treaty right of far older date by which foreign imports ought to be exempted, while between port and inland barrier, from all taxation in excess of Tariff. The Settlements of Shanghae, which cover a few miles of ground, are occupied in great part by a Chinese population of brokers and shop- keepers. These, of course, profited by the removal of the li-ldn collectorates, and the Chinese of the same class inhabiting the city and suburbs of Shanghae let the authorities understand that, unless their burdens were similarly lightened, they should transfer their establishments, to the foreign quarter. The authorities gave way, and for more than a twelvemonth I have reason to believe that no li-kin has been levied in Shanghae or its immediate vicinity, at least, not by collectorates of the old stamp. Some portion of it will be doubtless recouped from the trading guilds under another form or title of taxation. The loss in opium revenue, I imagine, must be considerable, and if the Government of India be still averse to the intervention of the foreign Inspectorate in the collection of li-hin, I venture to hope that it will not be equally opposed to a certain increase of the Tariff duty, the li-kin tax b^ng left as formerly, though at a comparative disadvantage, to take care of itself. It has been urged that it is in violation of international practice to pledge a Govern- ment, as I desired to pledge mine, in a diplomatic instrument, to sanction of the levy of a tax in the nature of a municipal or inland due in addition to a Treaty import duty, except as a commutation of such due, and with the view to placing the amount, defined and limited, under an international guarantee ; further, that it is a mere form to maintain the Treaty limitation of the import duty, while, at the same moment, and at the same spot, the authorities are at liberty to levy what they like under the name of li-kin. The authorities have, in reality, been free to levy what they pleased in addition to the Tariff duty ever since the Tariff came into operation in 1860, and they have taken advan- tage of their right, but, as I beHeve, solely with reference to the circumstances of the different ports of entry. It was this consideration that influenced me when I recommended that, if the corrupt and troublesome native Executive heretofore charged with the levy of the li-kin were to be stripped of their office, that tax, which the Chinese Government has the fullest right to levy, should be collected by the foreign establishment which has the exclu- sive collection of duties on foreign trade in its hands. I did not believe that the sale of Indian opium would be in any degree diminished in China by the measure, and this for two sufficient reasons, firstly, that Indian opium is a requirement of the Chinese people, and secondly, that the revenue derivable from it is sorely needed by the Chinese Government. As to the suppression of opium-smoking upon moral grounds, I cannot think that for years it will be attempted; the habit is become too general. Native opium is produced in every part of the Empire that will bear the poppy, notably in the provinces of Yiin Nan, Ssu Ch'uan, Kan Su, and Shen Si. In these and the districts adjoining them I doubt that Indian opium is consumed at all. In Manchuria the native- opium competes with the Indian, and, as I have before intimated, it may one day come to pass that improvement in the cultivation of the poppy, and preparation of the drug, will place the foreign import at a disadvantage. But that day is not, in my opinion, near at hand ; and meanwhile, so far as the Chinese Government is concerned, it is certainly discovering no tendency to encourage the development of a native opium trade ; on the reverse, it formally protests against cultivation of the poppy, and although with some inconsistency the authorities levy li-kin upon native opium, its production is none the less interdicted. I have before me two letters written last August by a Chinese high in office, who is very anxious that the Chefoo Agreement should be ratified, and on this account doubtless what falls from him must be taken cum grano. Still, his remarks upon the native opium question are not undeserving of attention. He is writing especially to deprecate any suspicion on our part that his own Govern- ment desires to foster the production of native opium in order to drive ours out of the market. All evidence, he contends, points the other way. An Imperial Decree has recently been issued enjoining the Provincial Governments to prohibit the cultivation of the poppy I 12ooJ L 72 within their respective jurisdictions. Whether success has attended this effort of the Central Governtnent or hot, he urges, it suffices to show the importance it attaches to the discontinuance of poppy cultivation ; and this for the two-fold reason that, while addicted- ness to the use of opium demoralizes and ruins the people, cultivation of the poppy impoverishes the soil, and renders it unavailable for production of the necessaries of life. It has been brought to the notice of the Government that the increasing cultivation of opium had so interfered with the raising of cereals as in many places to have caused or aggravated the recent famine. Land formerly devoted to food-stuffs had been given up to the poppy. In years of plenty, consequently, the grain produced in the districts referred to was insufficient for the wants of the population, while in years of dearth the people were reduced to starvation, or had to emigrate as paupers. As to our alarm lest home-grown should compete with Indian opium, there can be no prospect, he maintains, that the former will displace the latter. " It is notorious that the poppy grown in China cannot produce good opium. Indeed, the quality of the Chinese product is so inferior that it is used only by those who would be unable to buy the more expensive Indian commodity, even were it imported duty-free, while the wealthier classes regard it as vulgar to partake of any other opium than Indian." There may be here some slight exaggeration. It is beyond doubt, at the same time, that the Indian opium is considered the more fashionable, as well as the fuller flavoured of the two. In Peking society, at least among the younger men who have time to idle together, it is become as much the usage to offer a visitor a pipe of opium, as with us to invite him to smoke cigars or cigarettes ; and it would certainly not be considered good style to give him any but the foreign drug. The letter goes on to affirm that the Chinese Government has no thought whatever of availing itself of the Chefoo Agreement to raise the li-kin on Indian opium to a pro- hibitory rate. It would be glad, he writes, to see its importation stopped altogether, were this possible, which the writer knows it is not. The Government is set upon the prohibi- tion of opium cultivation at home ; but this he knows can only be effected gradually. The Chinese Government, he adds, levy li-kin on native opium, as well as on Indian opium, and at the same rate. The last assertion I take leave to doubt. Finally, he declares that the sole object of the proposed simultaneous collection of li-kin and Tariff duty is the prevention of smuggling ; the security, that is to say, of the revenue to which the Government is entitled when the drug passes out of foreign hands. I believe that there is much truth in this last statement. The Government is sorely in want of money; and although it is frequently chargeable in its local finance with suicidal eagerness to secure the golden egg, it must be admitted to have shown, on the whole, an intelligent tenderness in its treatment of opium li-kin. I give below a list of the open ports at which I have been enabled to ascertain, approximately, the rates of li-kin levied per picul on foreign opium. Of the li-kin on native opium I know nothing to be relied on. The tael is an ounce of silver estimated by the foreign Inspectorate as equivalent to 6s. sterling : — Taels. Kittng-chow (Hai-nan) . . . . . . . , . . . . 23-0 Swatow . . . . . , , . . . . . . . 21-5 Amoy .. .. .. ,, .. .. ., 84-6 Foo-chow .. ,, .. .. ., .. .. 84-6 Ningpo .. .. .. .. .. .. .. 32-0 Wtochow .. .. ., .. .. .. _ 40-0 Shanghae .. .. .. .. .. 40 -q Chin-kiang ,. .. .. .. .. ., .. 16-0 Chefoo .. .. .. .. .. .. _ 32-0 Tien-tsm .. .. .. .. .. .. ,, is-o New-chwang .. .. .. „ .. .. _ 18-0 Hankow .. .. .. ., ., ., _ 30-0 This list does not include the new ports of I-chang, Wu-hu, and Pak-hoi. The last is but a branch of Kiung-chow, and the rate of li-kin is probably the same at both ports. At Canton, Tam-sui, and Ta-kow, which do not either appear in the list, we may be sure that the li-kin is not below 20 taels per picul. At Canton it is certain to be much higher. I have before me the Returns of Trade at the Treaty ports for the year 1877, prepared under the du-ection of Mr. Hart, Inspector-General of the Maritime Customs, and chief of the foreign service, known as the Customs' Inspectorate, which are thoroughlv trust- worthy. _ I append the reprint of a Table extracted from p. 13 of this Return, show'ing the importation of opmm_ into the open ports from 1870 to 1877 mclusive ; and according to the data contained in this, I make out that of the 12,000,000 taels collected on the 73 foreign import trade in r§77, the opium yielded upwards of ^,000,000 taels in Tariff duties', while, according to the rough li-kin Table above given, there must have been collected on the year*s impori: at least "some 3,500,000 taels. This last is my estimate. It will strike any one that the entry of opium at Canton is inconceivably small ; but this is due to the near neighbourhood of Hong Kong, from which, as also along the coast east and west of the Colony, the opium is carried to Canton in native junks. The import into Hong Kong in 1877, not accounted for at the ports, was some 25,000 piculs, of which a small quantity would be consumed on the island and a small quantity transhipped to California. The balance must have found its way into China. Allowing that 20,000 piculs were so carried in junks, this quantity, had it passed thrbugh the open ports, would have paid 600,000 taels Tariff duty, and scarcely a less sum in li-kin. It does not follow that it paid nothing. It no doubt paid li-kin and irregular fees. But the revenue due on it was, without doubt, in no small part evaded ; and that the Hoppo, or Chinese Superin- tendent of Customs, should, most probably from corrupt motives, have dechned the assistance of the foreign Inspectorate in collecting it, may be held an argument against my povsition that the Government's carefulness of its opium revenue is to be counted on. A Chinese authority will always be jealous of the apparent intervention of a foreigner between him and his nationals ; but, besides this, the appointment of the Hoppo of Canton is peciiliar. He is always a member of the Imperial Household. He is sent to make his own fortune, but on the understanding that he is to supply many things that should be paid for out of the Privy Purse. It would scarcely be fair to argue from Canton to the other ports. Of- the slackness of the native authorities when left to themselves I take leave to give one other instance. At Peking, which is closed to foreign trade, there is a very heavy octroi. In 1876, according to Mr. Mongan, our Consul at Tien-tsin, there were forwarded thence to Peking some 2,300 piculs of opium : " Say that 500 piculs of this (a very liberal allowance) were smuggled into the city, there remain 1,800 piculs which should have paid octroi duty at the city gates. This duty last year (1876) was 38^ taels per picul, and its amount therefore should have been 69,300 taels. But in the ' Peking Gazette ' of the 6th October, 1876, it is officially reported that the duty collected oh opium at the gates of Peking during the year ending 19th September, 1876, but amounted to 1 1,299*7 taels, leaving a balance of 37,000 taels unaccounted for, supposing the above estimate (Mr. Mongan's) to be correct." I have been desirous of setting before your Excellency sUch a statement as will make plain not only the position of the opium trade in China, but my own difficulties in dealing with it. I write almost apologetically, because I am aware that in my action regarding it, it has been thought that I showed indifference to the duty of preserving iiltact to the Government of India a source of revenue of paramount irhportahce. I have shown why I touched the opium question at all ; that I could not have left the general taxation of our trade untouched, and that 1 could not approach this latter without &t the same time con- sidering the protection of such lawful interests of the Chinese Govetnttient, as my exaction of what was due to our own trade must have more or less jeopardized. I did not cohceive that the stricter collection of li-kin would jeopardize the trade in Iridian opium, even if the rates of li-kin were to be considerably raised. Mr. Hart, a high authority, was of opinion thatj were a uniform rate agreed to, our opium would bear a heavier li-kin than has ever been laid upon it except at Foochow and Amoy. I fear that I cannot now avoid pressing the Government of India to assent to some arrangement by which some payment in addition to the present Tariff may be secured to the Chinese Customs before the opium passes into consumption. I had a conversation with the Minister Kuo Sung-t'ao the day before I left London, and he insisted much on the loss of revenue that must certainly ensue on the expulsion of the li-kin coUectorates from the Settlements, or the expansion of the port-areas, if we at the safne time refused to intrust the collection of the li-kin to the foreign Inspectorate. We caimot, I think, go back. We cannot say to the Chinese, "Take back the four ports of residence that you have opened, and the six places of call, and give us the port- area to which, under the Treaties, we were entitled ; and take your li-kin, as before, off the opium as you may." This would land us in our old difficulty of defining the port-area to which the Treaties entitle us, and which other Powers would certainly not consent to contract without a quid pro quo. I know of no quid pro quo worth the having except the extension of our trade by the opening of new ports ; this being a gain, it may be remarked, not less to trade in opium than to other trade. The proposition to rfesume the status quo, although it may be legitimate in the coming negotiations to advance it hyjjothetically, could hot be insisted on withdut ufif)leagant consequences. Thfe Chinese wohld not fail to impute [1238] L 2 74 bad faith to us, and our trade would not improbably pay ths penalty in one form of vexation or other. . I should be glad, therefore, to be authorized to adopt one or other of the following courses. The definition of a port-area at every open port being now to be determined by the Treaty Powers, I would propose that the amount of additional duty, whether levied as li-kin or otherwise, be greater or less according as the boundary of the area be nearer or further from the port custom-house. The larger the port-area, the larger the addition to Tariff duty to be conceded. The U-kin tax, be it observed, is to be tolerated beyond the limits of the port-area, upon all imports not protected by transit duty certificate. Opium, by Treaty, cannot be so protected ; but the larger the port-area, of course, the larger the local consumption and the retail trade ; and the greater the difficulty of the li-kin collectorates in watching the drug through and out of the port-area. I believe that the trade would be most favoured by an agreement to concede such an amount of duty as would tempt the Chinese to keep their li-kin collectorates altogether out of the pOrt-area, no matter what its extent ;. but this would not be equally practicable at all the ports. At Canton, for instance, we could not expect it. The li-kin on native trade in such a city is too considerable to be foregone. The same may be said of one or two other large centres. At such places I should be for concession of the minimum rate of increase ; certain that, both when in consumption and in transitu, the opium would speedily have to pay more than the first charge. But if the principle be admitted that there is to be an addition recognized, and an addition differing according to circumstances, it will then have to be decided, whether that addition shall be made in the form of an increased Tariff duty, or in the form of li-kin. Mr. Hart, whom I consulted before I left England, expressed an opinion that an increase of the Tariff duty would be preferable to the alternative measure, because if li-kin were collected by the Foreign Customs, it would be passed into the Imperial as distinguished from the Provincial Accounts ; and although by sanction of the Board of Revenue, portions of the Foreign Customs duties are applied to the use of the provinces, the li-kin, as we know, is looked upon, in the provinces, rather as provincial revenue with which the chief of the jurisdiction deals more or less independently of the Board. It may be objected that if we once assent to a higher Tariff duty than the present, we shall never get rid of it ; while the li-kin, although the tax has probably a long lease of life, whenever it dies out on other trade, will not be continued on opium alone. My belief is that, with the liberty reserved them by the Treaty of 1858 to tax Indian opium as they please, they are no more likely to leave it untaxed than we should be to leave foreign wines or other commodities which, though luxuries, have become essentials to us, he'li-kin abolished' or retained. I should like to be left free by the Government of India to ascertain which of the two courses would be the more acceptable to the Chinese, and to be guided by the arguments they may employ in favour of either. I have still a safeguard against miscalculation in the proviso that whatever may now be agreed to is to be regarded as an experiment only ; the success of the experiment being at the same time guaranteed by the engagement that, if good faith is kept, the revision of our Treaty now due shall be postponed for five years. There is one argument in favour of the li-kin payment, namely, that the importer of opium will not, as a first charge, be more heavily taxed than at present. Another is that as it involves no alteration in the text of the Treaties, it will hardly be possible for any Treaty Power to object to it. . There remains only to be considered the additional amount of duty which we are prepared to agree shall be paid if the one course is adopted, or the amount of li-kin to be levied by the Foreign Inspectorate, if the other be approved. I do not forget that whichever course be followed, the opium will be farther taxed inland, it may be very near the port. But 1 rely once more upon the self-restraint of the Chinese Government where its opium revenue is concerned. If the dread of the smuggler be a check upon its tendency to immoderate taxation, the refusal of the Canton Super- intendent to ally himself with his foreign coadjutors will preserve to the Hong Kong junk trade much of its old opportunity. Kven without this door open, 1 believe it impossible for the time being to extinguish the trade. Accepting, therefore, scarcely half of Mr. Hart's estimate of what the trade will bear, I should not be afraid to allow an additional Tariff or li-kin tax of from 20 to 40 taels per picul ; and if authorized to set the concession, as above suggested, against extension of the port-area, I should apportion my amounts according to the principle earlier indicated. The larger the port-area, the better for all trade, the opium trade included. Its definition, so long resisted, will relieve 75 all trade of a great part of the worry that now afflicts it. The Chinese, who have always withstood our contention that a port-area is a Treat j' right, will yield it reluctantly ; but besides the consolation they will not fail to derive from augmentation of their Tariff revenue, our proposal will protect us against the allegation that we have not been acting in good faith, and that when.in accordance with their promise they had opened new ports to our trade, we had not been equally careful to do what we had undertaken. I have, &c. (Signed) THOMAS FRANCIS WADE. Opium. Appendix. -Net Importation into each Port, 1870 to 1877. Tort. 1870. 1871. 1872. 1873. 1874. 1876. 1876. 1877. Total Total Total Total Total Total Total Malwa Patna. Benares. Sorts. Total.'' Import. Import. Import. Import. Import. Import. Import. Viculs. Piculs. Picnls. Piculs. Piculs. 40,167 Picnls. Piculs. Piculs. Piculs. Picnls. Picnls, Piculs. Sliaughae 48,138 41,984 41,063 43,670 37,018 43,068 31,920 8,564 4,897 358 45,739 (Imported and stored on board receiving vessels.) Shangliae (Re-exported from receiv- ing vessels, cliielly to 31,1« 30,004 28,912 30,043 31,980 39,579 38,399 29,853 1,369 816 333 32,261 other Clr.nese ports.) Slianghae 11,700 11,697 13,349 12,784 11,397 10,699- 11,884 1,617 7,178 4,034 15 13.734 (Landed for local coa- Biimption.) Kewchwang 2,143 2,279 2,160 3,421 1.327 896 3,303 . 988 30 43 31 1,098 Tien-tsin j.. 7,161 7,091 4,653 4,958 5,333 3,881 3,606 3.769 164 46 67 4,028 Chefoo Ichaug Hankow 8,914 3,203 3,813 3,104 4,153 2,960 2,238 2.083 31 49 ... 2,152 3,678 3,141 3,413 2,994 3,861 2,335 2,189 3,271 183 4 17 3,477 Kiukiang a,iio 2,064 1,934 2,866 2,905 2,346 2,043 1.845 6 I 1 1,853 Wnhu 1,157 2 2 1,161 Cliinkiang 6,943 6,986 8,676 9,636 10,964 11,758 10.649 9,783 506 479 32 10,799 Ningpo 5.024 6,425 6,549 7,368 7,469 8,508 8.803 7,611 301 123 23 7,991 ■Wfinchow 27 11 *.. 38 Foochow 4,256 3,529 3,887 8,376 3,176 4,014 4,017 1,751 1,339 149 36 3,165 Tamsui 1,163 ],.306 1,400 1,611 1,666 1,559 1,859 1 60 1,164 441 1,669 Takow 1,731 1,971 1,941 1,952 3,603 2,600 2,659 9 177 1,699 1,283 3.163 Aiuoy 3,098 3,056 3,125 3,379 3,370 3,893 3.153 1.874 1,813 358 4,045 Swatow 4,840 6,840 7,415 9,105 9,373 10,185 11.679 7.678 3,939 1,015 11.623 Canton 754 1,076 949 824 973 938 450 133 303 ... ..• 334 Kiungchow ••• 520 330 383 17 725 Pakhoi ... 6 6 Total 58,817 59,670 61,193 65,797 67.468 66,461 68.043 10,963 16,168 10,633 3,389 69,062 The sorts imported, and estimated values, are shown in the Table below. All the opium imported into China reaches it through Hong Kong. As the quantity consumed there is comparatively trifling, the amount brought into China in native vessels, and which consequently does not appear in these Returns, must be nearly equal to the quantity by which the Hong Kong importation exceeds the entries at the Treaty ports. A deduc- tion must be made from this for the amount sent to California for the use of the Chinese there. This has been for the last eight years as follows : — 1870 .. 1871 .. 1872 .. 1873 ,. 1-874 .. 1875 .. 1876 .. 1877 .. Boxes. 272 1,409 796 1,748 359 1,824 1,098 1,163 Dollars. 102,970 596,190 344,833 680,437 155,273 829,971 462,741 501,550 Say, Hk. taels. lJ 69,575 402,831 232,995 459,755 104,914 663,314 300,782 341,190 The total importation into Hong Kong, its excess over the entries at the Treaty ports, and the estimated value of each, are shown in the following Table : — Year, Imported in Foreign Vessels into Chinese Ports. Hong Kong, Malwa. Patna. Benares. Sorts. Total. Value.' Total Import. Value. Excess. Value. 1. Piculs. Piculs. Piculs. Piculs. Piculs. Hk. taels. Piculs. Hk. taels. Piculs. Hk. taels. 1867 .. 34,006 14,809 11,488 645 60,948 28,823,942 86,530 30,655,924 25,582 10,831,982 1868 .. 31,231 12,315 9,179 1,187 53,915 23,538,621 69,537 29,871,864 15,622 6,333,213 18G9 .. 29,287 13,990 8,771 1,368 53,413 23,727,165 86,065 38,223,238 32,652 14,496,073 1870 .. 34,045 14,443 8,671 1,658 ■ 58,817 24,967,196 95,045 40,328,764 36,228 15,301,568 1871 .. 35,050 15,281 8,023 1316 59,670 26,045,878 89,741 40,690,974 30,074 14,645,095 1872 .. 37,803 15,473 7,039 878 61,193 25,295,131 86,385 34,704,689 2,i,192 9,409,558 1873 .. 40,910 14,974 9,326 587 65,797 26,255,295 88,382 32,467,697 22,535 6,212.402 1874 .. 41,867 17,048 7,753 800 67,468 27,233,421 91,082 33,175,559 23,614 5,942,138 1875 .. 40,693 16,475 7,965 1,328 66,461 27,013,566 84,6 1 a 29,106,923 18,158 2,093,357 1876 .. 42,708 15,689 8,359 1,286 68,042 27,661,466 96,985 36,491,288 28,943 8,829,822 1877 .. 40,963- 15,168 10,632 2,289 69,052 29,885,226 94,200 32,303,963 25,148 2,418,737 , 76 Sir T. Wade to Earl Granville.— (Received July 22.) My Lord, Peking, June 3, 1882 .MY telegram* will have prepared your Lordship for a final Report from me upon the question of opium taxation. I must begin with a recapitulation of its histoty. The discussion of this question now, as I trust, drawing to a close, dates, it may be said, from the signature of the Chefoo Agreement in 1876. Believing that the exemption of our imports from the abnormal taxation known as the li-kin, within the area of freedom claimed by me under the British Treaty, would prove next to impossible, so long as li-kin Collectorates for the taxation of native trade existed, I consented, if the Chinese Govern- ment would open certain ports and places of call to our shipping, to move Her Majesty's Government to ignore the collection of li-kin beyond the limits of the foreign port settle- ments as already defined ; or, where these had been undefined, beyond such limits as should be accepted by our own and other Governments. The Treaties of some of these, it should be noted, were read as considerably extend- ing the area of exemption from taxation inland of the port so far claimed by me. To return to our own Treaty, the transit duty remaining in force, imports would, as heretofore, claim to be cleared at the option of the owner to any inland centre by the pavment of a half Tariff duty. My proposal to exclude the li-kin Collectorates from the foreign settlements was suggested, not only by the complaint that their levy of li-kin up.on foreign imports was in violation of Treaty, but by the fact that when levying li-kin, which th°y were entitled to levy wilhin the settlements, they came, or were liable to come into collision with the gn/asi-nmnicipal police maintained by the port communities. The levies of the Collectorate Executive, on the one part, would not always be within the bounds of their authority ; on the other part, the Chinese taxed were ready enough to avail themselves of the protection from the.taxgatherer, which an appeal to the settlement police might secure t!;em. This was not notably the case in the matter of opium. The Chinese Government had an undoubted right to tax opium as soon as it passed into the hands of the Chinese purchaser, but the attempt of the li-kin Collectorate to tax it in the settlement, of Shanghae for instance, had been more than once resisted, appeal being made to our Consul or to our Supreme Court. If the Chinese Government, as the Chefoo Agreement required, were now to withdraw its li-kin Collectorates from the settlements, it would scarcely fail to lose no little of the revenue due to it on opium ; and feeling in duty bound to guarantee it against that loss, I iagreed to move Her Majesty's Government to consent to the levy of the opium li-kin and Tariff duty together ; the action of the native li-kin Collectorate being supplied by that of the Foreign Customs Inspectorate, *'hich had, ever since legalization of the opium trade by the Treaty of 1858, collected the Tariff duly of 30 taels per picul upon the drug. The rate of li-kin varied at different ports, iind I conceived it desirable that the rate should, if possible, be uniform. The Grand Secretary Li, however, would not accept a lower rate than 60 taels at every port, and it was accordingly agreed that if the joint collection were assented to by Her Majesty Government, the rates should, as in time past, be regulated by the requirements of the several provinces. The arrangement I undertook to recommend regarding the general import trade did not commend itself to several of my colleagues, the Representatives of Treaty Powers then ill Peking, and they requested their respective Governments to deprecate its ratification. On the other hand, the Government of India became seriously alarmed at what appeared to threaten opium with a weight of unlimited taxation. I have no right to be surprised at the impression produced upon the Government of India. The missionary world received the same impression ; and, consistently with its professed belief that the trade in foreign opium is 'chief among the obstacles in the way of the teacher of religion, was as much delighted as the Government of India was dismayed. 1 shall not pause here to consider the moralist view of the question. I hope to submit to your Lordship elsewhere some remarks upon this subject. For the moment I keep to its material side. I believe that in reality the Government of India need have no iear for its revenue. This country is a vast opium-producing and opium-smoking region. The wealthier smoker prefers the Indian drug because it is the best. The, Chinese • See No. 6, 77 Government, although by no means wholly insincere in its condemnation of both produc- tion and consamptioh, derives a large revenue from both native and foreign opium. The taxation of the latter might have been, certainly would have been, raised in some instances, but I doubt extremely that it would have so risen as to jeopardize the revenue of India, However, the Government of India thought otherwise, and it has consequently been mv endeavour to substitute for the arrangement contemplated by the Chefoo Agreement some other that might be considered fair to the Chinese Government and not injurious to our own interests. It was to this end that I paid a visit to India on my way back here in 1878-79, and having conversed, very informally, it is true, with various members of the Government upon the subject, I submitted my own views to Lord Lytton, then Viceroy, in a letter, copy of which I forwarded on my return to the Marquis of Salisbury, then my chief. I inclose a duplicate of that letter,* from which it will be seen that, while inclining on the whole to a concession of increased Tariff duty as preferable to a fixed uniform rate of li-Mn, I begged that I might be left free to ascertain which proposition might be regarded by the Chinese as the more acceptable. On my arrival at Tien-tsin, in the summer of 1879, I again discussed the matter with the Grand Secretary Li, the negotiator of the Chefoo Agreement, and I was not long in discovering that the measure most in favour was the joint collection of Tariff and a uniform rate of li-kin by the foreign Customs Inspectorate. My estimate of the uniform rate, however, was still considered too low. From the data in my possession (see p. 7 of my letter to Lord Lytton), I argued that the li-kin collected, taking port with port, did . not average much more than 30 taels per picul, and that, considering the small amount of li-Mn that can be made sure of once the drug emerges from the port area, a 40 tael rate would be liberal. I was prepared for an invitation to recommend Her Majesty's Govern- ment to go as far as 50 taels. But we did not reach this point. The Grand Secretary, acting, I thought, under instructions from Peking, suddenly became, to all appearance, indifferent to further prosecution of the negotiations. I had hardly returned to Peking when my colleague the Minister of Germany, the revision of whose Treaty was still incomplete, invited me as Doyen to call together all the Representatives of Treaty Powers for a Conference upon the inland taxation of trade, import and export. We were also to consider other questions affecting our Treaty relations with China, but the question of trade is that to which alone it is necessary to refer at this moment. I had myself made it a condition with the Tsung-li Yam^n, before I took on me to declare the Yun-Nan affair closed in 1876, that the foreign Representatives should be invited to take up the whole of these questions. The Yam^n did issue its Circular note, but without result, and I was to a certain extent in a position of disadvantage vis-a-vis the Tam^n, as it was thus enabled to contend that every condition affecting trade that 1 had required of the Chinese Government, in the Chefoo Agreement, had been satisfied, while on our side nothing had been done. Nor would it admit that Her Majesty's Govern- ment was in any way hampered by the objection of foreign Governments to the commercial clauses of the Agreement. The Minister of Germany had demanded removal of the li-kin Collectorate from the Shanghae settlement, on the ground that its action was in contravention of Treaty. But the YamSn persisted in maintaining that this demand, so far as Shanghae was concerned, was based upon a virtual acceptance of the Chefoo Agree- ment, against which, as I have said, the Minister of Germany and others of ray colleagues were at the. very time protesting. The demand referred to had been coupled with an intimation from the Minister of Germany and his colleagues, that no objection would be made to the levy of K-Mn on opium within the settlement of Shanghae ; but of this I was not aware until nearly a twelvemonth had passed. The Yam^n never alluded to it, and I was first informed of it by the Minister of Germany himself, in the course of a conference upon the general trade last year. Let me say here that I regard this concession to the Chinese, if concession it may be called, as a perfectly legitimate concession on the part of my colleagues concerned. The Chinese, in my opinion, had as much right to lay a U-kin on opium in the settlement or any larger port area, as they had no right to lay it upon other articles of the import trade. I merely mention it here as part of the history of the case, and as an incident, no doubt, that added to my embarrassment as a negotiator. I was not cognizant of it, for instance, for months after the conclusion of the discussion recorded in the correspondence * |pcl9^ed by mistake in despatch No, 35.r-T. W. (see No. 9). 78 laid before Parliament in 1880 (see « China No. 2 "), in which I agreed to recommend, as an experiment, the collection of U-kin, together with TariflF duty, at the smgle port of Shanghae for a term of five years. . . - This last-named arrangement came to nothing because I could not obtain satisfactory information either as to the amount of li-kin it was proposed to collect in the first instance, or the area of exemption from farther taxation after the first payment had been made. The year 1880, though not wholly lost to trade discussion, was much taken up with matter of graver concernment. Still I continued to confer with the Chinese Ministers of the Tsung-li Yam^n, both on the subject of the general trade in imports, and of the opium trade. The formal engagement of the American Government to prohibit all participation in this trade to American citizens, as soon as I heard of it, gave me occasion to put questions regarding the possible treatment of the trade by China. The answer, which was to the effect that neither legislation in China, nor diminution of the import from India, would lessen consumption, that in the remoralization of the individual Chinese lay the only chance of Chinese recovery, I telegraphed to your Lordship in January 1881. It was read in the House of Commons by the Marquis of Hartington. The arrival of the Grand Secretary, Tso, somewhat later, proved a fresh point of departure. He is a man of undoubted energy and tenacity, and his career during the last twenty years, either against rebels within the frontier, or revolted colonists beyond it, has gained him with all Chinese of the old school a high reputation. In the two provinces of Shen Si and Kan Su, of which he was Governor-General, it was his boast that he had made a successful crusade against both poppy cultivation and opium smokers, and in one of his first interviews with me he declared that he had suppressed at least nine- tenths of the production and consumption of opium within his jurisdiction. This is not quite borne out by travellers who have recently visited those far-off districts. It is undoubted at the same time that his treatment of offenders against his interdict was rigorous in the extreme. • His Excellency appeared to me none the less to approach the opium traffic on its fiscal rather than on its moral side, although the latter occupied, indeed, the more advanced place in his argument. He denounced the trade in the severest terms ; "but while insisting, as most Chinese statesmen, when speaking of opium, do insist, that extinction of the foreign trade in opium must precede extinction of the native trade in it, and that to this end such taxation must be laid upon it as will render its price ail but prohibitory, he cer- tainly let me see that he was not indifferent to the revenue which, with high taxation, he hoped might be derived from it. The fair thing, he argued — and it is not a new argument in China — the fair thing, on the part of the Indian Government, would be to divide its enormous profits on the opium sales with the Chinese Exchequer, share and share alike. And while affirming stoutly that as the trade had been put down in his jurisdiction, so it might and should be put down in all provinces of China, he more than admitted that native opium was regularly taxed. " Would such and such an arrangement regarding Indian opium work?" I asked his Excellency. " By no means," he replied; " we should then lose the revenue on native opium." I am here summarizing very briefly what fell from the Grand Secretary Tso on more than one occasion, before the reappearance on the scene of bis distinguished colleague the Grand Secretary Li, who paid a visit to Peking in the month of May 1881. By their own invitation I met the two great Ministers together at the Tsung-li Yamen, when his Excellency Tso, repeating much that he said before, proposed as a uniform rate of li-kin the addition of 120 taels to the Tariff duty of 30 taels. This, I was informed) was an abatement; he had originally proposed 150 taels li-kin.- We did not meet after this. His Excellency addressed a Memorial to the throne, in which he represented me as having shown great impatience and shiftiness. He allowed his paper to appear in one of the Shanghae native journals. I thought it right to challenge some of his statements about myself. 1 inclose copies of our correspondence, also a translation of his Memorial more carefully prepared than that which has been pubhshed in the native prints.* It is noteworthy that in this Memorial he speaks of the rate of 40 tales U-kin originally proposed by me as but a slight rise upon the rates of collection already ruling. In the Chefoo Agreement, be it rememberedj I had only tried to secure to China what she was receiving on opium. His Excellency Li proved less exacting. He began, however, with a rate of 120 taels; this he subsequently reduced to 110 taels. * Copies of correspondence (Nos. 7-9) with the Grand Secretary Tso have been left in Pekins, and will be forwarded by the next mail. " 79 I was much pressed to name a rate myself; I declined. If it rested entirely with me, T said, admitting, as I did, that we owed China something under the Chefoo Agreement, I should be for an increase of the Tariff duty by one-half, the native Coliectorates being left, as in time past, to get in the li-kin as they might. This arrangement, I had reason to think, would be more acceptable in the provinces than collection of a high rate of li-kin by the Customs Inspectorate. The Provincial Governments have, lawfully and unlawfully, an interest in the collection by native offices, which cannot fail to be prejudiced by the more I'egular intervention of the foreign Inspectorate. The revenue collected by the latter, again, may be said to stand rather to the credit of the Central Government, although it is not practically absorbed by it. These were accepted conclusions which were supported by the observations of the Grand Secretary Tso in my first conversation with him, when he declared that any system that might interfere with the collection inland of li-kin or similar imposts could not fail to discontent the Provincial Governments My proposal, if it could be called one, to present China with a half duty, and there an end, did not meet with much encouragement. A general doubt was expressed that Her Majesty's Government would consent to it. Some attempt was made at the same time to make light of it, although I showed that, taking the opium import of 1878 as an average, it would add 1,000,000 taels to the opium revenue receipts. A high li-kin rate secured by the foreign Inspectorate was the favourite, and had the Chinese Ministers at the conference referred to adhered to what I had privately learned was their intention, of proposing 60 taels as the uniform rate, 1 should have recommended this to the consideration of Her Majesty's Government at once. I have omitted to observe that there was an important difference between the systems previously examined and that here under discussion. We had so far been dealing with rates that were to clear opium of li-kin at the ports only, the li-kin inland being still to be collected. The rate now discussed was to clear the drug once and for all, no matter to what part of the interior it might be carried. I believed that foreign opium under these circumstances would fairly bear 60 taels ; but an assertion being made in the course of the Conference that the Board of Revenue's estimate of opium revenue was a total of 6,000,000 taels, much of which was lost by smuggling, while 10 per cent, must be deducted for expense of collection, I felt bound to argue that, supposing this estimate correct, a li-kin of 60 taels would, in an average year, secure to China her 6,000,000 taels, the 10 per cent, cost being certainly saved, for the Customs would need no addition to the staff that now collects the Tariff duty ; while, by a proper understanding with the Hong Kong Government, much opium would be made to pay duty which now never finds its way to a port. The Grand Secretary Li, returning to Tien-tsin, no further opportunity of conferring with him presented itself for a time. The Grand Secretary Tso, as I have said, sent up his Memorial advocating an extravagant rate of li-kin, to be collected withal, indepen- dently of the foreign Inspectorate, at a number of central dep6ts. His colleagues at the Tsung-li Yamen did not understand his scheme, or did not approve it. In the provinces some of the authorities, on whom the work of collecting the impost would devolve have affirmed that the scheme in question would langely increase smuggling. The next incident in this history was the self-imposed mission of Mr. Samuel an intelligent gentleman connected with money, agencies, who had paid a visit to India apparently for the purpose of examining what seemed to him the defective system of remittances still in favour with the Indian Government in its regulation of opium sales. His inquiry into this matter completed, he came on to China to obtain information regarding the opium trade, not only with this country, but with the various markets which, so to speak, flank the hue of communication. His scheme, by which, in brief England was to become the sole possessor of all the opium in the world, and sole trader both with the Chinese and other markets, appeared to me, so far as revenue was concerned, to have much to recommend it both to England and China. To the latter not only would a fixed income be secured, but with Hong Kong as a terminus, and' no more than a fixed quota of opium saleable at that or any other of the minor markets there would be secured a most complete protection against contraband trade in the drug. Mr. Samuel's object, as I understood him, was to attempt the regulation of what appeared to him a faulty system of remittances where the sale of opium was concerned He had certainly no kind of official position ; but the Grand Secretary Li, who received Mr. Samuel, without any introduction from Consul or Minister, appears to have imagined that he was invested with official responsibility. I mention this merely because his visit was productive of a singular result to which I shall come presently. Mr. Samuel's own scheme was not viewed with disfavour by his Excellency Li, any more than bv myself, to whom he communicated it a few days later. I did not immediately speak of [1238] ]y; 80 it to theTsung-li Yam^n, for I regarded it simply as the suggestion of a private specuktor, which I had no right to suppose that Her Majesty's Government would even take into consideration. • u «/r a I said nothing either, for the time, of a second proposition with which Mr. bamueJ acquainted me, but not as proceeding from himself. A Chinese of Canton had consulted him in the South upon the possibiUty of creating a vast opium monopoly, of which Hong Kong was to be the head-quarters. The projector of this scheme subsequently addressed himself to me, through Sir John Hennessy, Governor of Hong Kong. I gave it no sort of encouragement. Even if its Chinese sponsors have the capital they profess to have, I should regard their enterprise with extreme mistrust unless it were placed under foreign control in such proportions as would speedily disgust the native directors. If it were left to the latter, unused as the Chinese are to operations of such magnitude, I should look for the same unUmited confusion that unhappily besets other branches of financial administration in this country. I am further mistaken if such a reproduction of the old Go-Hong, condemned to death by the Treaty of 1842, did not find that, should it prosper, it would, like its predecessor, be made to pay a preposterously high fee for the privilege of existing at all. Nor would the fact of its establishment in Hong Kong be the smallest security against exaction of the kind, so long as the families of the Chinese interested were resident, as they must be, in*their own districts. But it is not necessary to enlarge much on this project. It has found favour neither in the provinces nor at the eapitaL Now to come to the result of Mr. Samuel's mission, as it was regarded by his Excellency Li. The Grand Secretary was forthwith urged, as I have since learned, by his foreign iadvisers, at once to use Mr. Samuel's supposed mission as a precedent, and to dispatoki independently, an Agent to India. An intelligent Chinese oflScer, by name Ma Kieh-chung, formerly attached to the Chinese Legation in Paris, was the Agent chosen, a gentleman of whose fitness for the purpose, let me say, I am fully satisfied. Had the Grand Secretary, with whom my -relations are most friendly, applied to me, I should have had the greatest pleasure in giving his Agent letters to the Viceroy of Indkb Ma-taotai returned well pleased with his reception. His prescribed object had been not only to obtain information regarding the opium trade, with a view to the regulation of the revenue derivable from it, but also to sound the Indian Government upon the practi- feaMlity of gradually extinguishing its interest in the traffic. I have atated above that it is my intention separately to submit to your Lordship some remarks upon the moral aspect of the opium question. The last-mentioned |>^Poipogition betongs properly to this, and I shall here refer to it no farther than by sequence of interpretations of Treaty rights so widely at variance with each other, that I undertook to move Her Majesty's Government to adopt the arrangements set forth in section 3 of the Chefoo Agreement. I undertook, if the Chinese Government would open certain new ports and places of call to British trade, to recommend that the area within which Tariff-paid goods were entitled to exemption from li-kin or other taxation at any port should not exceed the area of the foreign settlement at such port ; that at ports! at which 86 no settlement area had been defined, the settlement limits were to be fixed by the foreign Consuls and the local authorities. This arrangement would, of necessity, involve the exclusion of the li-kin Collectorates from within the limits of the settlements so defined; but beyond these the Chinese Goveniiuent would be free to levy li-kin on all imports not covered by a transit-duty certificate. Such was, in general terms, the rule that I proposed. There was to be one exception to it. Opium was an import on which the importer had to pay a Tariff' duty, and was free then to house it and sell it. But once the drug had passed into Chinese hands, the Chinese Government was free to impose what taxation it pleased upon it. This constituted the essential difference between opium and all other imports, and mv complaint had been that all other imports were in many places taxed just as if they were opium. A li-kiu was levied on them the' moment that they became Chinese property. On the other part, I had always admitted the right of the Chinese Government to lay what taxation it pleased upon opium, and, from the nature of the commodity, it might he foreseen that the disappearance of the li-kin Collectorates from the foreign settlements would be attended at some ports by a considerable loss of revenue. Eut, again, the action of the li-kin Collectorates within the settlements had in some instances seriously interfered with trade, which should properly have been free of li-kin. To remedy both evils — loss of revenue to China and interference with the general trade by the li-kin Executive — I engaged to move Her Majesty's Government to sanction an arrangement by which opium brought into port by a British merchant should be deposited in bond, under direct surveillance of the Maritime Customs, until sold, and that, when sold, the importer should pay the Tariff duty upon it, the purchaser paying the li-kin. The amount of li-kin levied in 1876, when the Agreement in the above sense was signed, differed at dififerent ports. I vs^as prepared to recommend the adoption of a uniform rate, but, as the Grand Secretary Li and myself were not of one mind as to the amount of this rate, it was agreed that, as had been hitherto the custom, the several Provincial Governments should levy li-kin according to the circumstances of each. As the assent of the other Treaty Powers would be required to make all the above conditions operative, I called upon your Imperial Highness to invite the foreign Legations to consider them. A Circular was addressed to the foreign Legations by the Tsung-li Yamen, but the Chefoo Agreement has remained unratified because, while the Representa- tives of the Powers objected to my proposed hmitation of the area of exemption from li-kin as insufficient, so far as the general trade was concerned, the Government of India, believing that its interests were gravely compromised, demurred equally to the provisions of the Agreement. The great increase in the cost of opium which it apprehended from these could not fail, in its opinion, to cause a serious diminution of revenue. It should not be overlooked that, even if the Government of India had not objected to what I agreed to recommend regarding opium, it was always open to almost every other of the Treaty Powers to object to my proposition ; for, although the opium imported into China comes piincipally from British India, the drug none the less figures in the Tarift" of other Powers; and it was not to be expected that any Power with commercial grievances unredressed, and in particular grievances arising out of the undue taxation of imports, would consent to a modification of Treaty which would gratuitously extinguish the right of its national to land, house, and sell the drug as his Treaty allowed. British importers of the drug did in fact immediately propose to place their opium under other flags if' the British Government were, without reserve, to ratify the Chefoo Agreement. Meanwhile, the Chinese Government had performed its promise regarding the opening of the places enumerated in the Agreement, but the difficulties presented by the clauses affecting the general trade, against which other Powers protested, and those affecting opium taxation, which had alarmed tiie Indian Government, as I have stated, deterred the Government of Her Majesty from ratifying the Agreement ; and towards the end of 1878, with the permission of the Marquis of Salisbury, then Secretary of State for Foreign Affairs, I proceeded to India for the purpose of obtaining such information as might guide me in the framing of fresh propositions. My observations led me to the conclusion that the object of Indian statesmen was not so much the extension of the opium trade as security against a falling-off of the opium revenue. Shortly after my return to China I was invited by Herr von Brandt, the Minister of Germany, to jom in an attempt to place taxation of the general trade upon a better footing The Representatives of the Treaty Powers assembled in Peking for this purpose in the autumn of 1879, and this question has formed the subject of various Conferences throu^-h - out the last two years. ° The taxation of the export trade having been, by common consent, committed to the care of the Minister of Germany, the import trade was placed in my hands. The object 87 of my colleague and myself alike has been to arrive at some understanding with the Tsung-li Yam^n, which, being accepted by all the Governments, as calculated to secure foreign trade against loss, might, at the same time, put an end once and for ever to angry discussion. On the taxation of the general trade, import or export, I shall here add but one word. As I have stated from the first, in my conferences with the Tsimgli Yamfen, a definite agreement regarding opium taxation, to be securely operative, must be accompanied by a definite agreement regarding the taxation of trade in general ; because, until the latter question be disposed of in terms to which other Powers agree, it is in their power to render nugatory any arrangement specially regarding opium which Her Majesty's Govern- ment may separately have consented to adopt. And we are still some distance from a definite agreement that will be deemed satisfactory. For the moment, however, I confine myself to the opium question, pure and simple. Shortly after the recommencement of the discussion, it was proposed by the Tsung-li Yam^n that the arrangement affecting opium taxation, which I had promised in the Clicfoo Agreement to recommend, should be tried for five years at Shanghae. I reported this proposal to my Government, but I could not give it more than a qualified support ; for, from the information within my reach, it appeared to me probable that, without a clearer understanding than I could arrive at, li-]iin collectorates would be multiplied round the port, to the derangement, not only of the opiun; trade, but of other branches of commerce. The taxation of opium, therefore, has continued under the conditions formerly obtaining, except that at one or more ports the rate of li-kin has been raised by the local authorities. In the course of the present year a number of schemes have been brought forward from different quarters. Indeed, including the arrangement contemplated in the Ghefoo Agreement, and the modification of this above cited, which would have restricted operation of the clause to Shanghae for a stated period, there are, perhaps, a dozen proposals at this moment before us. There is, ■ first, the scheme of Mr. Samuel, an English gentleman, who, in his capacity of a financial agent, has had occasion to devote some attention to the opium revenue of India. In prosecution of inquiries that he desired to make, he came on to China, by way of India, last summer; Mr. Samuel's idea, in few words, was to make the British Government sole pi'oprietor of all opium produced in the world, to supply all the opium markets outside China with a certain limited quota of drug, to deposit all drug in excess of these quotas at Hong Kong, whence it was to be passed, according to the estimated requirements of the open ports, into China, under surveillance of the Maritime Customs, the purchaser paying into the Customs at the same time both the Tariff duty and a fixed rate of li-Min. Opium imported into China under these conditions would have nothing further to pay as taxation, and the sole market of the purchaser being in reality at Hong Kong, the amount of duty to be imposed upon it would be exclusively the affair of England and China. I did not bring this scheme to the knowledge of the Tsung-li Yam^n, because Mr. Samuel had not been invested with any oflicial authority ; but I reported it to my Government as a scheme that appeared to me worth examination. It has been examined at the India Office, but no decision has as yet been pronounced upon it. The next project was a native monopoly. While Mr. Samuel was in the south of China he had some communication with certain Chinese of Canton, who desired to form a Company for the sale of opium in China. Their head-quarters were to be, I believe, in Hong Kong. Their capital was affirmed to be consideirable, and they were ready' to guarantee to the Chinese Exchequer a large amount of revenue in exchange for the exclu- sive right to sell opium in China free of all taxation inland. They have since prayed the support of the Government of Hong Kong, and their petition has" been forwarded by the Governor of the Colony to me. I have given it no encouragement. The value of the opium imported annually into China is some 40,000,000 taels ; the revenue of the two countries, China and India, is largely concerned in the trade, and I have doubts whether, even if the amount of the capital of the Company be not overstated, it would be safe to intrust the conduct of so vast an enterprise to a local association. Its operations, it appears to me, would, at least, have to be controlled bj' competent official authority. To proceed. When I returned to Tien-tsin last month I had communicated to me two other schemes, which also undoubtedly merit attention. The first is that the Chinese Government should virtually become proprietor of all British Indian opium for a term of years, to be fixed by common consent, the Government of England engaging that the production of opium in India shall be gradually reduced during that term, and [123«] 2!f 88 that, on the expiry of the term, the export of opium from India shall wholly cease. The price to be paid per picul to the Indian Government would be hxed, either once a-year or at longer intervals, bv agreement, and the payment agreed to would be made either at Hong Kong or in India, as might be agreed, and either through an official agency or a ^"''' These, Tfhave not misunderstood the Grand Secretary Li and the Tao-tai Ma, are, more or less, the conditions lately submitted to a high officer of the Indian Government by the Tao-tai Ma, who, by order of the Grand Secretary Li, had proceeded to India on a private mission to obtain information regarding opium. , , • ^ j j-.- The second scheme is little more than a modification of the above, the chiet addition of importance being the provision of a means of payment of the revenue promised to the • Government of India during a term of years in consideration of the engagement, should it be accepted, to extinguish its interest in the opium trade within that term. The scheme would work thus :— An official Agency, representing both Governments, being established in Calcutta and Bombay, would buy all opium leaving India for China. Cheques for the estimated value, at a rate agreed to, drawn on a stated bank also duly appointed to act for both Governments, would be handed by the Agent of the Chinese Government to the Agent for the British Government. These cheques cashed, the Treasury of India would claim no farther interest in the opium exported. The opium would be consigned to a second official Agency established at Hong Kong, in whose keeping it would remain until it might be sold in Hong Kong or at the ports ; the price charged covering the advance of the bank in India, plus the duty imposed upon the opium by the Chinese" Government. The Agency, as the sales were effected, would repay the bank the money paid by it to the Government of India; the bank necessarily retaining a lien upon the opium deposited at Hong Kong until the completion of these sales. This is the substance of an arrangement laid by a foreign agent before the Grand Secretary Li, and communicated to me by his Excellency. There remain to be noticed the proposition of the Grand Secretary Tso, who would levy, in addition to the Tariff duty of 30 taels collected by the Maritime Customs, a uniform rate of 120 taels, that is to say, a total sum of 150 taels ; and the kindred proposi- tion of the Grand Secretary Li himself, who would fix the li-kin rate at 80 taels, in addition to the TarifF duty, would levy, that is to say, a otal of 1 10 taels ; the whole in this case to be collected through the Maritime Customs. These propositions were brought forward by the Tsung-U Yamen last summer, and while I was at Tien-tsin the Grand Secretary Li forwarded me a Memorandum in three Articles regarding the collection of the impost should his own proposal be adopted: — 1. The sum of 110 taels being collected at the port of entry by the Maritime Customs, opium is to be thenceforward free of all charge whatever, and any official found to be levying li-kin upon it is to be punished. 2. All opium brought from India being deposited at Hong Hong, an official Agency of the Chinese Government is to be estabhshed at Hong Kong for the purpose of surveil- lance, the Government of India and the Government of Hong Kong being instructed by the Government of Her Majesty to keep this Agency informed of the shipment and arrival of the drug, the duty on which is to be collected either at Hong Kong or at the ports to which it is consigned, according as the Hong Kong Government and the high officer at the head of the Chinese Agency shall agree. The Governments of India and Hong Kong are to engage to do all in their power to prevent smugglirig. 3. These arrangements are to be tried under provisional regulations. When the sanction of the Governments of England and China shall have been given, the Opium Clause of the Chefoo Agreement is to be cancelled. As regards the establishment of a uniform rate, I have been at some pains, in past discussions, to prove that a li-kin of 50 taels being added to the Tariff duty, the Chinese Government would receive a larger sum than the total of its revenue on foreign opium as at present estimated. In a Conference held last May at the Tsung-li Yamen, in which, I think, the Grand Secretary Li himself took part, the Ministers present maintained that the opium revenue was estimated at 6,000,000 taels ; but from this they allowed that there would have to be deducted a charge of 10 per cent, for expense of collection, while it was farther admitted that the duty on no small amount of opium that ought to pay duty was evaded. Taking the import of the year 1878 as an average year, I pointed out that with a charge of 50 taels li-kin, plus 30 taels Tariff, per picul, the exact sum of 6,000,000 taels would be attained ; that as this, if the provisions of the Chefoo Agreement were to be abided by, would be paid through the Maritime Customs, the expense of collection, as at ,jpresent conducted through the opium li-kin offices, would be saved. Lastly, that by an 89 understanding with the Government of Hong Kong, not only might evasion of the li-kin at other places be rendered impossible, but revenue might be collected on a great deal of opium that now never reaches the open ports at all. I have argued that, when the Chefoo Agreement was signed in 1876, no higher li-kin than 40 taels was exacted at any ports except Foochow and Amoy, at which ports, precisely because the li-kin rate was so high, the import was comparatively small. The country in rear of these ports was supplied from other quarters, and at these ports them- selves much of the li-kin due on the opium imported was admittedly evaded. At some ports, again, the li-kin in 1876 was considerably below 40 taels. Against this the Grand Secretary Li has upheld that the rates I refer to were merely the rates ruling at the ports of entry, and that I have overlooked the inland taxation of opium. I do not forget the liability of opium to inland taxation, but I am satisfied from the testimony of Chinese officials and Chinese of business experience, that once an article so easily concealed as the foreign drug begins to travel inland, its further taxation is but imperfectly assured, and consequently insignificant. Unless 1 am misinformed, in many provinces the opium, after passing the first li-kin coUectorate, is franked by a particular badge or ticket throughout the province. I have therefore urged, and I still hold, that a uniform rate of iO taels li-kin per picul, even were no larger quantity of opium to be imported annually than in the year 1878, would raise the revenue on British Indian opium not only to 6,000,000 taels, the Tsung-li Yamen's estimate of what it is entitled to receive, but to a considerably larger sum. I do not myself believe that the Chinese Government has ever received 40 taels li-kin per picul, and I can'not but regard the proposal made last summer to recommend Fler Majesty's Government to agree to a fixed rate of 50 taels as exceedingly libferal. After much debate at Tien-tsin, I had, however, consented to propose that the rate be fixed at 60 taels, but the Grand Secretary Li still pressing for an advance upon this amount, I did at least promise to recommend that a rate of 70 taels be agreed to, provided that certain conditions important to the general trade be satisfied. Of these conditions I shall have more to say in due time ; but first, in order finally to dispose of the taxation of opium, I must record an alternative proposal of the Grand Secretary Li : the augmentatioii, namely, of the Tariif duty now levied by the Maritinie Customs at the. port of entry, the collection of li-kin being left, as in time past, in the hands of the native collectorates. I had in effect myself suggested the possibility of such an alternative when the Grand Secretary was in Peking last summer, but purely as an idea of my own, which I had not been authorized by my Government to put forward ; and I had mentioned 1.5 taels, that is an additional, half duty, as the amount of increase that I could name to my Government as reasonable. The Grand Secretary Li proposes, if the new methods of collecting li-kin he not sanctioned, that the Tariff" duty be at least doubled, that is, that" an addition of 30 taels be made to the present Tariff' duty of 60 taels. After much debate I promised to recommend an addition of '20 taels in lieu of the 15 taels addition that I was earlier prepared to support, a total Tariff' duty, that is to say, of 50 taels in lieu of the present duty of 30 taels, the li-kin on opium at the ports or inland being of course collected in the old way. But again this counter-proposition is no more than a suggestion of my own, which I undertake to submit to my Government for consideration. 1 have received no authority whatever to put it on its trial ; and so of every other proposition regarding the opium revenue. The adoption or rejection of this measure or that must depend in the first instance upon Her Majesty's Government, and in the case of the greater number of schemes now propounded the consent of other Governments will be also indispensable. If the Governments of England and China determine to adopt the scheme of Mr. Samuel, by which the former Government would become sole purchaser and distributor of opium ; or the scheme of the Canton monopoUsts ; or the scheme sketched under authority of the Grand Secretary Li, by Ma Taotai, which would make Hong Kong the head-quarters of the sale and distribution of 'opium, a fixed rate of li-kin being assured to the Chinese Government ; or the modification of this scheme, by which a Chinese agency would purchase all opium in India at a fixed rate of value, the Chinese Government reserving to itself the regulation of the amount of any further charge — in each and all of these cases the two Governments would be free to act together, independently of the opinion of any third party. But to the acceptance of any of the other schemes that have been spoken of, the acquiescence of other Governments is essential. This observation appHes equally to the Opium Clauses of the Agreement signed at Chefoo in 1876; to the limitation of these to the port of Shanghae, as proposed by your Imperial Highness in 1880; to the proposition of the Grand Secretary Ij to levy a li-kin of 80 taels with the Tariff duty of 30 taels through the Maritime Customs ; to the alterna- j'1238j N 2 90 tive propositions of his Excellency Li to substitute an increase of the Tariff for the customs levy of the higher rate of li-kin ; lastly, to my own proposal to recommend a li-kin of 50 taels, or an addition of 20 taels to the present Tariff. The proposition of the Grand Secretary Tso to levy a li-kin of 120 taels upon opium, to be levied by the Chinese authorities independently, is not included in the above list ; but with reference to any other of the schemes enumerated, it may be observed that the Government of China would find itself obliged to obtain the consent of the other Treaty Powers to any change that had simply the approval of Her Majesty's Government. 1 am not of opinion that it would be so hard to obtain their consent. The foreign opium imported is almost exclusively produced in British India, and I cannot suppose that any Treaty Power would decline to concede any modification of the provisions affecting opium that had been accepted by the British Government, if only the complaints regarding undue taxation inland, with respect to which all the Powers alike make common cause, were redressed. These complaints, it appears to me, will have to be redressed; and anxious as 1 am to support any measure that may terminate discussion of the opium question, I should think it my duty, when reporting the measure for which the Chinese Government may declare its preference, to recommend that a settlement of the other question, the taxation of the import and export trade inland, be made by Her Majesty's Government a condition of the acceptance of any arrangement affecting opium. The Grand Secretary Li objects that this will retard the settlement of the opium question. T entertain no such apprehension. But in any case I feel bound to pursue this course. The third section of the Chefoo Agreement was negotiated, not because the taxation of opium directly called for negotiation at all. What I had in view was the adjustment long called for of the taxation affecting all trade other than in opium. The reference to opium is due simply to this, that as adoption of the proposals I made would have occasioned a loss of the revenue due on opium to China, I volunteered certain other proposals which might protect China against that loss. I have now been co-operating for two years with the Representatives of other Powers in conferences with the Tsung-li Yam^n regarding the general trade, and 1 do not consider myself free, without consulting them, to take a line of my own. If hiy meaning be not plain to your Imperial Highness, a single interview with the Ministers of the Tsung-li Yamen will, I am confident, suffice at the same time to convince them that I do not for a moment abate my desire for such a termination of the opium discussion as will ber^atisfactory aUke to the Government of China and to my own. I refer, for the moment, simply to the revenue derived by each from the trade in opium. Should the arrangement accepted by both be of such a nature as to bring about an eventual extinction of the trade, no one will be better pleased than myself. If during this long discussion I have dwelt rather on the financial than the moral interest of the opium question, it is because I am convinced that so long as the opium produced in China is sufficient to supply the needs of the Chinese, the reduction of the quantity of opium imported, or even the total exclusion of foreign opium, will not remorahze the opium smoker. Nor is this conviction exclusively mine. It is held as firmly by many Chinese of the highest standing. It is easy to assert that as no Government but the British Government imports opium into China, and the Chinese suffer morally and materially from opium smoking, the evil done to the Chinese smoker lies in consequence wholly at the door of the English. If it be true that the drug was first imported into China by the English (which is disputed), the quantity even now imported into China is far too small for the consumption of more than a very limited number of consumers. The wants of the majority are supplied bv opium manufactured from the poppy grown on Chinese soil. In the western provinces of China, from north to south, British Indian opium is not to be met with, while in every place the native opium is manufactured and taxed. It is useless to complain of the conduct of England or of any other country, so long' as this state of things is allowed to continue. But 1 will pursue the moral question no further. When I have ascertained which of the numerous schemes that are now before it has the preference of the Chinese Govern- ment, 1 shall without loss of time submit it to Her Majesty's Government. In a late conversation with the Grand Secretary Li, his Excellency expressed a hone that it either of the schemes that would involve establishment of Agencies in India or at Hong-Kong were accepted, no objection would be opposed to the appointment bv the Chinese Government of foreigners in whom it had confidence, to assist the Chinese chiefs or members of such Agencies. At Hong-Kong his Excellency Li appeared to think it mio-ht be desirable to station a Chinese " Wei Yiian " and a member of the Customs Insnec torate. ^ 91 A full reply upon any of these points being beyond my powers, I could only assure the Grand Secretary that so far as I was personally concerned 1 saw no objection whatever^ to any arrangement of the kind, that 1. should not hesitate to state this impression to Her Majesty's Government, and that when making my report to Lord Granville, his Excel- lency might count upon my cordial advocacy of the proposition. The Grand Secretary has further put the question whether, in the event of the Government of India agreeing to any arrangement under which the taxation of the opium trade would be exclusively left in the hands of India and China for thirty years, this arrangement might not be set aside a few years hence by a successor of the present Viceroy of India ? Should any arrangement of the kind indicated be agreed to, it will become, I presume, the subject of a Convention of some sort between the Governments of England and China, and I trust that it is not necessary to assure your Imperial Highness that conditions agreed to by Her Majesty's Government, no matter in what form, are certain to be faithfully abided by. I renew, &c. (Signed) THOMAS FRANCIS WADE. luclosure 3 in No. 1 1. Sir T. Wade to the Prince of Kung, Sir, Peking, January 14, 1852. THE note which I had the honour to address to your Imperial Highness under yesterdaj's date regarding opium taxation, has taken longer to prepare than I anticipated. The text, nearly as it stands, was shown to the Grand Secretary Li at Tien-tsin, and his interpreters prepared a translation which his Excellency was so good as to communicate to me. On my return here, however, I found it necessary to go once more through the papers affecting the opium question, and this and the reconstruction of the text in some places has occasioned a delay for which I feel it my duty to apologize. Just as I was dispatching it to your Imperial Highness, 1 was informed of a report prevailing at Tien-tsin and Shanghae. to the effect that the propositions laid before the throne by the Grand Secretary Tso last summer had been approved by the Chinese Government. This is, of course, a mere report, but I feel none the less bound to observe that, if it be true, I foresee considerable difficulties in the way of a settlement of this question. I have, &c. (Signed) THOMAS FRANCIS WAD^. Inclosure 4 in No. 11. The Prince of Kung to Sir T. Wade. (Translation.) January 25, 1882. THE Prince of Kung makes a communication in reply to the British Minister. The Prince is in receipt of the British Minister's note of the 25th of the 1 1th moon of the 7th year of Kuang Sii (1 4th January, 1S^2) to the effect that in dealing with the opium question, the adoption of Mr. Samuel's scheme of the monopoly proposed by the Cantonese Company or the scheme proposed by Ma Taotai, when he proceeded to India to inquire into the practicability of establishing a general Ageacy, would be exclusivelv the affair of the Governments of our two countries, but that as regarded the proposition of the" Grand Secretary Li to levy a li-kin of 80 taels to be collected at the same time as the Tariff duty by the foreign Customs, or (as an alternative) to increase the present Tariff duty by 80 taels, leaving the li-kin to be collected as heretofore at the ports ; the propositions which the 13ritish Minister would submit to his Government either to autUorize a U-kin of 70 taels, or an increase of 20 taels to the Tariff^ or the proposition lying outside all these, of the Grand Secretary Tso, to levy a total li-kin of 120 taels at the ports and in the interior, each of these would involve some modifications of the Treaties of other Governments; but that it was not likely if the Government of China were at once to remove the abuses affecting the taxation of imports and exports, that other Governments would offer any opposition to such arrangements as the British (jrovernment might accept with reference to opium. The British Minister now waited to be informed which of the propositions above enumerated was most in accord with the wishes of the Chinese Government, in order that he might submit it to his own. 92 'The Tsiiilg-li Yamgn woald observe that, of the arrangetiients above enumerated, that tindet' which the li-kin and the Tariff duty are to be collected together is doubtless one that may be considered (may form) a basis of negotiation. There is, at the same time, an immense difference between the sum of 70 taels, which the British Minister proposes should be added to the 30 taels Tariff duty, and the addition to the li-kin which the Chinese Government proposes to make. The proposition stated by the Grand Secretary Li, in conference with the British Minister, was that 80 taels li~kin should be levied, in addition to the 30 taels Tariff duty — a total sum, that is to say, of 110 taels ; and this it fe not found possible to reduce (or, "and this it is found cannot properly be reduced ")• The estimate, therefore, action upon which is to be considered in order to a satisfactory conclusion is certainly that presented by the Grand Secretary Li.* As regards taxation of import and export produce, the Representatives of the different Powers having addressed the Yanien communications on the subject, negotiations ensued between the Yamen and Herr von Brandt, Minister of Germany, and the British Minister. But this was before the opium question was taken into consideration. The ne^jotiations (on the general trade) having now reached a certain point, there will be no difficulty in dealing with each (of the two parts) separately, and pursuing discussion deliberately to conclusions of common advantage. This is a matter apart, and not to be connected in its treatment with the opium question." The Yam^n is most anxious to come to an understanding with the British Minister upon the latter subject, and to take action upon it as soon as possible ; and what is really to be feared is this, that if fresh obstacles defer this solution for ^ny great length of time, the Chinese Government may of itself t raise the rate of li-kin to 150 taels, as originally proposed by the Grand Secretary Tso, or may devise some other measure, such as the establishment of a Guild or a general Comniittee. There is no telling. Being in receipt of the British Minister's observations,! it is the duty of the Prince to reply. Inclosure 5 in No. 1 1. Sir T. Wade to the Prince of Kung. ^r> Peking, January 28, 1 882. I HAVE the honour to acknowledge your Imperial Highness' note of the 25th instant. The reasons which make opium taxation and taxation of other branches of foreign trade Inseparable questions have been so fully set forth not only in my note of the 13th instant, but on several previous occasions, that I shall not occupy your Im.perial Highness' time with a repetition of them. The discussion of the opium question did not follow, as your Imperial Highness believes, it preceded the discussion of the other questions. It began, in fact, from the day I rejturned here in 1879, and has continued ever tince. As to the threat, for so I must i-egard it, that the Government of China may be obliged to take the collection of opium li-kin into its own hands, I must observe that it has always had the collection in its own hands, and that it has it at this moment. At the single port of Shanghae, indeed, the li-kin Collectorate, at the instance of Herr von Brandt, was removed from within the settlement, but the Collertorate none the less exists on its very borders, and at every other port the li-kin Collectorates stand where they have been used to stand. It is because under these conditions a large amount of the opium revenue escapes the collector that the co-operation of Her Majesty's Government is needed. Her Majesty's Government is willing to co-operate, but, as I have been careful to remind the high officials of the Chinese Government Vv-itli whom I have been in com- munication on the subject, Her Majesty's Government will certainly reserve to itself the right of deciding to what extent it will accord its assistance, whether as regards collection of li-kin with the Tariff duty, or an increase of the Tariff", or by adoption of any other proposition. I have, &c. (Signed) THOMAS FRANCIS WADE. * By the constractian the difficulty of reducing it appears laid upon the Grand Secretary L 'it- ^ ''*^'^' ™^^"'"S without further consulting the British Government. X I his, though in appearance curt, is rendered with all dtie courtesy ih Chihesfe 93 Indosure 6 in ISo. 11. 7%e Prince of Kung to Sir T. Wade. (Translation.) Fehruary 2, 1883. THE Prince of Kung makes a communication in reply to the British Minister. The Prince is in recsipt of the British Minister's note of the 28th ultimo on the giubjeet of the duty and Zi-fciw on foreign opium. The British Minister observes that the passage in the Prince's note, to the effect that China may possibly take upon herself to increase the rate of li-kin, or may, single handed, resort to some other scheme, is in the nature ol a threat; that a large amount of the opium revenue escapes the Chinese collector ; and that the British Government is quite wilhng to offer its assistance ; but that the form in vvbicli such assistance is to be afforded, whether by a levy of li-kin and duty in one and thesame payment, or by an increase of the regular Tariff duty, or by some other measure^ rests wholly for the British Government to determine. Referring to the proposition for tjie simultaneous collection of duty and li-kin which the Prince's note had stated to be the preferable one, the British Minister remarks that he has already submitted it to the consideration of bis Government by telegraphic despatch on the 18th January, as feeing the project which seemed most satisfactory to the Grand Secretary Li. On receipt pf a reply from his Government, the British Minister would write for the information of the Prince, The Prince would observe, in reply, that the passage eontsined in his former note, " if, after all, the proposition to collect li-kin with the Tariff duty be not adopted, C^ina may take it upon herself to increase the li-kin, or to devise some other scheme," was a simple declaration to the effect that, inasmuch as China cannot but be anxious to promote the security of [her revenue on] opium, if protracted negotiations to that end lead to no result, it will not be in her power to throw [the whole question] aside, and give it no further heed. There was no intention to employ a threat. The Grand Secretary Li's preference for the simultaoeous collection oi li^in^ud Tariff duty was entirely in accord with the Yam^n's selection of the project which appeared to them most satisfactory in the British Minister's note, and it is hoped that tfee British Minister will inform the Prince as soon as a reply to his telegram on the su*bject shall be received, in order that the matter may be taken into consideration as soon as possible. A necessary reply. No. 12. Sir T. Wade to Earl Granville. — {Meceived August 3.) My Lord, • Tien-tsin, June 3, 18S# IN the preceding despatch I sketched the slow progress of the discussion, commeoced in September 1 876, of the question of opium taxation. Briefly to restate the case which demands a decision at the hands of Her Maj^y's Government, in 1876 I pi-oposed at Chefoo that, the li-kin CoUectorates being excladied from the port settlements, within which the Chinese Government was undoubtedly free to levy li-kin on opium, the li-kin which must otherwise be lost to the Chinese by this exclusion of CoUectorates should be secured to them by retention of the opium in boud until it was wanted for sale. The foreign Customs Inspectorate was then to collect the li-kin from the purchaser of the drug as it passed out of bond. The rates of li-Un iheiog different at the different ports open to trade, I was in favour of the establishmieiit of a uniform rate. The average of li-hin per picul laid upon opiusH at the time I had reason to beifeye was little more than 30 taels. The Grand Secretary Li p»@posed, as the umiforai rate, a li-kin of 90 taels, at the port, be it remembered; that is to say, independently of amy farther taxation that the opium might become liable to in the interior. To this I ojbjectHl and his Excellency reduced the rate gradually from 90 taels to 60 taels. But this still appearing to me excessive, I undertook to recommend, in the terms of the Agreement, that the amount of li-kin to be collected should be decided, as heretofore, by the difoent provincial Grovernments, lacoording to the circumstances of each. This recommendation alarmed the Government of ladJa, as exposing omam. to a weight of taxation which might seriously interfere with IndiaJi -rerenue. It is still my inipression that, had my arrangement been allowed to taike effect ev.en for a term of probation, the fears of the Indian Government would have proved uafounded. But I.cottld not say the same at this moment weue the i(3overjUMen,t of India to 4eeide 94 upon adopting the provision of the Chefoo Agreement just as it stands. The alarm has been sounded, and some leading statesmen in China would not improbably attempt the taxation of foreign opium at rates that might endanger the life of the golden goose. When the Agreement was negotiated, I thought myself entitled to rely on the discrimina- tion 1 had seen exercised in the treatment of opium at most, if not all, of the open ports. The li-kin was excessive at only two ports. At some but a light weight, a very light weight, was laid upon it. At some, where the native drug was completing, the li-kin rate on the foreign drug was kept purposely low. I would not answer now for tlie discretion of the authorities at all points, if no uniform rate were prescribed them. They might in due time, no doubt, perhaps in a very short time, discover the error of their ways, but I cannot but suppose that, while they were acquiring the necessary experience, the trade in opium, not to say the general trade — and in this opium plays financially an important part — would be suffering in a fashion that the Indian Government might have had occasion to deplore. It is naturally not without some reluctance that I abandon the arrangement to which I agreed, if, indeed, I did not suggest it, at Cheefoo in 1876. But I conceive it my foremost duty, so far as opium is concerned, to consider by what means, so long as the trade in it lasts, the revenue derivable from it may be best secured on both sides, to China as well as to the Indian Government. The danger against which precaution is chiefly called for, as much on one side as the other, is, in my opinion, uncertainty of treatment: taxation of opium on the principle of seeing how much it will bear. The echo of the anti-opium movement in England has had, no doubt, a certain influence in this direction. " When you yourselves condemn the trade as immoral," a Chinese will observe, "why not leave us free to tax it as we please." The plea for extraordinary taxation, as urged by such statesmen as the Grand Secretary Tso, is that, by high taxation the trade in foreign opium will be strangled. I am reserving my reply to certain arguments in favoui- with those who demand the immediate extinction of the trade on moral grounds, for statement elsewhere. Admitting for the moment the sincerity with which the vice of opium-smoking is proscribed by iiis Excellency and others, that in his case, at all events, the hope of extracting, meanwhile, a large revenue from the trade is for something in his policy, I hold proved by what 1 have quoted in the foregoing despatch from his own lips. I should be delighted to assist the Chinese Government in obtaining from the opium trade, so long as it lasts, the largest amount of revenue possible, but I am convinced that, under the direction of a man as tenacious and, at the same time, so little acquainted with the conditions of foreign intercourse, the revenue of China would suffer. This was the opinion spontaneously expressed by more than one Chinese official as soon as his famous Memorial appeared last year. Such a rate of duty as he proposes will prove an incentive to smuggling, it was remarked. The very suggestion of such a rate h|jd an immediate effect upon the trade in opium, both native and foreign, to the serious disturbance of other trade. Dealers hastened to accumulate stocks, to the extreme inconvenience of the money market. I should view with the greatest concern any measure that would enable an official, as energetic and self-willed as the Grand Secretary Tso, to dictate his own terms in opium taxation. And he would be more or less in a position to dictate his terms, unless some definite rule were laid down by the Central Government ; for, by his recent appointment to the Superintendency of Southern Trade an appointment usually, as in this instance, conferred on the incumbent of his post, the Governor-Generalship of the Two Kiang — he would exercise, iu all that regards foreign commerce, no inconsiderable dominion over the provincial Governments of the south, the provinces which most largely consume foreign opium. The Grand Secretary is personally popular with the large majority whom we should style the ultra-Conservatives of China, and who, his popularity apart, would approve a financial policy such as his. At the same time, a check upon his influence has been removed by the obligatory retirement of his less popular, but far more experienced, rival, the Grand Secretary Li. ' In the interest of the stability of the opium revenue both of India and China, I am entirely opposed to any arrangement that will commit it to a direction which, I cannot but fear, would be found perilously capricious. The foremost requirement to be satisfied being, in my opinion, security against distur- bance, I earnestly advocate acquiescence in the proposal that a uniform rate of li-kin be levied, and levied under whatsoever system it shall be agreed between the two Powers will satisfactorily secure both against loss. The decision, I imagine, will be between two methods of collection. Either the Chinese Government will engage the services of an agency, be it native, foreign, or mixed duly guaranteed, to collect their revenue, in which case the co-operation of the Govern' ments of India and Hong Kong will have to be solicited; or it will entrust the duty to the 95 Foreign Customs Inspectorate, who, so far as its functions on land are concerned, need not increase its staff by a single man ; but who would have to add very considerably to its preventive service afloat; this reinforcement being so much off revenue. Any rate named, again, would have to be agreed to by, not only the British Government, but by every Treaty Power, except Kussia, America, and Brazil. By a Decree published, I believe, in 1836, the Emperor Nicholas forbade participation in the opium trade. The prohibition has been renewed, with reference to the frontier, in the Russian Treaty signed last year. The United States have engaged neither to trade in, nor to carry opium, in the Treaty negotiated at Peking the year before last. Brazil has accepted the same engagement in its Treaty just ratified. In both the last instances the Chinese Government proposed the stipulation, not, I am persuaded, in the belief that it was a step towards the extinction of the trade, but because the withdrawal of other foreign Powers, which point, it was hoped, might one day be attained, would deprive England of an argument which I have used, I need hardly say in perfect good faith, in favour of a satisfactory settlement of the question of taxation of the general trade inland. Although India is the chief field of opium production, it has been repeated ad nauseam, every Treaty Power, except the three above named, still keeps opium in its Tariff, and is free to claim for its merchants the right to import, house, and sell opium, without payment of a penny more than the Tariff duty of 30 taels. It follows, therefore, that supposing the Chinese Government, unable to adopt any scheme, such as that I believe it to be at this moment considering, a scheme that would possibly make it independent of other Governnients, it will fall back upon the joint collection of Tarifi" duty and li-kin by the Customs Inspectorate. It will then first have to agree with Her Majesty's Government as to the amount of the rate to be agreed to ; then, to induce the other Treaty Powers, who have not deprived themselves of the right to trade in opium, to adhere to the arrangement accepted by Her Majesty's Government. I was in hopes, some time since, that the taxation of trade question was nearer solution than it proves to be. I shall not here say more. I do not despair of a solution, and its postponement notwithstanding, I feel I am no longer at liberty to defer transmission of the Report so frequently promised. Assuming it to be as likely as not that a uniform rate will have to be named, it is on the point of its amount that I beg now to urge Her Majesty's Government to decide. In the interest of the Indian Government I support a liberal rate. Believing that the Chinese Government, though entitled to more, never did really receive more than 40 taels li-kin a picul, while en some 20,000 piculs it received nothing at all, I considered that a rate of 50 taels on all opium brought to Hong Kong, the quality heretofore unaccounted for paying equally with the rest, would have been worth its acceptance. After two years' incessant debate, I have found 60 taels, the minimum offer which, in any responsible ofiBcial's opinion it would be worth the while of the Chinese Government to close with. I believe that this would have been assented to last summer had I named it. But in face of the Grand Secretary Tso's sweeping propositions, and the averment, on the other l!de, that the opium revenue was estimated at 6,000,000 taels, less expense of collection and loss by smuggling, 1 declined to go above 50 taels. The late addition to the 60 tael rate of 20, but since reduced to 10, taels, is a concession, I am persuaded, to the Grand Secretary Tso. It must be for Her Majesty's Government to decide which rate, if any, it will consent to. Sir Robert Hart contends that the drug will bear 90 taels li-kin, a total burden that is of 120 taels. I cannot suppose that so large an increase of taxation would not injuriously affect the revenue of India. I think 70 taels, nay 60 taels, a liberal rate, and the greater the benefit secured to the Chinese Government from this impost, the more secure, in my belief, will the revenue of India be from disturbing action on the part of the Chinese Government. As regards the Chefoo Agreement, it must be borne in mind, as I have mentioned before, that the high rate proposed when this was signed was to have cleared opium at the port only. Inland of the port, it would be impossible to say how soon, a native Collectorate would have been free to tax it. It is at the port of import, of course, that its taxation is of chief importance. Of all merchandize opiujn is the most easily smuggled in small quantities, but the larger consignments would not similarly escape any charge to which they might be liable on an inland route. The uniform rate now proposed once paid, the Tsung-li Yamen is prepared to guarantee exemption of the drug from all further taxation of any description. The security for fulfilment of this promise appears to me very simple ; an under- standing that, if it be not kept, we return at once to the conditions of the Treaty of 1858. I have not the slightest apprehension of a counter-movement ; of a retaliatory interdict suddenly laid upon the trade. The Chinese Government knows that it would be utterly [12-81 O 96 futile. On the other part, the power of diminishing the revenue, if faith were broken, is entirely in our hands, and the Chinese Government,! feel sure, will not lightly cast away an increase of income, at the lowest, of from 2,000,000 to 3,000,000 taels. Whatever arrangement be eventually consented to will, I presume, take the place ot that recommended in the Ohefoo Agreement. This, I triist, may then be formally ratified. . , „ It will be observed that I have made no reference to the possible extinction ot the interest of the Indian Government in the opium trade within a term of years. I shaU submit what I have to say to your Lordship on this subject in the following despatch. I have, &c. (Signed) THOMAS FRANCIS WADE. No. 13. Sir T. Wade to Earl Granville. — {Received August 3.) M'y)fLord, Peking, Jund 8, 1882. " I HAVE the honour to inclose copies of my correspondence with the Grand Secretary Tso, referred to in my despatch of the 3rd instant, which by mistake I had not carried with me to Tien-tsin. T n 3.VG &C (Signed) ' THOMAS FRANCIS WADE. Inclosure 1 in No. 13. Sir T. Wade to Grand Secretary Tso. Sir, Peking, August 2, 1881. I HASTEN to acknowledge your Excellency's reply of 1st instant to my note of the 23rd July. It appears to me that I must have failed to make my meaning perfectly clear to your Excellency when we met at the Tsung-li Yam^n, and that I have been equally unsuccessful in the explanations submitted to your Excellency in the note to which I have now received your reply. But I will not take up more of your Excellency's time. My chief object in writing -was to prove to you that I had not been guilty of shifting my ground (" fan fu ") as the Memorial addressed to the throne in your Excellency's single name, I regretted to observe, liad represented. (Signed) THOMAS FRANCIS WADE. Inclosure 2 in No. 13. Sir T. Wade to Grand Secretary Tso. «ir, Peking, July 23, 1881. IN the " Sh^n Pao " newspaper published at Shanghae on the 29th June last, a paper is printed which purports to be a Memorial laid before the throne by your Excellency on the subject of opium taxation, in the course of which reference is made to myself in the following words : — "Your servant having been honoured by the command of your Majesiy to take -cognizance of foreign affairs, was of course not free to decline the responsibility, and when (in discharge of it) he received the British Minister Wei T'o-ma (Thomas Wade), he discussed with him the question of raisings the Tariff duty and li-kin excise upon opium, Tvith a view to diminishing the taste for it. Nor had Thomas Wade any objection to make thereto. But when Li Hung-chang arrived, your servant and he further discussed the matter with Thomas Wade on two occasions; Li Hung-chang having besides one separate conference with him alone ; and at these conferences Thomas Wade tnainiained •opinions at variance with those of your servants. There was a considerable change in his language (or he retracted much), and with reference to the augmentation of the price of opium, he showed as much irritation as if the change were something to be deplored. " Were your servants to have agreed to a proposition he subsequently made that 97 £G taels a chest should be the fixed amount (of opium taxation), this would have added little (to the present cost of trading), and not only would it have effected nothing towards diminishing the appetite for it, but by increasing the trade in foreign opium, it would have expanded the area of its distribution, and would have supplied an excuse for the cultivation of the poppy in the interior, and the trade in native opium. Great inconvenience also would have attended the additional levy of the li-kin. " His scheme, therefore, while its "proper object, namely, the increase of the duty and li-kin would be in great part defeated, being also otherwise impracticable," As the "Shen Pao " cannot be regarded like the " Peking Gazette " as a publication possessing official authority, it is, of course, possible that the paper to which I am directing attention may not be genuine. If this be the case, it will be my duty to apologize for having troubled your Excellency upon the subject. If the paper be genuine, I shall have done no harm by remarking that the statement of what has fallen from me on the subject of opium taxation, whether in conference with your Excellency or with other Ministers of the Tsung-li Yamfin, is greatly at variance with my own recollection of what was said by me. I have from the first declared my readiness to recommend Her Majesty's Government to acquiesce in any measure that would secure to the Government of China such revenue upon the sale of foreign opium as appeared to be but reasonable in amount. If the amount proposed appeared to me unreasonable, I was prepared, I said, to report it, but not to recommend its approval. The amounts respectively named by your Excellency and by the Grand Secretary Li, appeared to me on various grounds beyond what it was reasonable on the part of China to demand. I was pressed to say what 1 thought would be reasonable, but I declined. There is, nevertheless, an allusion in the Mesnorial attri- buted to your Excellency, to a " subsequent proposition " of mine that the maximum charge on opium should be SO.taels per picul. I made no proposition to that effect, but when in reply to my question regarding the li-kin revenue on foreign opium that the Chinese Government considered itself entitled to, 1 was informed by the Ministers present that the estimated total was 6,000,000 taels a-year. but that the whole of this, it was certain, was not collected, and that the cost of collecting so much as was collected was something like 10 per cent, upon the collection, I certainly did attempt to demonstrate that taking the opium import of a certain year as a standard, a uniform rate of 80 taels per picul, that is to say the Tariff rate of 30 tapis, plus 50 taels li-kin, if fairly collected, would add con- siderably to the revenue upon opium now received by the Chinese Exchequer. 1 am unable throughout the months that have been devoted to discussion of this question to recall a single utterance of mine that may be fairly held to expose me to the charge of shifting my ground, or whatever else may be the offence implied by the expression "fan fu." The personal reflections on myself, however, contained in the Memorial are, after all, but of secondary importance. What is more significant is this, that your Excellency, having assumed special charge of the question of opium taxation, should have so imperfectly appreciated the attitude of a foreign representative, a cleat- understanding with whom is almost indispensable to the security of the opium revenue, and who has throughout shown himself anxious to secure that revenue to China. The appearance of this Memorial in the "Sh^n Pao " has been of no advantage to any one, but it has naturally alarmed those connected with the opium traffic, and its first probable effect will be the stimulation of a contraband trade, I cannot doubt to the detriment of revenue. (Signed) THOMAS FRANCIS WADE. Inclosure 3 in No. 13. Grand Secretary Tso to Sir T. Wade. (Translation.) August 1, 1881. TSO TSUNG-TANG presents his compliments. The Grand Secretary received on the 24th ultimo Sir T. Wade's letter referring to a Memorial on the subject of stringent restrictions on opium, a copy of which he had read in the Shanghae " Sh^n Pao " newspaper. , Sir T. Wade denies that he made any pro- position, as therein stated, to' the effect that the charge on opium should be fixed at 80 taels per chest, or that anything that he said in the course of the conferences on increasing the duty on opium exposed him to the charge of vacillation. Sir Thomas Wade further stated that the appearance of this Memorial in the " Shen Pao " was of no advantage to any one, and its esfiect would be prejudicial to the national revenue. The Grand Secretary is given to understand that the Shanghae " Shen Pao " prints [12381 P 98 and publishes at once any news it obtains, and that there has never been any supervision or restriction placed upon it, or any regard paid to the importance of the news. The Memorial in question by the Grand Secretary on the subject of stringent restrictions on opium and advocating an increase of the li-kin and customs duty upon it was circulated by His Majesty's orders among all the provincial Customs authorities. There is no means of discovering from what quarter the " Shen Pao " office obtained a copy, and as the Memorial was not secret there is no occasion to make inquiries for the purpose or to suppress its issue. In view of the length of time that opium has banefuUy flooded this coun^try, the Grand Secretary proposed to Sir T. Wade, when he received hini at the Yamen, that as a preliminary' measure the duties and li-kin upon it should be increased, in the expecta- tion that on its price becoming dearer, opium-smokers would in some measure absfain from it on account of expense, and that in this way some real success might gradually be obtained. Sir T, Wade considered that, on account of the large evasion of duties in the interior, it would be far better to increase the customs duty and do away with the li-kin. The Grand Secretary assented to this view, and proposed to follow the rule adopted by foreign countries of levying duties on exports in proportion to their value, and the rule adopted by Great Britain of placing a double duty on luxuries for the table, and levy the exceedingly light import duty of 150 taels per chest. The Grand Secretary Li was in Peking at the time on business, and came with the writer to discuss the question at the Tsung-li Yam^n with Sir T. Wade. Sir T. Wade maintained that to raise the duty to 150 taels was unreasonable, and declared that he could not give his consent to the proposal. At the same time, he broached the idea of raising the duty without doing away with the li-kin, and at first consented to the addition of 5 taels per chest, then to 10 taels, and after a long discussion, to 15 taels as the maximum. The Grand Secretary found it hard to reconcile himself to this proposal. Sir T. Wade then said that any additional duty that China might see fit to impose on opium after it had left the port was a matter that did not concern him at all. Thus, his first proposition was to deal with the two duties together, and his later proposition was to deal with them separately. As both Sir T. Wade and the Grand Secretary had business that required their attention, neither was able to bring the other over to his views. On subsequent occasions, when Li Chung-tang and the Ministers of the Board of Foreign Affairs received Sir T. Wade, the writer was not present, but he heard that Sir T. Wade reverted to his first proposition of increasing the duty and doing away with li-kin, and, with regard to the increase in duty, consented to a maximum charge of only 80 taels per chest, and said that, to confirm the imposition of this charge, he would have to wait for a reply from the British Government and the Indian merchants. The Grand Secretary was aware that Sir T. Wade, from his position in Peking, at a great distance from his own Government and India, and from the time required for the interchange of telegrams, was able to act slowly. The Grand Secretary, in the post which he fills unworthily in the Grand Council, on the days on which he is on duty, awaits His Majesty's summons, and when business has to be transacted is expected to place the true facts before His Majesty without delay. Further, the increase of the duty and li-kin on opium is the most important point of the present question. Now, Sir T. Wade first was in favour of increased duty and no li-kin, then proposed to deal with the duty and to leave li-kin alone, and afterwards pro- posed to raise the duty and not to do away with li-kin. With regard to the amount by which the duty was to be raised. Sir T. Wade, in the hearing of the Grand Secretary himself, assented to 5, 10, and 15 taels, and afterwards, while discussing wit Li Chung-tang and the Ministers of the Board of Foreign Affairs an increased duty and no li-kin, mentioned 80 taels. This was only verbally, it is true, and there is no complete proof of the fact, but from -first to last the discussions have been vague and without a fixed policy ; how, then, could the Grand Secretary have approached His Majesty with this language ? Finally, for the settlement of this question, it is necessary that Sir T. Wade should ask for the instructions of his Government, and desire the Indian m,erchants to consider the matter and come to a determination upon it. The Grand Secretary, therefore, has nothing to which he can give or deny his consent. If he fails to represent the real facts, he is not doing his duty to his country or his Sovereign. How can he escape punishment ? Will Sir T. Wade try to place himself in the Grand Secretary's place, and consider whether it can be otherwise ? 99 As to the present scheme, ■when answers have been received from all the Superinten- dents of Customs, His Majesty will decide and act on such Memorial as meets his approval, and thus prevent the discussion of a variety of opposite views. The points that His Majesty considers as of chief importance are the moral improvement and the protection of the people. The national revenue is not his sole consideration, though to add to and not diminish it is of course one of the objects that he has in view. Sir T. Wade alludes to the injury that was inevitable (to the revenue, from the publi- cation of the Memorial). The Grand Secretary appreciates the depth of kindly feeling shown towards him, and when he learns of any injury will not fail, in acknowledgment of such great good-will, to represent it to His Majesty. A special reply. 1 .V3 o SI4 s a. 8 se 3 to s p s s c o a n a- 3' 00 o 3 (P 3 «■ s 0^ «1 a m r* *B " D- w -^ » K 'S S^ ■ a (b "^ S z H- 1 S S "■ 2 5; 0- o- to > " W "■ s ►— 1 T HM M CO ^' sr "= - p i-i 5' 00 >5" s- p ^s I"" OG CI' a "■ f?- KT y^^ 00 1" p» 00 1-15 OQ 3 «- s =^ re ■ en E3 OS CHINA. No. 1 (1890-91). 7 ADDITIONAL ARTICLE TO THE AGREEMENT BKTWEEN GREAT BEITAIN AND CHINA OP SEPTEMBER 13, 1876. Signed at Peking, March 31, 1890. Presented to hoth Houses of Parliament by Command of Her Majesty. January 1891. LONDON: PRINTED FOR HER MAJESTY'S STATIONERY OFFICE BY HAEEISON AND SONS, ST. MARTIN'S LANE, PEINTERS IK OBDINAET TO HEE MAJESTY. And to be purchased, eitlier directly or through any Bookseller, from EYBE AND SPOTTISWOODB, East HAEDiifa Steebt, Flbet Steebt, E.G., and 32, ABiNflDON, Steeet, Wbstmiitstee, S.W. ; OE JOHN MENZIES & Co., 12, Hanover Steeet, Edinbuegh ; and 21, DriTjRY Stueet, Glaskowj oe IIODaES, FiaGIS, & CO., 104. GEArioN Steeet, Dudxin. I C— fiaifi.J Price U. Additional Article to the Agreement between Great Britain and China of September 13, 1876. Signed at Peking, March 31, 1890. [Ratifications exchanged at Peking, January 18, 1891.] THE Governments of Great Britain and China, being desirous of settling in an amicable spirit the divergence of opinion which has arisen with respect to the first clause of the third section of the Agreement concluded at Chefoo in 1876, which stipulates that " The British Government will be free to send ofl&cers to reside at Chungking to watch the conditions of British trade in Szechuen, that British merchants will not be allowed to reside at Chimgking, or to open establishments or warehouses there, so long as no steamers have access to the port, and that when steamers have succeeded in ascending the river so far, further arrangements can be taken into considera- tion," have agreed upon the following Additional Article : — I. Chungking shall forthwith be declared open to trade on the same footing as any other Treaty port. British subjects shall be at liberty either to charter Chinese vessels or to provide vessels of the Chinese type for the traffic between Ichang and Chungking. II. Merchandize conveyed between Ichang and Chungking by the above class of vessels shall be placed on the same footing as merchandize carried by steamers between Shanghae and Ichang, and shall be dealt with in accord- ance with Treaty, Tariff Bules, and the Yangtsze 'Begulations. III. All Eegulations as to the papers and flags to be carried by vessels of the above description, as to the cargo certificates with which they shall be pro- vided, as to the repackage of goods for the voyage beyond Ichang, and as to the general procedure' to be observed by those engaged in the' traffic between Ichang and Chungking with a view to insuring convenience and security, shall be drawn up by the Superintendent of Customs at Ichang, the Taotai of the Ch'uan Tung Circuit, who is now stationed at Chungking, and the Commissioner of Customs in consultation with the British Consul, and shall be liable to any modifications that may hereafter prove to be desirable and may be agreed upon by common consent. IV. Chartered junks shall pay port dues at Ichang and Chungking in accordance with the Yangtsze Regulations ; vessels of Chinese type, if and when entitled to carry the British flag, shall pay tonnage dues in accordance with Treaty Eegulations. It is obligatory on both chartered junks and also vessels of Chinese type, even when the latter may be entitled to carry the British flag, to take out at the Maritime Custom-house special papers and a special flag when intended to be employed by British subjects in the trans- port of goods between Ichang and Chungking, and without such papers and flag no vessel of either class shall be allowed the privileges and immunities granted under this Additional Article. Provided with special papers and flag, vessels of both classes shall be allowed to ply between the two ports, and they and their cargoes shall be dealt with in accordance with Treaty Eules and the Yangtsze Eegulations. All other vessels shall be dealt with by the Native Customs. The special papers and flag issued by the Maritime Customs must alone be used by the particular vessel for which they were originally issued, and are not transferable from one vessel to another. The use of the British flag by vessels the property of Chinese is strictly prohibited. In- fringement of these Eegulations will, in the first instance, render the offender liable to the penalties in force at the ports hitherto opened under Treaty, and should the offence be subsequently repeated, the vessel's special papers and [68] ^ ^ flag will be withdrawn, and the vessel herself refused permission thence- forward to trade between Ichang and Chungking. V. When once Chinese steamers carrying cargo run to Chungking, British steamers shall in like manner have access to the said port, VI. It is agreed that the present Additional Article shall be considered as forming part of the Chefoo Agreement, and as having the same force and validity as if it were inserted therein word for word. It shall be ratified, and the ratifications exchanged at Peking, and it shall come into operation six months after its signature, provided the ratifications have then been exchanged, or if they have not, then on the date at which such exchange takes place. Done at Peking in triplicate (three in English and three in Chinese), this thirty-first day of March, in the year of our Lord one thousand eight hundred and ninety, being the eleventh day of the Second Intercalary Moon of the sixteenth year of Suang Hsii. (L.S.) JOHN WALSHAM. (L.S.) (Signature of Chinese Plenipotentiary.) "b S s C6 _6© ? le ■^ s •13 s a 8 >j Si &: a s <3 ^ ■ s 00 es. «> O- ^ 9 a a^ 00 o o^ s O p et H c= o 3. s; *! > a' o P» a is a. H w O O er t-i P3 5' p et- O e >-ti r»- Cr- rn m a "S > a Oq B 3 o- n> n P' 1 a »-i' s CO r*- ** cr 1— * (C 00 •VI « o M o 00 o I I® CHINA. No. 1 (1886). L-<" h P-*-^*- -"C J "/t- 'Ut.- -O^' M 6 /^ (i^ COEHESPONDENCE RESPECTING THE EEENOH TEEATY WITH AiNJSTAM, A.NI) NKG0TIATIONS BETWEEN FRANCE AND CHINA. -'•,1) '■ Present^ to both Houses of Parliament by Command of Her Majesty. April 1886. LONDON: PRINTED BY HARRISON AND SONS. To be purchased, either directly or through any Bookseller, from any of the following Agen » Viscount Lyons Mr. O'Conor To Mr. O'Conor Mr. O'Conor !f S< To Mr. O'Conor To Mr. O'Conor Telegraphic Telegraphic Telegraphic Mr. O'Cohor » )» 9i )» Telegraphic Telegraphic Date. Mar. 16, 1885 26, 28, Apr. 10, 16, 17, 22, 27, 29, May 6, 7, 8. 10, 10, H, Mar. 28, 29, May 23, 23, 23, 25, June 9, Apr. 14, [1771 SCB.TECT. Treaty of Hu6 of the 6th June, 1884. Sends copy annexed lo French Parliamentary documents , , . . . . . . Treaty of Peace almost settled between France and China on basis of Tien-tsin Convention Refers to above. Gives Articles of Prelimi- nary Agreement Sends extract from " Journal Officiel " announc- ing signature at Paris of Peace Preliminaries between France and China on the 4th April . To congratulate Chinese Cjovernment on signa- ture of Peace Preliminaries Answer to No. 4. To congratulate French Go- vernment on signature of Peace Prelimi- naries Answer to above. Congratulations of Her Majesty's Government conveyed to M. de Freycinet. Reinforcements still being sent to Tonquin . . French negotiations about to begin at Tien-tsin. Feeling against peace among military and Mandarin classes .^ .. Certain Articles in French draft Treatj? as to railways, Tonquin Tariff, and north frontier Customs staiions. Suggests asking for opening of West River, Canton, to British trade Answer to above. Objections to Railway Article. To report if it is likely to be agreed to. Substance telegraphed Further answer to No. 9. M frontier Tariff reduction is conceded to France, Her Ma- jesty's Government will demand similar reduction on trade by sea. Substance telegraphed .. Bill passed by Chamber of Deputies for ratifi- cation of Treaty of Hue (see No. 1) Answer to No. 10. Railway Article amended so as not to confer any exclusive rights Answer to No. 11. Reduced Tariff proposed to be limited to Annam products . . Answer to above. Further objections to re- duction of frontier Tariff See No. 3. Further account of Articles of Preliminary Agreement. . . . Observations on prospects of peace. Has' expressed hope to Chinese Government that there will be no commercial stipulations opposed to British rights and interests Nine Articles of Treaty out of ten agreed to.' Has informed Chinese Government according to instructions in No. 11 . . Approves language as reported in No. 17. To continue to pay attention to differential ad- vantages being granted to France. Sub- stance telegraphed Kefers to No. 11. Explains why,' if reduce'd' land Tariff be granted to France, Her Majesty's Government would claim most- favoured-nation treatment under the Treaty of Tien-tsin of the 26th June, 1858 To mention, if necessary, to Chinese Govern- ment Refers to No. ]8. Final Article"of Treaty settled. Signature may be expected towards end of month.. Treaty of Peace signed at Tien-tsin 'to-dav Sends Imperial Decree respecting renewal of friendly relations Jbelween France and China Page 1 7 7 7 8 8 9 9 9 10 10 10 10 11 12 12 12 12 13 13 TABIjEOP jOOKIIJNTiS. m 44 45 46 47 48 49 Name, Mr. O'Conor Viscount Iiyons Mr. O'Conor To Sir J. Walsham Mr. O'Conor Sir J. Walsham To Mr. O'Conor Sir J. Walsham To Mr. O'Conor To Colonial Office and India Office To Mr. O'Conor Visconat Lyons Kigi .. .(. To Colon&l Office apd India Office VigqouDj; hyom Colonial Office ,. Mr. O'Conor Viscount Lyons Colonial OflSce ,. Viscount Lyons . , To Board of Trade ., To India Office and Colonial Office To Mr. O'Conor Date. Apr. 20, 1885 June 19, 23, Apr. 29, July 2, May 10, 10, July 5, 6, 7, 8, 9, 9, 10, 10, 13, 17. 18, May 22, 25, July 22, 24, 24, 28, 28, 31, SUBJJECT. France has renounced for the present intention of attaching any important commercial stipu- lations to Definitive Treaty of Peace Refers to Nos. 1 and 12. Sends text of Law authorizing ratification of Treaty of Hu£ . Summary of Treaty between France and China signed af: Tien-tsin on the 9th June, as laid on table of Chamber of Deputies . . ... Further observations on Articles in Treftty .reported in No. 9. Incloses letter from Hong Kong Chambeif of Commerce Refers to No. 26. Sends copy of instruction to Mr. O'Conor (No. 20) . . I(efers to Nos. ]0 and .13» Railway Article framed so as not to cosfer excluBive rights on France . . . . , , Refers to Nos. 1 1 and 14. Reduced frontier Tariff to be limited to Annam pfoduots, or to a radius of 30 miles inland from frontier.. Reports language us?d to Chinese Govern- ment . . , . ... . . Refers to No. 26. Progress of Treaty of Tien-tsin in Chamber of Deputies. It. is held that most-favo^red-nation clause has reference to open pprts only, . and not to fifontier traffic. . , . .,._... Refers to No. 19. Sends copy of No. 26 , . Ratification of Treaty of Tien-tsin voted unanU mously in Chamber of Deputies. It has pow been laid before Senate . . , . . Refers to Nos. 9 and 27. To make representa- tions to Chinese Government respecting, the opening ^f the West River, Canton,- to British trade . . Answer to No, 30. Approves action re- ported Sends copy of No. 26, and invites observations Sends copy of No. 31. Her Majesty's Go- vernment do not concur in Frenph view of the . limitation pf the most-fsveured-nation clause to open ports dnly Gives, substance of the Report of the Com- mittee of the Chamber of Deputies on the Tien-tsin Treaty . . . . , . Sends copies of Nos. 27 and 34 ., Bill of ratification passed by Senate. Speech of M. de Freycinet on supply of railway material by Fraoee J . . . , Answers to Nos. 36 and 39. Observations on Treaty. Asks if steps have been taken to open up trade with south-western provinces of China .". - - ;. - - ■.;••- - -:-. Conversation with Chinese Ministers respecting reduced land Tariff See No. 21. Article respecting Annam settled. Prospect of early signature. Commercial stipulations will be made in separate Con- vention Promulgation by President of Law autho- rizing ratification Views in Hong Kong of Franco-Chinese Treaty Sends "Exposg des Motifs " and Bill of ratifi^ cation . . , , , . Sends correspondence relating to the Treaty, and asks if it is desirable to take any further steps to claim most-favoured-nation treat- ment Sends correspondence as in above for informa- /'""•• „ Answer, to No. 42. Approves language as reported 25 25 26 27 33 34 34 IV TABLE OF CONTENTS. No. 50 52 53 54 55 56 67 58 59 60 61 62 63 64 65 66 67 68 69 Name. To Mr. O'Conor To Colonial Office . . To Board of Trade and India Office Board of Trade .. To Mr. O'Conor To Board of Trade, India Office, and Colonial Office To Colonial Office and India Office Mr. O'Conor Sir J. Walsham .. Colonial Office To Colonial OESce . , Colonial Office .. Mr. O'Conor »» » Viscount Lyons To Mr; O'Conor Mr. O'Conor Date. July 31, 1885 31, Telegraphic Telegraphic Telegraphic Telegraphic Aug. 1, 5, 6> 7, 8, June 17, Aug. 13, 18, 24. 31, Sept. 9. 8, Nov. 10, Dec. Jan. 7. 37, 1886 Feb. 24, Mar. 13, 16, 16, Subject. Refers to ^os. 27 and 34. Sends copy of No. 41. and asks observations on points raised by Colonial Office, Incloses^copy of following .. .. f ' - . •' Answer to No. 41. Mr. O'Conor's attention will be drawn to points raised. J?teps taken as to trade on south-Western frontier . . Sends copy of No. 45 .. •• •• Observations on points in Treaty to which it would be advisable to draw Mr. O'Conor's attention more fully Sends copy of above for guidance . . . . Sends copies of Nos. 42 and 49 . . - . . Sends copy of No. 53 .. <• i-- Sends translation of Chinese text of Treaty with observations . . M. Cogordan appointed to negotiate Treaty of ^ Coflimerce between France and China ■ . . Acknowledges communications respecting Treaty. Presumes India Office has been communicated with Answer to above. Foreign Office is in com- munication with India Office Sends copy of despatch from Hong Kong respecting Franco-Chinese Treaty , Appointment of two Chinese officers for delimi- tation of China and Tonquin frontier Reports by Consuls Gardner and Allen on effect of commercial stipulations on British trade. «. .. .• -« Reports arrival of M. Cogordan, French Pleni- potentiary for Commercial Treaty nego- tiations. Will negotiate at Tien-t'sin with Li Hung-chang. Disturbances on Tonquin frontier . . . . ••■-.'. Departure of M. Cogordan for Tien-tsin , . Decree of President ordering full execution of Treaty. Text inclosed. . To' report as to contracts or concessions to foreigners Refers to No. 65. To report progress of commercial negotiations . ' ^ . Answer to No. 67. Improbable that China will bind herself to foreign Syndicates in a manner detrimental to British interests Commercial negotiations approaching conclu- sion. Gives principal clauses, &c. Page 34 34 35 35 37 37 37 37 38 39 39 39 41 41 48 49 49 55 55 55 55 Correspondence respecting the French Treaty with An nam, and Negotiations between France and China. No. J. Viscount Lyons to Earl Granville. — (Received March 18.) (Extract.) Paris, March IG, 1885. I HAVE the honour to transmit to your Lordship two Parliamentary documents relative to the Treaty concluded at Hue on the 6th June, 1884, between the French Republic and the Kinp;dom of Hue. The first is a Bill, preceded by an " Expos^ des Motifs,"* which has been brought into the Chamber of Deputies by the Government, to authorize tlie ratification of the Treaty. The second is a Report of a Committee of the Chamber of Deputies in favour of the Bill.* The text of the Treaty is annexed to the first of these documents. The Xth Article provides that in Annam and Tonquin foreigners of all nationalities shall be placed under French jurisdiction, and that the French authorities shall decide upon disputes of every kind, both between foreigners and between foreigners and Anuamites. Inclosure 1 in No. 1. Projet de Loi, LE President de la R^publique Fran9aise, DecrSte : Le Projet de Loi dont la teneur suit sera pr^sent^ a la Chambre des Deputes par le President du Conseil, Ministre des Affaires Etrangeres, qui est charge d'en exposer les motifs et d'en soutenir la discussion. Article unique. — Le President de la Eepublique est autoris^ a ratifier et a faire executer le Traite conclu le 6 Juin, 1884, a Hu6, enire la Republique Frangaise et le Royaume d' Annam et dont une copie demeure annexee a la presente Loi. Fait a Paris, le 12 Juillet, 1884. Le President de la Republique Frangaise, (ISign6) JULES GRBVY. Par le President de la Republique : Le President du Conseil, Ministre des Affaires Eltraugeres, (Signe) Jules Ferry. Traite. Le Gouvernement de la Republique Frangaise et celui de Sa Majesty le Roi d'Annam voulant empficher h. jamais le renouveUement des difficultes qui se sont produites recem- ment, et desireux de resserrer leurs relations d'amitie et de bon voisinage, ont r^solu de conclure une Convention a cet efFet, et ont nomm6 pour leurs Plenipotentiaires, savoir : — Le President de ]a Republique Frangaise, M. Patenotre (Jules), Officier de I'Ordre National de la Legion d'Honneur, Ministre Plenipotentiaire et Envoye Extraordinaire de la Republique pr^s de Sa Majeste I'Empereur de Chine ; * Not printed. [177] B Et Sa Majeste le Roi d'Annam, leurs Excellences Nguyen Van Thong, Premier Regent, Ministre de I'lnt^rieur; Thuan-Duat, Ministre des Finances et_Ton-Thuan-Phan, charge des Relations ExterieUres, Ministre des Travaux Publics par interim ; iLesquels, apres s'^tre communique leurs ))leins pouvoirs respectifs, trouves en bonne et due forme, sont convenus des Articles suivants ;— ™ ARTICLE I. L'Annam reconnait et accepte le Protectorat de la France. La France repr^sentera I'Annam dans toutes ses relations ext^rieures, Les Annamites h I'^tranger seront places sous la protection de la France. ARTICLE II. Une force militaire Frangaise occupera Thuan-xAn d'une £3900 permanente, Tous les forts et ouvrages militaires de la riviere de Hu^ seront rases. ARTICLE III. Les fonctionnaires Annamites, depuis la frontiere de la Cochinchine jusqu'^ la fronti^re de la Province de Nin-Binh, continueront a administrer les provinces com- prises dans ses limites sauf en ce qui concerne les Douanes, les Travaux Publics, et en general, les Services qui exigent une direction unique ou I'emploi d'ingenieurs ou d'agenta Europeans. ARTICLE IV. Dans les limites ci-dessus indiquees, le Gouvernement Annamite declarera ouverts au commerce de toutes les nations, outre le port de Qui-Nhon, ceux de Tourane et de Xuan-Day. D'autres ports pourront ^tre ulterieurement ouverts apres une entente prealable. Le Gouvernement Fran9ais y entretiendra des Agents places sous les ordres de son Resident a Hu6. ARTICLE V. Un Resident-General, Representant du Gouvernement Fran^ais, presidera aux Relations Exterieures de I'Annam et assurera I'exercice r^ulier du Protectorat, sans s'immiscer dans I'administration locale des provinces comprises dans les limites fixees par I'Article III. II r^sidera dans la citadelle de Hue avec une escorte militaire. Le Resident-General aura droit d'audience priv^e et personnelle auprfes de Sa Majeste le Roi d'Annam. ARTICLE VI. Au Tonkin des Residents ou R^sidents-adjoints seront places par le Gouvernement de la R^publique dans les chefs-lieux oil leur presence sera jugee utile. lis seront sous les ordres du Resident-Gdneral. lis habiteront dans la citadelle et, en lout cas, dans I'enceinte meme r^servee au Mandarin ; il leur sera donne, s'il y a lieu, une escorte Fran9aise ou indigene. ARTICLE VIL Les Residents dviteront de s'occuper des details de I'administrat'on int^rieure des provinces. Les fonctionnaires indigenes de tout ordre continueront a gouverner et h. administrer sous leur contr61e ; mais ils devront elrc rdvoques sur la demande des autorites Fran9aises. ARTICLE VIII. Les fonctionnaires et employes Frari9ais de toute categoric ne communiqueront avec les autorites Annamites que par rinterm^diaire des Residents, ARTICLE IX. Une ligne telegraphique sera ^tablie de Saigon h Banoi, et exploitee par des employes Frangais. Une partie des taxes se:a attribuee au Gouvernement Annamite qui concddera en retour, le terrain n^cessaire aux stations, ARTICLE X. En Annatn et au Tonkin, les Strangers de toute nationalite seront places sous la juridiction Fran^aise. L'autorite Frangaise statuera sur les contestations de quelque nature qu'elles soient qui 's'eleveront entre Annatnites et etrangers, dc ineme qu'eutre etrangers. AETICLE XI. Dans I'Annam proprement dit, les Quan-Ho percevront rioipofc ancien sans le contr61e des fonctionnaires Frangais, et pour compte de la Cour de Hue, Au Tonkin, les Residents centralisei-ont a"ec le coticours des Quan-Ho le service du m^me imp6t, dont ils surveilleront la perception et I'eniploi. Une Commission composee de Conimissaires Fran§ais et Annamites determinera les soinmes qui devront ^tre affectees aux diverses branches de 1' Administration et aux Services publics. Le reliquat sera verse dans les Caisses de la Cour de Hud ARTICLE XII. Dans tout le Royaume, les Douanes reorganisees seront enti^rement confines k des Administrateurs Fran^ais. II n'y aura que des Douanes Maritimes et de Frontilres placees partout oil le besoin se fei'a sentir. Aucune reclamation ne sera admise en matifere de Douanes, au sujet des mesures prises jusqu'^ ce jour par les autorites militaires. Les Lois et Rfeglements concernant les Contributions Indirectes, le regime et le Tarif des Douanes, et le regime sanitaire de la Cochinchine, seront applicables aux territoires de lAnnam et du Tonkin. ARTICLE XIII. Les citoyens ou proteges Frangais pourront, dans toute I'dtendue du Tonkin et dans les ports ouverts de I'Annam, circuler librement, faire le commerce, acquerir des biens meubles etimmeubles, et en disposer. Sa Majeste le Roi dAnnam confirme expressement les garanties stipulees par le Traite du 15 Mars, 1874, en faveur des missionnaires et des Chretiens. ARTICLE XIV. Les personnes qui voudront voyager dans I'interieur de I'Annam ne pourront en obtenir I'autorisation que par I'intermediaire du Resident-General k Hue ou du Gouverneur de la Cochinchine. Ces autorites leur delivreront des passeports qui seront presentes au visa du Gouverne- ment Annamite. ARTICLE XT. La France s'engage a garantir desormais I'integrite des IStats de Sa Majeste le Roi d'Annam, a defendre ce Souverain contra les agressions du dehors, et contre les rebellions du dedans. A cet effet, l'autorite Fran9aise pourra faire occuper militarement sur le territoire de I'Annam et du Tonkin les points qu'elle jugera ndcessaire pour assurer I'exercice du Protectorat. ARTICLE XTL Sa Majestd le Roi d'Annam continuera, comme par le passe, k dinger I'administration Intdrieure de ses Etats, sauf les restrictions qui r^sultent de la presente Convention. ARTICLE XVIl. Les dettes actuelles de I'Annam vis-a-vis de la France seront acquitt^es au moyen de payements dont le mode sera ulterieurement determine. Sa Majeste le Roi d'Annam s'interdit de contracter aucun emprunt h I'etranger sans I'autorisation du Gouvernement Fran(;ais. ARTICLE XVIII. Des conferences ulterieures regleront les limites des ports ouverts et des concessions Fran^aises dans chacun de ces ports, I'^tablissement des phares sur les c6tes de I'Annam et du Tonkin, le regime et 1 'exploitation des mines, le regime mon^taire, la quotitd a attribuer au Gouvernement Annamite sur le produit des Douanes, des Regies, des taxes tdlegraphiques et autres revenus non vises dans l' Article XI du present Traits* [177] B 2 La presente Convention sera soumise a I'approbation du Gouveriiement de la Repn- blique Francaise et de Sa Majeste' le Roi d'Annam, et les ratifications en seront ecbang^es aussit6t que possible. ARTICLE XrX. Le present Traite remplacera les Conventions des 15 Mars, 31 Aoiit, et 23 Novembre, 1874. En cas de contestation, le texte Francjais fera seul foi. En foi de quoi les Plenipotentiaires re?pectifs ont signe Ic present Traiti et y ont apposd leur cachet. Fait k Hue en double expedition, le 6 Juin, 1884. (L.S.) (Si^ne) PATENOTRE. (L.3.) (Signe) NGUy!':N-YAN-TUONG. (L.S.) (Signe) PHAMUD-THUAN-DUAT. (L.S.) (Signt-) T0U-']HAT-F.4Y. (Translation.) THE President of the French Republic, Decrees : The Bill of which the tenour follows shall be laid before the Chamber of Deputies by the President of the Council, Minister for Foreign Affairs, who is charged to explain its objects, and to support it in debate. Single Article. — The President of the Republic is authorized to ratify and carry out the Treaty concluded on the 6th June, 1884, at Hul, between the Erench Republic and the Kingdom of Annam, a copy of which is annexed to this Law. Done at Paris, the 12th July, 1884. The President of the French Republic, (Signed) JULES GRfiVY. By .the President of the Republic : The President of the Council, Minister for Foreign Affairs, (Signed) Jules Ferry. Treaty. The Government of the French Republic and that of His Majesty the King of Annam, wishing to prevent for the future the renewal of the difficulties which have recentlv occurred, and desirous of drawing closer their relations of friendship and good neighbour- ship, have determined to conclude a Convention with that object, and have named as their Plenipotentiaries the following, that is to say : The President of the French Republic, M. Jules Paten6ti'e, Officer of the National Order of the Legion of Honour, Ministei- Plenipotentiary and Envoy Extraordinary to His Majesty the Emperor of China ; And His Majesty the King of Annam, their Excellencies JS"guye;i Van Thon", First Regent, Minister of the Interior ; Thuan-Duat, Minister of Finance, and Ton-Thuan-Phan, in charge of Foreign Affairs, and provisional Minister of Public Works ; Who, having exchanged their respective full powers, which were found to be in due and proper form, have agreed upon the following Articles: — ARTICLE I. Annam recognizes and accepts the Protectorate of France. France shall represent Annam in all her foreign relations. Annaraites abroad shall be placed under the protection of France. ARTICLE 11. A French military force shall permanently occupy Thuan-An. All the forts and military works on the River Hu6 shall be razed. ARTICLE III. The Aimamite officials, from the Cochin China frontier to the frontier of the Province of Nin-Binh, shall continue to administer the provinces comprised within those limits, save in so far as regards the Customs, Puhlic Works, and in general those Services which require a single head or the employment of European engineers or agents. ARTICLE IV. Within the above-mentioned limits, the Annaraile Government shall declare the ports of Tourane and Xuan-Day, besides that of Qui-Nhon, to be open to the trade of all nations. Subject to previous agreement, other ports may be opened hereafter. The French Government shall keep Agents in these places, who will be under the orders of its Resident at Hue. xiRTICLE V. A n ?idciit-Genc!a!, representing tlic iM'c'.ich Government, sh.dl preside over the foreign relations of Anna-ii and secure the regular exercise of the Protectorate, without interfering in the local administration oi" the provinces comprised within the limits fixed by Article 111. He shall reside in the citadel of Hu6 with a military escort. The Resident-General shall have the right of private and personal audience of His Majesty the King of Annam. ARTICLE VI. In Tonquin, the Government of the Republic shall place Residents or Assistant Residents in those principal towns where their presence may be deemed advantageous. They shall be under the orders of the Resident-General. They shall reside in the citadel, and, in all cases, within the precincts of the space reserved for the Mandarin ; they shall be provided, when necessary, with a French or native escort. ARTICLE VII. The Residents shall avoid taking part in the details of the internal administration of the provinces. The native officials of every kind shall continue to govern and administer under their control ; but they shall be dismissed at the request of the French authorities. ARTICLE VIII. French functionaries and officials of every grade shall not communicate with the Annamite authorities except through the medium of the Residents. ARTICLE IX. A line of telegraph shall be established between Saigon and Hanoi, and shall be worked by French officials. A portion of the rates shall be assigned to the Annamite Government, who shall grant in return the ground necessary for the stations. ARTICLE X. In Annam and in Tonquin foreigners of every nationality shall be placed under the jurisdiction of France. French authorities shall adjudicate on disputes of any kind which may arise between Annamites and foreigners, as also between foreigners. ARTICLE XI. In Annam proper, the Quan-Ho shall levy the old tax without the Control of French officials, and on behalf of the Court of Hue. In Tonquin the Residents shall, with the concurrence of the Quan-Ho, concentrate the levy of the same tax, and shall superintend its collection and use. A Commission com- posed of French and Annamite Commissioners shall determine what sums shall be assigned to the various branches of the Administration and to the public service. The remainder shall be deposited in the treasury of the Court of Hu^. ARTICLE XII. Throughout the kingdom the reorganized custom-houses shall be intrusted solely td French Administrators. There shall only be maritime and frontier custom-houses which shall be established wherever the need for them may show itself. ' No complaint shall be admitted in Customs questions on the subject of measures taken up to the present time by the military authorities. , The Laws and Regulations concerning indirect taxation, the Customs system_ anti tariff, and the sanitary system of Cochin China, shall be applicable to the territories ot Annara and Tonquin. ARTICLE XIII. French citizens or " prote'gds " shall have the right, throughout the whole extent of Tonquin and in the Open ports of Annam, to move freely from place to place, to trade, to acquire personal or real property, and to dispose of it. His Majesty the King of Annam expressly confirms the guarantees accorded by the Treaty of the 15th March, 1874, in favour of the missionaries and of the Christians. ARTICLE XIV. Persons desiring to travel in the interior of Annam shall only be able to obtain per- mission to do so through the Resident-General at Hu6 or the Governor of Cochin China. ARTICLE XV. France engages henceforth to guarantee the integrity of the States of His Majesty the King of Annam, and to protect that Sovereign both against external invasions and internal rebellion. With that object the French authorities shall have the right to order a military occupation of such points in the territory of Annam and Tonquin as they shall deem necessary, in order to secure the exercise of the Protectorate. ARTICLE XVI. His Majesty the King of Annam sliall continue, as heretofore, to direct the internal administration of his States, except for the restrictions arising out of the present Convention. ARTICLE XVII. Tlie present debt of Annam to France shall be liquidated by means of payments, the manner of which shall be subsequently determined. His Majesty the King of Annam agrees not to contract any foreign loan without the sanction of the French Government. ARTICLE XVIII. Subsequent conferences shall determine the limits of the open ports and of the French concessions in each of such ports, the establishment of light-houses on the coasts of Annam and of Tonquin, the regulation and working of mines, the monetary system, the share to be assigned to the Annamite Government of the amount produced by the Customs, Excise, Telegraphs, and other revenues not mentioned in Article XI of the present Treaty. The present Convention shall be submitted for the approval of the Government of the French Republic and of His Majesty the King of Annam, and the ratifications thereof shall be exchanged as soon as possible. ARTICLE XIX. The present Treaty shall replace the Conventions of the 15th March, 31st August and 23rd November, 1874. ^ ' In case of dispute the French text shall alone be binding* In witness whereof the respective Plenipotentiaries have signed the present Treaty and have affixed thereto their seals. Done at Hu6 in duplicate, the 6th June, 1884. (L.S.) (Signed) PATEn6tRE. (L.S.J fSigned) NGUYEN-VAN-TUONG, (L.S.) (Signed) PHAMUD-THUAN-DUAT. (L.S.) (Signed) TO U-THAT-FA Y. No, 2. Mr. O'^onor to Earl Granville,-r-{Jl€(;emd March 26.) (Telegraphic.) Pehing, March 26, 1885. RELIABLE information reaches me that a Treaty of Peace between France and China has been almost settled on bases of Tien-tsin Convention. Chinese Government has agreed to Protocol, which is also accepted by French Minister for Foreign Affairs, saving slight modifications not considered likely ta cause difficulty. Commercial Treaty advantages reserved for futuTe negotiation ; I am assured no stipulation has been accepted injurid^s to English i^tere^ts. No. 3. Mr. 0' Conor to Earl Granville.-^{Received March 28.) (Telegraphic.) Peking, March 28, 1885. WITH reference to my telegram of the 26th instant, I gather Articles of Protocol are as follows : — 1. China re-ratifies Treaty of Tien-tsin; France engages not to demand more. 2. Blockade to be raised ; hostilities to cease on signature, 3. Definitive Treaty of Peace to be negotiated forthwith. No. 4. Viscount JLyons to Earl Qranville, — (Received April U.) My Lord, Paris, April 10, 1885. I HAVE the honour to transmit to your Lordship an announcement which has appeared in the " Journal Officiel " this morning, to the effect that Preliminaries of Peace between France and China were signed at Paris on the 4th April ; that the signature was to be followed by the promulgation at Peking of an Imperial Decree ratifying the Convention of the 11th May, 1884,* and ordering the Chinese armies of Yiinnan and Kwangsi to repass the frontier at fixed dates ; and finally, that the Minister for Foreign Affairs at Paris received yesterday afternoon from the French Minister at Shanghae a telegram announcing that the Decree had been issued and notified in thes form agreed upon. I have had yesterday and to-day some conversation on the subject with M. de Freycinet. He said that he sincerely hoped that these Preliminaries would put very shortly a stop to hostilities, and would prove to be the precursors of a definitive and lasting peace. He observed, however, that the dispatch of reinforcements to Tonquin would not be retarded, nor the strength of those reinforcements be diminished. It was only, his Excellency added, commonly prudent to take every precaution against attempts on the part of the Chinese to withdraw from the Preliminaries or delay the execution of them. I have, &c. (Signed) LYONS, Inclosure in No. 4, Extract from the "Journal Officiel" of April 10, 1885. DES dep^ches venues de Pekin ont annonc^, depuis plusieurs jours, que la paix dtait conclue entre la France et la Chine. II est exact, en efFet, qu'a la suite de pourparlers engages avec un Delegud du Gouvernement Chinois, des Preliminaires de Paix ont et6 signes k Paris le 4 Avril. Cet acte devait etre suivi de la promulgation h Pekin d'un Decret Imperial ratifiant la Convention du 11 Mai, 1884, et ordonnant aux armees Chinoises, du Yunnan et du * See Annexe 1, p. 29. Quang-si, de repasser la frontiere k des dates determin^es. Ce Decret devait 6tre notifid par le Vice-Roi du Tcheli au Consul de France h Tien-tsin. , Aujourd'hui, 9 Avril, le Ministre des Affaires Etrangferes h Pans a recu dans i ap^es- midi, du Ministre de France a Shang-Hai, un td^gramme annongant que le Decret a 6te rendu et notifi^ dans la forme convenue. (Translation.) DESPATCHES arrived from Peking announced some days ago that peace was concluded between France and China. It is, in fact, correct that, following upon negotiations carried on with a Delegate of the Chinese Government, preliminaries of peace were signed al Paris on the 4th April. This instrument was to be followed by the publication at Peking of an Imperial Decree ratifying the Convention of the 11th May, 1884, and ordering the Chinese armies of Yiinnan and the Kwang-si to recross the frontier at fix^d dates. This Decree was to be notified by the Viceroy of Tcheli to the French Consul at Tien-tsin. To-day, the 9th April, the Minister for Foreign Aflfairs at Paris received in the course of the afternoon a telegram from the French Minister at Shanghae, announcing that the Decree has been issued and notified in the form agreed upon. No. 5. Earl Granville to Mr. 0' Conor. (Telegraphic.) Foreign Office, April 16, 1885. CONVEY the congratulations of Her Majesty's Government to the Chinese Govern- ment on conclusion of Preliminaries of Peace between China and France. No. 6. Earl Granville to Viscount Lyons. My Lord, Foreign Office, April 17, l«8.5. HER Majesty's Government have received with great satisfaction the information conveyed in your Excellency's despatch of the 10th instant, that Preliminaries of Peace had been arranged between France and China; and I request that you will convey to the French Government the sincere congratulations of Her Majesty's Government on the cessation of hostilities between the two countries. I am, &c, (Signed) GRANVILLE. No. 7. Viscount Lyons to Earl Granville. — {Received April 23.) My Lord, Paris, April 22, 1885. THIS afternoon, in obedience to the instruction conveyed to me by your Lordship's despatch of the 1 7th instant, I expressed to M. de Freycinet the sincere congratulations of Her Majesty's Government on the cessation of hostilities between France and China. M. de Freycinet cordially acknowledged these congratulations. He said that no definitive peace had been made, but that, notwithstanding some trifling miUtary en"-ao-ements due apparently to inadvertence, he thought he was justified in saying that hostilities in fact were suspended. It would not, however, he added, be prudent to' retard the dispatch of the reinforcements to Tonquin. I have, &c (Signed) LYONS. 9 No. 8. Mr. 0' Conor to Earl Granville. — (Received April 27.) (Telegraphic.) Peking, April 27, 1885. I AM informed that French negotiations begin at Tien-tsin immediately. In military and Mandarin class strong feeling against peace. No. 9. Mr. 0' Conor to Earl Granville. — (Received April 29.) (Telegraphic.) Peking, April 29, ] 886. DRAFT French Treaty. Following among Articles : — When decided to construct railways, China shall apply to France for assistance and materials. Frontier Tariff of Tonquin two-thirds Treaty Tariff, North of Langson and Laokai frontier customs stations shall he open to French goods entering China. I would suggest we might ask for opening to British trade of West River, Canton. No. 10. Earl Granville to Mr. 0' Conor. Sir, Foreign Office, May 6, 1.885. I HAVE received your telegram of the 29th ultimo in regard to certain Articles of the draft Treaty between France and China ; and I have to state to you that the Article respecting the construction of railways appears to be objectionable, as it might give the French Government grounds for claiming exclusive rights which would hereafter be inconvenient to China, and would be objected to by other Treaty Powers. I have therefore to request you to report to me whether it is likely that this Article will be agreed to. The substance of the above was communicated to you this day by telegraph. I am, &c. (Signed) GRANYILLE. No. n. Earl Granville to Mr. 0' Conor. Sir, Foreign Office, May 7, 1885. I HAVE received your telegram of the 29th ultimo in r^^gard to certain stipulations which it is proposed to insert in the new Treaty between France and China. I have to state to you that you should let it be understood that if China concedes a reduction of the frontier Tariff to France, Her Majesty's Government will, under the most- favoured-nation clause of the Treaty of Tien-tsin of the 26th June, 1858, demand a similar reduction on trade by sea. The substance of the foregoing ^has this day been communicated to you by telegraph. I am, &c. (Signed) GEANVILLE. No. 12. Viscount Lyons to Earl Granville — (Received May 9.) My Lord, Paris, May 8, 1885. I HAVE the honour to inform your Lordship that yesterday, on the motion of M. de Freycinet, Minister for Foreign Affairs, the Chamber of Deputies passed the Bill to authorize the ratification of the Treaty between France and Annam, signed at Hu6 on the 6th June, 1884. [177] C 10 In replying to speeches made against the Bill, M. de Freycinet pointed out that this Treaty was cited in the Convention of Tien-tsin, which was itself cited in the Preliminaries of Peace of the 4th April last, and that consequently it must be introduced into the Definitive Treaty now under negotiation between France and China, He Went on to say that he hoped in a short time ("dans un delai qui ne sera pas long ") to announce to the Chamber the Satisfactory conclusion of that Treaty, and that for this reason he begged them to remove everything which might be an obstacle to the favourable progress of the negotiation. The Treaty of Hue of the 6th June, 1884, establishes a complete French Protectorate over Annam. The text of it and documents relating to it were transmitted to your Lordship with my despatch of the 16th March last. I have, &c. (Signed) LYONS. No. 13. Mr. 0' Conor to Earl Granville. — {Received May 10.) (Telegraphic.) Peking, May 10, 1S85. IN reply to your Lordship's telegram of the 6th instant, I have the honour to state that the Article respecting construction of railways as now amended says, " This is not to be understood as conferring any exclusive rights." No. 14. Mr. 0' Conor to Earl Granville. — {Received May 10.) (Telegraphic.) . Peking, May ]0, \885. WITH reference to your Lordship's telegram of the 7th instant, I understand that Yamen have proposed to limit reduced Tariff to Annam products, or, if this is not possible, to 30 miles from frontier. Reference to Paris has been made as to this Article. No, 15. Earl Granville to Mr^ 0' Conor. Sir, Foreign Office, May 11, 1885. I HAVE received your telegram of yesterday's date, I have to state to you that the reduction of the frontier Tariff, with such limitations as those you mention, cannot fail to lead to inconvenient questions. A claim on the part of France that the Tonquin frontier should be placed, in regard to Tariff duties, on the same footing as the Russian land frontier, cannot with fairness be maintained, as in the case of the latter the reduction of duty does no more, owing to the great cost of carriage, than place the trade on an equal footing with that of the ports. I have this day communicated to you the substance of the foregoing by telegraph. I am, &c. (Signed) GRACTVILLE. No. 10. Mr. 0' Conor to Earl Granville. — {Received May 19.) (Extract.) Peking, March 28, 1885. 1 SENT a telegram to your Lordship this day, giving, as far as I have been able, the substance of the Preliminary Agreement now under the immediate consideration of the Governments of France and China in the view of peace. The first Article, "China re-ratifies the Treaty of Tien-tsin, France engages not to demand more," was, 1 understand, agreed to by M. Ferry in the sense it was framed, 11 though the wording was amended. Article JI ran, as telegraphed to your Lordship, " Blockade to be raised, hostilities to cease on signature." I believe this Article to mean that the blockade of Formosa will cease from tlje date of signature of the Protocol, and that active hostilities will likewise come to an end ; but whether it also means that ships v\'ill be allowed to come north laden with rice I have not succeeded in finding out. The third Article, " Definitive Treaty of Peace to be negotiated forthwith," means, no doubt, that as soon as the Protocol is signed, fresh negotiations will be opened for a Definitive Treaty by the French Minister, still residing at Shanghae, coming north, or, though less likely, by the Marquis Ts^ng in Paris. M. Ferry appears to have agreed in substance to the three Articles, subject to approval, however, by the Chinese of some secondary, yet by no means unimportant, explanations, which he proposes shortly to furnish, Kelung is to remain in French possession, at any rate, till the regular Treaty of Peace is signed, and China contends for tlie status quo in Tonquin. As regards the frontier commercial advantages asked for by France, I understand that China has intimated her willingness to accord very liberal privileges, provided they are limited by two stipulations — first, that she is not asked for anything injurious to herself; and, second, that the privileges demanded are not incompatible with the most-favoured- nation clauses of her Treaties with foreign Powers. No. 17. A/f. 0^ Conor to EartX^tranville, — (Received May 19.) (Extract.) Peking, March 29, 1885. WITH reference to my despatch of yesterday's date, I have the honour to inform your Lordship that the main difference now existing between France and China appears to be whether, as the Chinese contend, the status quo shall continue in Tonquin until the Definitive Treaty of Peace, or, as the French require, the whole of that country, shall be given up to them as soon as the Preliminary Agreement or Protocol is signed. The question of the stoppage of rice coming northwards is also, I believe, a much disputed point. The French argue that by allowing Peking and the northern provinces to re-victual, they not only lose all the advantages of the. last six weeks, but afford China the means of continuing the war with greater ease should the present negotiations unhappily break down. The period intervening between the acceptance by both sides of the Protocol and the signature of the Definitive Treaty of Peace must be looked upon as a time of armistice, in which neither party should gain any advantage. I think it pot improbable that the Chinese will give way on this point, as they attach great importance to the somewhat similar understanding respecting the Island of Formosa. On the whole, the prospects of a speedy termination of the Franco-Chinese war seem very good at this moment. What may be the nature of the special frontier commercial advantages claimed by I'rance at the present moment I have failed to discover, though I gather from a Chinese source that, whatever they are, the Chinese Government has declared they must be limited by what they can afford to give to other nations who have the most-favoured-nation clause in their Treaties. J have also reason to think that certain definite commercial ^proposals of France are at this moment under the consideration of the Yamen, and I therefore thought it advisable in conversation with the Ministers this day to allude to the subject. I said that I had heard reports of negotiations for peace between France and China, and that I was sure Her Majesty's Government would hear with extreme satisfaction of the termination of a long find jp^inful war, which they had viewed with so much concern. I then went on to observe that, while wishing every success to the pending negotiations for peace, I felt it my dutyto express most earnestly the hope that, whatever mlglit "be the final terms, there would be found no commercial stipulations opposed to the rights or the legitinaate interests of England. It was, I said} t;he duty of the British Representative to cemenfr by every means in his power the grovving friendship between the two countries, and I felt sure their Excellencies wouM ^fligree with me in thinking that nothing should be done hkely to -check ^he 'further developm©nt of lihe good understanding now happily existing between them. £177] £i 2 12 In reply, the Ministers of the Yam^n assured me I might fee) quite easy on this point; but that, nevertheless, they would not fail to communicate the observations I had confidentially made to them on this subject to the other Ministers of the Tsung-li Yamfin. No. 18. Mr. O'Conor to Earl Granville. — {Received May 23.) (Telegraphic.) Peking, May 23, 1885. NINE uf the ten Articles of Treaty have been agreed to by the French and Chinese Governments. Article under discussion concerns intercourse with Annam. With reference to your telegram of the 7th instant, present arrangement merely stipu- lates that frontier Tariff shall be lower than maritime. 1 have pointed out to Yamen that we shall expect adjustment if our trade is placed at a disadvantage. :So. 19. Earl Granville to Mr. O'Conor. Sir, Foreign Office, May 23, 1885. I HAVE to inform you that I approve the language used by you with reference to the peace negotiations between France and China, as reported in your despatch of the 29th March. You should continue to pay unremitting attentitm to the question of any differential advantages being granted to France as against this country. The substance of the above was sent to you this day by telegraph. I am, &c. (Signed) GEAITV^ILLE. No. 20. Earl Granville to Mr. O'Conor. Sir, Foreign Office, May 23, 1885. WITH reference to my despatch of the 7th instant, I have to observe that, whilst the stipulations of existing Treaties with China have reference only to trade by sea with certain specified ports, and give this country no rights of trade across the land frontiers of China, the Treaty of Tien-tsin of 1858 declares, nevertheless, that "the British Government and its subjects will be allowed free and equal participation in all privileges, immunities, and advantages that may have been, or may be hereafter, granted by His Majesty the Emperor of China to the Government or subjects of any other nation." If, therefore, the effect of the new Treaty about to be negotiated between France and China would be to admit of French goods being introduced into China by land at a lower rate of duty than the same British goods could be introduced by sea, or would confer upon French citizens or their commerce any greater privileges or advantages than those which are at present enjoyed by British subjects, Her Majesty's Government would claim most- favoured-nation treatment under the clause of the Treaty of the 26th June, 1858 quoted above. ' ^ You will, in case of necessity, point this out to the Ministers of the Tsung-li Yamen. ° I am, &c. (Signed) GRAJIJVILLE. No. 21. Mr. O'Condr to Earl Granville, -^{Received May 25^) (Telegraphic.) p^^. j^ g g WITH reference to my telegram of the 23rd instant, final AiWsettled. Signature bf Treaty may be expected towards the end of this month. gu-Kuic 13 No. 22. Mr. 0' Conor to Earl Granville. — {Received June 9.) (Telegraphic.) Peking, June 9, 1885. SIGNATURE of Franco-Chinese Treaty of Peace took place, at Tien-tsin to-day. No. 23. Mr. 0' Conor to Earl Granville. — (Received June 16.) (Extract.) Peking, April U, 1885, I HAVE the honour to transmit herewith to your Lordship a copy of an Imperial Decree which appeared in last night's " Peking Gazette '' respecting the renewal of friendly relations between France and Chin.i. Inclosure in No. 23. Decree published in the " Peking Gazette " of April 13, 1885. (Translation.) A DECREE verbally communicated to the Grand Council. China and France are now considering the renewal of friendly relations, and the Treaty of Tien-tsin is sanctioned. We command that the various military divisions in diflFerent places cease operations within the time fixed, and that, in accordance with stipulation, the Yiinnan and Kwangsi troops be withdrawn to the frontier by the date that is determined on. No. 24. Mr. O'Conor to Earl Granville. — {Received June 16.) My Lord, Peking, April 20, 1885. IN the course of the prolonged negotiations which have resulted in the signature of a Preliminary Treaty of Peace in Paris on the ith instant, certain commercial and industrial stipulations of a more or less objectionable nature to British interests were reported as having been claimed by France of China. From one cause or another, the French Government appears to have renounced its intention, for the present at least, to carry along with the Definitive Treaty of Peace any important commercial stipulations, and, on learning this on reliable authority, I sent your Lordship the brief telegram which will be found in the telegraphic series of this day's date. I have, &c. (Signed) N. R. O'CONOR. No. 25. Viscount Lyons to Earl Granville. — (Received June 20.) My Lord, Paris, June 19, 1885. WITH reference to my despatches of the 16th March last and of the 8th ultimo, I have the honour to inclose herewith to your Lordship, extracted from the "Journal Officiel " of this day, a Law authorizing the President of the Republic to ratify the Treaty concluded on the 6th June, 1884, between France and Annam. The text of the Treaty appeared in the first inclosure in my despatch of the 16th March referred to above. I have, &c. (Signed) LYONS., 14 Inclosure in No. 25. Extract from the "Journal Officiel" of June 19, 1885. Loiportant Approbation du Traite' conclu a Hue', le 6 Jum, 1884, entre le France et le Royaume d'Annam, LE S^nat et la Chambre des Deputes ont adopte, Le President de la Republique promulgue la Loi dont la teneur suit : , v ^ • Article unique.— Le President de la Republique est autonse a ratifier et_ a taire executer le Traite conclu, le 6 Juin, 1884, a Hu^, entre la K^publique Franpaise et le Rovaume d'Annain, et dont une copie demeure annexde a la presente Loi. r^, ., La pre'sente Loi, d^lib^r^e et adoptee par le Senat et par la Chambre des Deputes, sera executde comme xoi de I'Etat. Fait a Paris, le 1 5 Juin, 1885. ^^.^^^^ ^^^^^ ^^^^^^ Par le President de la Republique : Le Ministre des Affaires Btrangferes, (Sign4) De Freycinet. (Translation.) Law confirming the Treaty concluded at Hue' on the 6th June, 1884, between France and the Kingdom of Annam. THE Senate and the Chamber of Deputies have passed, The President of the Republic promulgates the following Law : Single Article.— The President of the Republic is authorized to ratify and carry out the Treaty concluded on the 6th June, 1884, at Hu^, between the French Republic and the Kingdom of Annam, a copy of which is annexed to this Law. This Law, which has been considered and passed by the Senate and by the Chamber of Deputies, shall be carried out as a Law of the State. Done at Paris, the 15th June, 1885. (Signed) JULES GR^VY. By the President of the Republic : The Minister for Foreign Affairs, (Signed) De Freycinet. No. 26. Viscount Lyons to Earl Granville. — {Received June 24.) My Lord, Paris, June 23, 1885. I HAVE the honour to inform your Lordship that M. de Freycinet, Minister for Foreign Affairs, laid on the table of the Chamber of Deputies yesterday a Bill to authorize the President of the Republic to ratify the Treaty of Peace, Friendship, and Commerce concluded between France and China on the 9th of the present month at Tien-tsin. The Bill was, on the motion of M. de Freycinet, declared to be urgent. I have the honour to inclose the authentic Report of the proceedings which appears in the "Journal Officiel" this morning.* Your Lordship will find in it the "Expose des Motifs " with which the Bill was introduced, and also the text of the Treaty.f It is stated in the "Exposd des Motifs " that the object at which French poHcy has aimed for several years in the Indo-Chinese Peninsula has been to insure the pacification of Annam and particularly of Tonquin, and to open this region to European industry and commerce. Articles I and II of the Treaty recognize the exclusive rights claimed by France over Annam. Article III pro\'ides for the demarcation of the frontier between China and Tonquin. Article IV. provides that Frenchmen and French-protected subjects and foreigners shall not pass this frontier on their way to China unless provided with passports granted by the Chmese authorities on the frontier on the demand of the French authorities. The Article also contains regulations respecting the passage of the frontier by Chinese. * Not printed. f Sec Irttlosure in No. 66. 15 Arficle V begins as follows: "Le commerce d'importation et d*exporfcation sera permis aux n^gociants Frangais ou proteges Francais et aux negociants Chinois par la frontiere de terre entre la Chine et le Toiiquin." 'The Article provides that this trade shall be confined to certain fixed points; that French traders may establish themselves at these points on the same conditions as at the Treaty ports, and that the French Govern- ment may establish Consuls at these points. Article VI stipulates that special regulations shall be established with regard to trade by land between Tonquin and the Chinese provinces Yiitinan, Kouang-Si, and Kouang- Tong. It provides that these regulations shall comprise special regulations respecting the importation and exportation of opium. It concludes by declaring that trade by sea between China and Annam shall also be the subject of special regulations, but that provisionally no change shall be made in the existing practice. The Vllth Article relates to the construction of railways. The second paragraph of it runs as follows : — " Lorsque de son c6te la Chine aura decide de construire des voies ferries, il est entendu quelle s'adressera ^ I'industrie Fran9aise, et le Gouvernement de la Republique lui donnera toutes les facilites pour se procurer en France le personnel dont elle aura besoin. II est entendu aussi que cette clause ne peat 6tre entendu comme constituant un privilege exclusif en faveur de la France." Your Lordship will no doubt cause the details of these three Articles (V, VI, and VII) in particular to T)e very carefully examined, with a view to determining what bearing they may have on British interests and on the Treaty engagements of China towards Great Britain. Article VIII relates to the right of revising the commercial stipulations. Article IX provides that on the signature of the Treaty the French forces shall be ordered to withdraw from Kelung and to cease the exercise of the right of search, &c., on tbe high seas. It provides also that in a month after the signature of the Treaty the Island of Formosa and the Pescadores shall be completely evacuated by the French forces. Article X relates to the maintenance of the old Treaties between France and China, and to the exchange of the ratifications of the pfesent Treaty. M. de Freycinet mentioned three Annexes, which, however, he did not read, and •which do not, therefore, appear in the report of the proceedings, 1 have, &c. (Signed) LYONS. No. 27. Mr. 0' Conor to Earl Granville. — (Received June 30.) (Extract.) _ Peking, April 29, 1886, I HAD the honour to send your Lordship this morning a telegram embodying what I learn are the three principal Articles of the proposed Definitive Treaty of Peace between France and China. The Treaty itself consists, I believe, of ten Articles, but the seven others relate to matters of less importance to foreign countries, and treat in great; measure more directly of affairs relating to Tonquin, Annam, &c. The first Article mentioned in my telegram, namely, that " when it is decided to construct railways in China the Chinese Government shall apply to France for assistance and materials," would, if the "shall" is so introduced as to be capable of an imperative interpretation, constitute a most objectionable monopoly, and one which I feel sure Her Majesty's Government would not view with satisfaction, t hope, however, in the course of a few davs, to be able to find out the exact wording and import of this stipulation, and the interpretation given to it by the French Minister in his negotiations ^vith the Viceroy. If it is meant to secure for France a monopoly of the building of railways, even though for a limited time, I feel sure I should be acticg in accordance with your Lordship's views in letting the Yam^u see, as far as 1 could do so without laying myself open to any charge of wishino- to affect injuriously the success of the negotiations, that Her Majesty's Govern- ment a°e opposed to any monopolies being granted to foreign Governments in China which might prove detrimental to tbe interests of British commercial enterprise. ° To the demand for a reduction in the frontier Tariff to two-thirds of the Treaty Tariff', I ^tn Jnclinecl to tlunk China will accede in one fgrni pr another, though the 16 concession will no doubt be framed as much as possible to Prf^nt other Powers from having cause for interference or complaint in virtue of the raost-favoured-nation clause or As I understand the last Article of those I telegraphed to 1°"^ lordship, France requires that customs stations shall be established on or inside the Chmese l/ontier at places hereafter to be named, north of Langson and Laokai. which shall enjoy all the advantages of the present Treaty ports, whence French goods shall be. admitted to the interior of China, to the provinces of Yunnan, Kwangsi, Kwantung, &c. If this Article opens up these western provinces to French trade, or even specifies certain towns to which French products can be sent from the frontier under transit pass, it would give an impetus to French commercial enterprise, and conter advantages the appHcation of which to British trade might well be claimed. , , , _ ^ I inclose a copy of a letter addressed last year to Sir H. Parkes by the Hong Kong Chamber of Commerce, setting forth the great commercial advantages hkely to accrue from the opening up of Yiiunan, Kwangsi, and Kwantung to French product?, and pointing out the benefit to be derived by British trade should the Canton River be opened to steam navigation, and British products allowed to cu'culate freely through these provinces. ^. xt r. i c • j Owing to the lately existing state of aff'airs in China, Sir Harry Parkes retrained from offering any observations on the subject referred to by the Chamber of Commerce. The cessation of hostilities, however, and the fact that the Treaty of Peace now under negotiation at Tien-tsin will be likely to entail the opening of these provinces to French trade, seem to indicate the present moment as a favourable opportunity for pressing similar privileges in favour of British trade on the notice of the Chinese Government, and I therefore ventured to draw your Lordship's attention to this point in my telegram of this day's date. Inclosure in No. 27. Mr. Keswick to Sir H. Parkes. Hong Kong General Chamber of Commerce, Hong Kong, Sir, July 3, 1884. I HAVE the honour to address your Excellency, by desire of the Committee of this Chamber, with reference to the changes that may reasonably be expected to take place in foreign intercourse with China, consequent upon events that have recently transpired in Annam and Tonquin. ^"-^^ The military successes which the French have achieved and their recognition by the Chinese Government in the Convention signed at Tien-tsin on the 1 1th May last are events of supreme importance, both in a pohtical and commercial sense, to South China, and also touch very nearly the mercantile interests of this Colony. The Convention provides for trading facilities between the country now to be protected by France and the frontier provinces of Kwantung, Kwangsi, and Yiinnan, and the terms of the Convention generally indicate the common belief that the time has now come when foreign Powers should require a revision of the conditions of their intercourse with China, and claim the concession of facilities for trade as favourable as those granted to France. The Committee consider revision necessary, not alone for the protection of foreign commercial interests, which are, of course, primarily the object of the Chamber's concern, but also, and not less, in the interests of China herself, and for the development and future independence of the trade of her frontier and western provinces. In South China there has been no progress whatever made towards obtaining access to the country from the olden days when Canton was the factory in which commerce centred ; and beyond the city the river with its many branches and valuable tributaries still remains closed to foreign enterprise, to steam communication, and to improvement and progress in every form. The changes, however, which the recent Treaty concluded between France and China recognizes render it impossible that China can longer keep closed the provinces that border on Tonquin, and it is probable that under French influence enterprise will be directed towards diverting the trade of these provinces into channels where science will remove natural obstacles and an enlightened administration overcome other difficulties. The natural trade routes therefore from the west by the numerous branches and tributaries of what is known as the Canton River should, in the interests of China and also of foreign nations trading with her, be opened up as unreservedly as possible to steam communica- 1^ tion. Under well-considered customs regulations there should be no difficulty in protecting the revenue, and this Chamber, instead of indicating simply large cities to wliich foreigners should be admitted, would express a hope that by means of passports, and, if necessary, by security bonds, foreign traders should have perfect freedom of travel and residence in the interior for all lawful purposes. By opening all navigable streams?, by removing obstructions to navigation where such exist, and by allowing the same natural and unrestricted development of the means of communication that other nations leave to private enterprise, China would secure commercial advantages of great value, and strengthen herself greatly in a national and social sense. Railways are essential to the vigorous and to the highest development of a country; but they are costly, and should hardly precede the utmost development of water communication where there are navigable streams. The employment of steamers would cost the Government nothing, as private enterprise would introduce and maintain them. The Committee do not desire to confine their recommendation to the opening up of South China, although recent events lead them more urgently to press for Kwantung, Kwangsi, and Yunnan being brought under a regulated system of internal communication free to all nations, and the Committee would suggest, for your Excellency's consideration, that at this time of inevitable change the opportunity should be aP I'execution pleme et entiire de ce Traits. ^ Art. 2. Les deux Puissances consentent h cesser les hostilit^s partout, aussi vite nn^ es ordres pourront etre donnes et requs, et la France consent k lever immddiatement 1p •blocus de Formose. "icuo le Art. 3. La France consent k envoyer un Minjstre dans Ip nord, c'est-k-dire k Tien- 31 Tsin ou a P^kin, pour arranger le Traits detaille, et les deux Puissances fixeront alors la date pour le retrait des troupes. Fait a Paris, le 4 Avril, 1885. (Signd) BILLOT. CAMPBELL. 2. Note explicative du Protocole du 4 Avril, 1885. 1 . Aussitot qu'un D^cret Imperial aura 6t6 promulgue, ordonnant la mise a execution du Traite du 11 Mai, 1884:, et enjoignant par consequent aux troupes Chinoises qui se trouvent actuellenient au Tonkin de se retirer au del^ de la fronti^re, toutes les operations militaires seront suspendues sur terre et sur mer, a Formose et sur les c6tes de Chine ; les Commandants des troupes Frangaises au Tonkin recevront I'ordre de ne pas francbir la fronti^re Chinoise. 2. Dhs que les troupes Chinoises auront regu I'ordre de repasser la fronti&re, le blocus de Formose et de Pak-Hoi sera lev^ et le Ministre de France entrera en rapport avec les Plenipotentiaires nommes par I'Empereur de Chine, pour negocier et conclure, dans le plus bref ddlai possible, un Traite D^finitif de Paix, d'Amitid, et de Commerce. Ce Traits fixera la date a laquelle les troupes Franyaises devront evacuer le nord de Formose. 3. Afin que I'ordre de repasser les frontilres soit communiqud le plus vite possible par le Gouvernement Chinois aux troupes du Yiianan, le Gouvernement Frangais donnera toutes facilites pour que cet ordre parvienne aux Commandants des troupes Chinoises par la voie du Tonkin. 4. Considerant toutefois que I'ordre de cesser les hostilites et de se retirer ne pent parvenir le meme jour aux Franyais et aux Chinois et a leurs forces respectives,,il est entendu que la cessation des hostilites, le commencement de I'evacuation et la fin de I'^vacuation auront lieu aux dates suivaates : — Les 10, 20, et 30 Avril, pour les troupes a I'est de Tuyan Quan. Les 20, 30 Avril, et 30 Mai, pour les troupes a I'ouest de cette place. Le Commandant qui, le premier, receva I'ordre de cesser les hostilites, devta en com- muniquer la nouvelle a I'ennemi le plus voisin, et s'abstiendra ensiiite de tout mouvement, attaque, ou collision. 5. Pendant toute la duree de I'armistice et jusqu'^ la signature du Traite Delinitif, les deux parties s'engagent a ne porter k Formose ni troupes, ni munitions de guerre. Aussit6t que le Traite Definitif aura ete sigh^ et approuv6 par Decret Imperial, la France retirera les vaisseaux de guerre employes a la visite &c., en haute mer et la Chine rouvrira les ports k Traite aux beitiments Fran9ais &c. Fail a Paris, le 4 Avril, 1885. (Signe) BILLOT. CAMPBELL. (Translation.) Annexes. Preliminary Convention concluded at Tien-tsin on May 11, 1884. ARTICLE I. France undertakes to respect and protect against any aggressive measures whatsoever, and under all circumstances, the southern frontiers of China bordering on Tonquin. ARTICLE II. The Celestial Empire, reassured of the formal guarantees of good-neighbourly feeling accorded to her by France as regards the integrity and safety of the southern frontiers of China, undertakes : — 1. To withdraw immediately to her frontiers the Chinese garrisons of Tpoquin. 2. To respect, now and in the future, the Treaties directly concluded^ or to be coucluded, between France and the Court of Hue, ARTICLE III. In recognition of tbe conciliatory attitude of the Government of the Celestial Empire, and as a tribute to the patriotic wisdom of his Excellency Li Hung-chang, the 82 negotiator of this Convention, France will not ask for an indemnity from China. In return for this, China undertakes to permit, over the whole extent of her southern frontiers bordering on Tonquin, free traffic in goods between Arinam and France on the one part and China on the other, to be regulated by a Commercial and Customs Convention, which shall be drawn up in the most conciliatory spirit on the part of the Chinese negotiators, and under the most advantageous conditions possible for French commerce, ARTICLE IV. The French Government undertake to make use of no expression calculated to prejudicially aflFect the prestige of the Celestial Empire in drafting the definitive Treaty which they are about to conclude with Annam, and which will annul former Treaties relative to Tonquin. ARTICLE T. As soon as the present Convention shall have been signed, the two Governments shall name their Plenipotentiaries, who shall meet in three months' time to work out the details of a definitive Treaty on the bases established by the preceding Articles. In conformity with diplomatic usage, the French text shall be binding. (2.) Telegram from Mr. Hart to Mr. Campbell, for M. Ferry. Peking, February 26, 1885. The Emperor has authorized the proposal of the four following Articles : — 1. On the one part, China consents to ratify the Convention of Tien-tsin of May 1884, and on the other, France consents to demand nothing more than is stipulated in this Convention. 2. The two Powers agree to a general cessation of hostilities as soon as the orders can be given and received, and France agrees to raise at once the blockade of Formosa. 3. France agrees to send the Minister to the north, viz., to Tien-tsin or Peking, in order to settle the details of the Treat)-, and the two Powers shall then fix the date for the withdrawal of the troops. 4. Mr. James Duncan Campbell, Commissioner and Secretary, detached from the Inspector-General of Chinese Imperial Maritime Customs, of the Second Class of Chinese Civil Rank, and Officer of the Legion of Honour, is invested with full powers as Special Chinese Commissioner to sign this Protocol jointly with the official appointed by France, by way of a preliminary understanding. (3.) Protocol of April A, 1885. Between M. Billot, Minister Plenipotentiary, Director of the Political Department of the Ministry of Foreign Affairs, and James Duncan Campbell, Commissioner, and Non- Resident Secretary of the Inspector-General of the Chinese Imperial Maritime Customs of the Second Class of Chinese Civil Rank, and Officer of the Legion of Honour. Being both of them duly authorized to that effect by their respective Governments ; Have agreed upon the following Protocol and explanatory note annexed thereto : 1. Protocol. Article 1. On the one part, China consents to ratify the Convention of llen-tsin of the 11th May, 1884, and on the other part, France declares that she has no other end in view than the full and entire execution of this Treaty. Article 2, The two Powers consent to a general cessation of hostilities as soon as the necessary orders can be given and received, and France consents to the immediate raising of the blockade of Formosa. Article 3. France consents to send a Minister to the north, i.e., to Tien-tsin or Peking, to arrange the details of the Treaty, and the two Powers shall then fix a date for the withdrawal of the troops. Done at Paris, the 4th April, 1885. (Signed) BILLOT. CAMPBELL. 33 2, Note Explanatory of the Protocol of April 4, 1885. 1. As soon as an Imperial Decree shall have been promulgated ordering the execution of the Treaty of the ll(h May, 1884, and therefore enjoining the Chinese troops who are at present at Tonquin to retire over the frontier, all military operations shall be suspended by land and by sea, at Formosa, and on the Chinese coasts. The commanding officers of the French troops in Tonquin will receive orders not to cross the Chinese frontier. 2. As soon as the Chinese troops shall have received orders to re-cross the frontier, the blockade of Formosa and of Pak-Hoi will be raised, and the French Minister will enter into official relations with the Plenipotentiaries appointed by the Emperor of China, to negotiate and conclude with the least possible delay a Definitive I'reaty of Peace, Friendship, and Commerce. This Treaty shall fix the date on which the French troops shall evacuate the northern part of Formosa. 3. To insure the order for re-crossing the frontiers being communicated as soon as possible by the Chinese Government to the troops of Yunnan, the French Government will afford evei'y facility for such order to reach the commanding officers of the Chinese troops by way of Tonquin. 4. Considering, however, that the order for the cessation of hostilities and for withdrawal cannot reach the French and the Chinese and their respective forces on the same dav, it is understood that tlie cessation of hostilities, the commencement of the evacuation, and the conclusion thereof shall take place on the following dates :— The 10th, 20th, and 30th April for the troops east of Tuyan Quan. The 20th and 30th April and the 30th May for the troops to the west of that place. The commanding officer who shall first receive the order to cease hostilities shall be bound to communicate the news to the nearest hostile force, and shall abstain thence- forward from any hostile movement, attack, or collision. 5. During the entire period of the armistice, and until the signature of the Definitive Treaty, the two parties undertake not to convey to Formosa either troops or munitions of war. As soon as the Definitive Treaty shall have been signed and approved by Imperial Decree, France shall withdraw her ships of war employed in search duty, &c., on the high sea^, and China shall reopen her Treaty ports to French vessels, &c. Done at Paris, the 4th April, lc85, (Signed) BILLOT. CAxMPBELL. No. 47. Mr. Carrie to Sir T. Farrer. Sir, _ Foreign Office, July 28, 1885. I AM directed by the Marquis of Sahsbury to transmit to you, to be laid before the Board of Trade, copies of the correspondence marked in the margin* relative to the Treaty of Peace concluded between France and China at Tien-tsin on the i^th ultimo. Their Lordships will see from the despatches sent by Lord Granville and by Lord Salisbury to Her Majesty's Charge d'Atfaires at Pekiiig, that every precaution was taken to re-serve the right of Her Majesty's Government to claim, under the must-favoured-nation clause of the Treaty signed at Tieu-tsin on the ji6th June, 1858, between this country and China, any reduction of Tariff which may be conceded to France on the land frontier between Tonquin and China. It is difficult to say, until the Regulations to be drawn up under Article VI of the Treaty between France and China arc made public, whether, having regard to the greater cost of land carriage, the reduction will be such as to give any advantage to merchandize imported into China from Tonquin over goods landed at the Treaty ports. Lord Salisbury would be glad to be favoured with their Lordships' opinion as to whether it would be desirable to take any further steps at the present moment for establishing our right to raost-favoured-nation treatment, or whether the instructions given to Mr. O'Conor in Lord Granville's despatch df the 23rd May are sufficient until we are in possession of the details of the Regulations to be issued under Article VI of the Treaty. I am, &c. (Signed) P. CURRIE. * Nos. 11, 15, 16, 17, 18, 19, 20. 21; 24, 26, 27, 29, 30, 51, 33, 34, 36, 37, and 38. [177] F No. 48. Mr. Currie to Mr, Godley.* gjr Foreign Ofiee, July 28, 1885. WITH reference to my letter of the 9th instant, I am directed by the Marquis of Salisbury to transmit to you, to be laid before Lord Randolph Churchill, copies^of the corresponderice marked in the marginf respecting the Treaty between France and China. ^ It will be seen that instructions have been given to Her Majesty's Charge d'Affaires at Peking to inform the Chinese Government that, in the event of a reduction of the Frontier Tariff being granted to France by China, Her Majesty's Government will claim to be placed on a similar footing under the most-lavoured-nation clause of their Treaty with China signed at Tien-tsin on the 26th June, 1858, I am, &c. (Signed) P. CURRIE. No. 49. The Marquis of Salisbury to Mr. O'Conor, Sir, Foreign Office, July 31, 1885. I HAVE received your despatch qf the 22nd May last, reporting the substance of what passed in your conversation with the Prince and Ministers of the Yjanaln on the previous day in regard to the effect on British trade of the Treaty receptly concluded between France and China. In reply, I have to express to you my approval of your proceedings as reported JQ that despatch, and of your efforts to secure to this country the benefits of the most^ f^ypu red-nation clause of our Treaty with China, I am, &c, (Signed) SALISBURY. No. 50. The Marquis of Salisbury to Mr. 0' Conor. Sir, Foreign Office, July 31, 1885. WITH reference to your despatch of the 29th April last, and to my reply of the 8lh instant, I transmit, for your information,' a copy of a letter from the Colonial Office, accompanied by an extract from Sir George Bowen's despatch referred to in that letter, relative to the question of opening the south-western provinces of China to trade.f You will observe that the Colonial Office also call attention to the right of Her Majesty's Government, under Article LIV of the Treaty of Tien-tsin of the 26th June, 1668, to claim the same power of placing Consuls on the Tonquin fiontier as has been secured to the French Government under Article V of the Treaty of Peace recently concluded by them with China. On this point I shall be glad to be furnished with any observations you may have to offer. A ccpy of a letter which has been addressed to the Colonial Office in regard to these matters is ulso inclosed herewith. § I am, &c. (Signed) SALISBURY. No. 51, Mr. Currie to Sir R. Herbert. Sir, Foreign Office, July 31, 1885. 1 AM directed by the Marquis of Salisbury to acknowledge the receipt of your letter of the ISth instant relative to the bearing of the Treaty of Peace concluded on the r^tli I'ltirno between France and China on British interests. * Also to Colonial Office. t Nos. 11, 15, 16, 17, 18, 19, '^0, 21, 24, 27, 29, 30, 3J, 33, 84, 35, 37, and 38. t No. 44, § No. 51. 35 , In reply to your suggestion as to the right of Her Majesty's Government, under Article LIV of the Treaty of Tien-tsin of the 26th June, 1S58, to claim the same power of placing Consuls on the Tonquin frontier as has been secured to the French Government under Article V of their recent Treaty with China, 1 am to state to you, for the information of Colonel Stanley, that Mr. O'Conor's attention will be called to the subject. In regard to your inquiry, whether any steps have been taken towards opening up the south-western provinces of China to foreign trade, I am to call your attention to the correspondence with Mr. O'Conor, copies of which accompanied my letter of the 13th instant, from which you will perceive that he has been directed to make a representation to the Chinese Government as to the participation of this country in the trade of the Canton Eiver. Sir George Bowen's despatch of the 21st Miiy, 1884, which accompanied your letter of the 18th instant, is returned herewith. I am, &c. (Signed) P. CURRIE. No. 52. Sir P. Currie to Sir T. Farrer,* Sir, Foreign Office, August 1, 1885. WITH reference to the letter from this Office of the 28th ultimo, I am directed by the Marquis of Salisbury to transmit to you, to be kid before the Lords of the Committee of Privy Council for Trade, a copy of a letter frotn the Colonial Office,t forwarding copies of telegraphic correspondence with the Acting Governor of Hong Kong on the subject of the Treaty between France and China. I am, &c. (Signed) P. CURRIE. No. 53. Mr. Calcraft to Mr. Currie. — {Received August 6.) Office of Committee of Privy Council for Trade^ Sir, August 6, 1885. I AM directed by the Board of Trade to acknowledge the receipt of your letters of the 2Sth ultimo and 1st and 3rd instant,! transmitting for their consideration copies of certain correspondence respecting the Treaty of Peace concluded between France and China on the 9th June last, and asking the opinion of this Board as to whether any further instructions to Her Majesty's Charge d'AfFaires at Peking are immediately necessary in regard to the stipulations of the Treaty which affect British interests. In reply, I am to state that the Board of Trade fully concur in the instructions given to Mr. O'Conor in the Foreign OfiSce letter of the 23rd May last, in which it is pointed out that most-favoured-nation treatment would be claimed by Her Majesty's Government under the Treaty of Tien-tsin of 1858 in respect of lower duties of goods' introduced by land, and as regards any privileges or advantages given to French citizens or their com- merce on the land frontier ; but this Board would suggest, for the Marquis of Salisbury's consideration, that it might be advisable to direct Mr. O'Conor's attention rather more fully to the points involved in Clauses IV to VI of the Franco-Chinese Treaty, and they would therefore offer the following observations on the subject. 1. Article IV as to the rights of French subjects to pass over the frontier is nominally of a restrictive character. There is to be no such right, it is said, except on passports being obtained. But the clause is also so worded that the Chinese authorities woilid be obliged to give passports on the demand of the French authorities. Under this elause, accordingly, Frenchmen would appear to have a special and exclusive right of access to China by the Tonquin frontier, whilst no such pi-ivilege is promised to British subjects. Article IX of the Treaty of Tien-tsin no doubt gives a general right to English subjects to pass into the interior of China under passports to be issued by the Consuls, and signed by the local authorities, but unless there are English Consuls at each point of the frontier at which French subjects rnay pass over, which is not the case, the general stipislaticm in * Also to fhe India Office. t No. 4S. J ri3telog«!9 copies of Noa. 43 and 46; [1773 - 1' 2 at) the Treaty with England would be rendered illusory. The careful mention of French subjects onlv, or foreigners resident in Tonquin, shows a design to exclude all others. '2. Article V is even more clearly in derogation of the rights previously givento British subjects. It states expressly that the commerce of importation and exportation will be permitted to French merchants or merchants who are under French protection, and to Chinese merchants over the frontier st certain stipulated points, and that French merchants may establish themselves at these points on the same conditions and with the same advantages as in the Treaty poits ; farther, that Franco may establish Consuls at these places with piivilea;es and powers identical to those of Agents of tlie same class at the Treaty "ports, 'i'he EngHsh Treaty (Article VII) only gives the British Government power to establish Consuls at open jiorts or cities, while trade can only be carried on through the Treaty ports. The present Treaty, therefore, giving France and French subjects another means of access to China, coiifers on them a privilege and advantage not given to British subjects. To act consistently with its English 'JVcatie?, the Chinese Government should have reserved power to English subjects to trade at the same points, and power to the English Government to establish Consuls. 3. Article VI appears even more inconsistent with our Treaties with China. It stipulates that merchandize passing over the frontier at the points to be fixed will be subject "to duties inferior to those which are stipulated for by the actual Tariff on foreign trade." This reduced Tariff is not to apply in any case to goods passing over the frontier between Tonquin and Kouang-tong, this last being a province bordering on the sea, in which there is a Treaty port ; but it is to apply to the provinces of Yiinnan and Kouang-si, which are provinces more or less accessible to trade from the Treaty ports situate in the Province of Kouang-tong. Farther, this reduced Tariff "is not to have effect in the ports already opened by the Treaties" — in other words, there is to be a differential duty in favour of French trade between Tonquin and China at certain points of the land frontier, notwithstanding the above stipulation in the Treaty of Tien-tsin for most-favoured-nation treatment to British subjects in regard to duties. In the "Expos^des Motifs" the explanation suggested is that the Chinese Government is only following as regards France the practice already established in the Russo-Chinese Treaties regulating commerce on the land frontier between Russia and China, and verbally this appears to be true. The Russo-Chinese Treaties stipulate for complete freedom of commerce, including freedom from all duties over the greater part, if not the whole, of the land frontier between Russia and China. But without entering into the question whether the Russian Treaties themselves are not contrary to the English Treaties with China, as giving special privileges and advantages to Russian subjects, it is easy to perceive that concessions and regulations with regard to trade on a distant land frontier of China, through which foreign • trade with the central provinces of China would hardly be carried on, may mean a very different thing from the same concessions and regulations applied to a part of the Chinese frontier which gives access to the main provinces of China itself, and where the land trade may consequently come into competition with the trade of the Treaty ports. The intention to establish inequality, it may be noticed, is expressly avowed in the "Expose des Motifs" submitted to the French Legislature in support of the "Projet de Loi" ratifying the Treaty. "The difference," it is said, "is clearly explained by the consideration that the diminution of the I'ariffs is in some sort the compensation of the expense of land transport." In other words, trade is to be diverted from its natural channels by sea to a more expensive route by land. It is needless to point out that the cost of transport is of necessity a variable item, and will vary not only with different distances, and with different means of communication which now exist, but also with all improvements or changes which may hereafter be brought abbut in such means by railways or otherwise. Under cover of such a clause, it would not be difficult for the French and Chinese Governments to give a bounty on trade by the land frontier as compared with the Treaty ports, and a bounty which would be effective after deducting the extra cost of a route naturally less suitable. But, even if the present case were unimportant in its practical consequences, the principle involved in it is all-important. If stipulations for equal treatment in the matter of duties are to be made to depend on, and to vary with the cost of transit, there is an end to any certainty or clearness in the meaning of such stipulations. Cost of transit is one of the natural conditions under which trade is carried on ; and to give compensation by lower diities for higher cost of transit would be as injudicious as to give compensation for inferior soil or climate. The Board of Trade refrain from commenting on Article VII, whiclr stipulates that the Chinese Government is to address itself to French industry when it comes to construct 37 railways, since the qualification that " this clause is not to be considered as constituting an exclusive privilege in favour of France" appears to render the clause unmeaning. I have, &c. (Signed) HENRY G. CAIXRAFT. No. 54. The Marquis of Salisbury to Mr. 0' Conor, Sir, Foreign Office, August 6, 1885. WITH reference to my despatch of the 31st ultimo and to previous correspondenc in regard to the provisions of the Treaty of Peace signed at Tien-tsin on the 9th ultimo between China and France, I have to state to you that I have been in commumcation with -the Board of Trade as to their effect on British interests with reference to the frontier Tariff between Tonquin and China. The views of that Department are embodied in the letter, of which a copy is inclosed herewith* for your information and guidance in dealing with the various points to which attention is directed in that lettei-. I am, &c. (Signed) SALISBURY. No. 55. Sir P. Currie to Sir T. Farrer.f Sir, Foreign Office, August 7, 1885. WITH reference to my letter of the 28th ultimo, I transmit herewith, for the infor- mation of the Lords of the Committee of Privy Council for Trade, a copy of a despatch from Her Majesty's Charge d'Aflfaires at Peking on the question of the Tonquin-Chinese Frontier Tariff, together with a copy of the reply returned to it.$ I am, &c. (Signed) P. CURRIE. No. 56. Sir Villiers Lister to Sir R. Herbert. § Sir, Foreign Office, August 8, [ 885. WITH reference to the provisions of the Treaty of Peace signed at Tien-tsin on the 9th June between France and China, I am directed by the Marquis of Sahsbury to transmit to you, for the information of Colonel Stanley, a copy of a letter from the Board of Trade, embodying the views of that Department as to their effect on Britisli interests in regard to (he frontier Tariff between Tonquin and China. || A copy of that letter has been forwarded to Her Majesty's Charg6 d'Affaires at Peking, for his information and guidance. I am to add that a similar communication has been made to the India Office. I am, &c. (Signed) T. V. LISTER. No. 57. Mr, 0' Conor to Earl Granville. — (Received August II.) My Lord, _ Peking, June 17, 1885. I HAVE now the honour to inclose to your Lordship a" translation in English, for which I am indebted to Mr. Baber, Chinese Secretary to Her Majesty's Legation, of the Chinese text of the Treaty of Peace between France and China, which was signed at Tien-tsin on the 9th instant.^ * No. 53. t Also to India Office and Colonial Office. J Nos. 42 and 49. § Also to India Office, (| No. 53. f See Inclosure in No. 66. 38 Although this Treaty seems at first -sight a somewhat colourless document, it nevertheless appears, on closer examination, to concede to the French every advantage which they originally hoped to gain by their project of exercismg a Protectorate over lonqum. . ,. • , , , Out of the original scheme to open communications for commercial purposes by the Red River between Soath-western China and the coast of Tonquin, the occupation of the whole of Tonquin by France has now grown, and by the present Treaty this occupation is tacitly conceded by China. So far as the Chinese Government is concerned, the French are now free to take undisputed possession of all, or nearly all, the navigable waters of the Red River. The whole of Tonquin is to be placed under their subjection. The suzerainty of China over Annam, and oyer Tonquin, which is a province of Annara, is practically ignored in the Treaty, being reduced to its lowest expression in the form that " the honour and dignity of China shall not be prejudiced by the relations of France with Annam." French trade with Yiinnan and Kwangsi across the frontier is to enjoy an alleviation of duties, the details of the Tariff" remaining to be decided upon later on. It is, however, specially mentioned that " such reduction of duties is not to apply to the case of overland trade across the border between Kwangtung and Tonquin," and it is to be hoped that in the near future we may be able to obtain an open port on the Canton River whence British products can enter the Province of Kwangtung, and even compete on tolerably fair terms in Kwangsi and Yiinnan with those of France. Your Lordship will notice that, throughout this Treaty, Tonquin is always mentioned or alluded to as "under the protection of France." Such terms as "occupation" or " annexation " find no place in its clauses. But at the same lime, it is manifest that China fully recognizes the authority of France in Annfim and Tonquin. The trade clauses of the Treaty are reserved for future negotiation, and will form a Supplement to the present Treaty. These negotiations will begin very shortly, 1 believe, at Peking, and it will be my duty to watch their progress with all the attention that may be possible. The construction of railways in Tonquin to the Chinese frontier, contemplated in Article VIJ, will be profitable only in so far as future stipulations allow French products to enter Yiinnan and Kwangsi without being weighed down by the imposition of li-kin duties once they pass a certain distance from the frontier, and the appeal to France for assistanpe in the construction of railways in China would seem to be counterbalanced by the proviso that no exclusive advantages are thereby given to her to the prejudice of other foreign countries. Article III, which concerns the delimitation of the frontier by a Joint Commission, does not declare with any distinctness what is to be taken as the basis of the delimitation, and contemplates a certain " rectification " of the actual frontier. It is unlikely that an agreement on so delicate a point will be speedily reached. Six months are to elapse before the appointment of the Commissioners, and it is not until after the delimitation has been determined that the subjects of the two Powers will be free to cross the frontier under passport. I am inclined on the whole to regard the present Treaty as politically less interesting than the Li-Fournier Treaty of May 1884, while commercially much will depend on the result of the negotiations that are to form its Supplement. Your Lordship will, no doubt, be in possession of the French official text of the Treaty long before this reaches you, and, though the Chinese text from which the accompanying translation was made was not furnished by the Ministers of the Yam^n, I have no reason to doubt its accuracy, at any rate, in all the main stipulations. T have, &c. (Signed) N. R. O'CONOR. No. 68. Sir J. Walsham to the Marquis of Salisbury. —{Received AugUst 1 5.) %Lord, Paris, August Id, 18SB. WITH reference to the Parliamentary Paper inclosed in Lord Lyons' despatch of th^ 24th ultimo, containing a copy of the Treaty between France and China signed at Tien-tsin on the 9th June last, and also copies of certain official documents bearing \mott the Treaty, 1 have the honour to report that, according to the accompanying statement pubfished in the official Journal of to-day, M. Cogordan, one of the Sub-Directors of 39 the Political Department of the Ministry for Foreign Affaifs, has been appointed to conduct the negotiations for concluding a formal Treaty of Commerce between the two countries. He will be assisted by Mr, Consul Bauwaert. I have, &c. (Signed) JOHN WALSHAM. Ipclosure in No. 58. Extract from the "Journal Oflciel" of August 13, 1885, PAR Arr^t6 du Ministre des Affaires Btrangeres, en date du 5 AoAt, 1885, M. Gogordan (George), Souis-Directeur h la Direction des Affaires Politiques, a 6t6 charg^ de la ridgociation du Traitd de Commerce avec la Chine. II sera assist^ de M. Bauwaert (Frangois-Edmond), Consul de Premiere Clasge. (Translation.) BY order of the Minister for Foreign Affairs, bearing date the 5th August, 1885, M. George Cogordan, Sub-Director in the Political Affairs Department, has been intrusted with the negotiation of the Treaty of Commerce with China. He will be assisted by Mr. Francis Edmond Bauwaert, Consul of the First Class. No. 59, Mr, Meade to Mr. Currie, — {Received August 20.) Sir, Downing Street, August 18, 1885. I AM directed by Secretary Colonel Stanley to acknowledge the receipt of your letters of the 28th and 31st ultimo and of the 7th, and 8th instant* on the subject pf the Treaty between France and China, and of the effect which it may have on the trade of England and the Colonies with China, 2. Colonel Stanley presumes that the qqeptjon whether the Treaity will, if exceptional advantages are given to France by land, affect prejudicially oijr trade with Burinah either direct from Tonquin or through China, as well as our trade wjth China Jtsglf, will have engaged the attention of the India Office and Foreign Office, I am, &c, (Signed) R. H, MEADE. No. 60. Mr, Qurrie to Mr. Meade, Sir, Foreign Office, August 24, 1 885. WITH reference to your letter of the 18th instant, I am directed by the Marquis of Salisbury to state to you, for the information of Colonel Stanley, that this Department is in correspondence with the India Office on the question of the extent to which British trade with Burmah will be affected by the Treaty between France and China. I am, &c. (Signed) P. CURRIE. No, 61. Sir B. Herbert to Mr, Currie.— ^^(Beceived September 1.) Sir, Downing Street, August 31, 1885. WITH reference to the letter fi?om this Department of the 24th ultimo, I am directed by the Secretary pf State for tbe Colonies to transmit to you, for the consideration of the * See Nos. 49, 51, 55, and 56. 40 Marquis of Salisbury, copy of a despatch from the Governor of Hong Kong on the subject of the new Treaty between France and China, I am, &c. (Signed) ROBERT G. W. HERBERT. Jnclosure 1 in No. 61. Administrator Cameron to the Earl of Derby. My Lord, Government House, Hong Kong, July 23, 1885. WITH reference to your Lordship's telegram of the 17th instant, I have the honour to forward to yoii a copy of a letter, and its inclosure, from the Hong Kong General Chamber of Gommerce, relative to the recent Treaty betweeu France and Chinai the official text of which I am not possessed of, but only of what purports to be a translation from the Chinese, forwarded to Sir George Bowen confidentially by Mr. O'Conor, Her Majesty's Charg^ d'Affaires at Peking. 2. With regard to the Imperial aspect of the question, apart from commercial interests, I am not at present in a position to afford any information which is likely to be useful to Her Majesty's Government. Should, however, anything of consequence transpire, I will not fail to report it immediately. ■ I have, &c. (Signed) W. G. CAMERON, Major- General. Inclosure 2 in No. 61. Mr. Keswick to the Acting Colonial Secretary. Hong Kong General Chamber of Commerce, Hong Kong, Sir, July 22, 1885. I HAVE the honour to acknowledge the receipt of your letter of the 18th instant, forwarding confidentially a copy of the Treaty between France and China recently entered into, and requesting the opinion of the Chamber upon the document from a commercial point of view. The Committee are obliged to his Excellency the Administrator for the opportunity of expressing the views of the Chamber, but without knowing something of the nature of the Regulations, &c., which are to be drawn up by special Commissioners under Article VI, it is difficult to say more than that the commercial clauses of the Treaty appear to have been framed in a liberal and progressive spirit. There are special privileges to the French implied by a reduction of duties, below those paid at the Ti'eaty ports of China, on the frontier trade between Tonquin, Yiinnan, and Kwangsi, and the right to appoint Consular officers at certain places in these provinces is important. The latter right will, under the favoured nation clause, become the privilege also of other nations having Treaties with China, but the differential rate l)etween maritime and frontier duties will hardly become applicable under these clauses unless the Chinese, as has been urged by this Chamber, open up the water communications of Kwantnng into Western China, when directly conveyed merchandize should become subject to no greater dutv than is borne by goods crossing the frontier by land. This frontier trade, and the occupation of Tonquin by France, again bring to the front the question of representing to China the importance of no longer hesitating to open to foreign enterprise the navigable waters of China generally, but more especially the rivers of the southern provinces. On the 3rd July of last year the Chamber addressed the late Sir Harry Parkes, Her Britannic Majesty's Minister Plenipotentiary at Peking, on this subject, when the Fournier Convention was announced, and the Committee inclose a copy of the letter, as it bears directly on the Treaty now under consideration. The concluding portion of Article VJ, touching the coasting trade between China and Annam, is of special importance to this Colony, the shipping interests of which are so great, and her Majesty's Government should watch with jealous care that the Colony is no less favourably placed than it always has been in regard to coast traffic and intercourse with the territories now under French protection. I have, &c. (Signed) W. KESWICK, Chairman. 41 No. 63. Mr. 0' Conor to the Marquis of Salisbury. — {Received Kovemher 3.) My Lord, Peking, Sf'pl ember 9, 1885. 1 HAVE the honour, to inclose a translation of two Decrees which appealed in the " Peking Gazette " of the 29th ultimo, appointing two officers of the Central Government, one an ex-Minister of the Tsung-li V'anien, and the other at present on that hoard, as joint Commissioners v^ith the High Authoiities of Yunnan and Kwangsi for the delimitation of the Chinese and Tonquin frontiers. J understand that these two officers are startim: from Peking in four or five days, and will proceed vi^ Canton to Wu-chou, and thence to the Irontier of Tonquin, to meet the French Conimissioncrs from the other side. From current reports the frontier is in a very disturbed condition at the present moment, and it seems doubtful whether they will be able to reach it on either side without some risk and danger, I have, &c. (Signed) N. R. O'CONOR. . Inclosure in No. 62. Decree published in the "Peking Gazette " of August 29, 1885. (Translation.) 1. THK following Decree has been respectfully received : — " We command that Chou Te-jun, Sub-Chancellor of the Grand Secretariat, proceed with all speed to Yunnan, and, in conjunction with Ts'6n Yii-ying and Chang K'ai-sung, make arrangements for the survey of the frontier between China and Annam. ■ '* We also command that T'ang Ching-sung, a Second-class Assistant Secretary of the Board of Civil Office, with brevet rank of Director of one of the minor metropolian courts, wearing a button of the fifth grade, and YshTing-chuan, a probationary '^I'aotai in Siangsu, be associated with the above officers, and proceed with all speed to their destination in company with the staff of Chou T6-jun." 2. The following Decree has been respectfully received : — " We command that Teng Ch'^ng-hsiu, Director of the Court of State Ceremonial, proceed with all speed to Kwanjisi, and. in concert with Chang Chih-tung and Li Ping- h6ng, take part in the survey of the frontier between China and Annam. "We also command that Wang Chih-ch'un, Grain Intendant of Kwangtung, and Li Hsing-jui, and expectant Taotai of Chihli, be associated with the above officers, and proceed with all haste to their destination in company with the staff of Ting Ch'Ing-hsiu." No. 63. Mr. O'Conor to the Marquis of Salisbury. — {Received November 3.) My Lord, Peking, September 8, 1885. SOME weeks ago I instructed Mr. Consul Gardner to report to me on the probable effect of the commercial stipulations of the Treaty recently concluded between France and China upon the trade vi& Canton with the inland markets of Kwangtung, Kwangsi, and Yunnan, and to inform me how far he considered that the openmg. of a Treaty port on the West River — as, for instance, Wuchow — would counterbalance the advantages secured to the French by the present 'J'reaty. ! In reply to the above questions, Mr. Gardner is distinctly of opinion that the stipula- tions alluded to will have no serious effect upon the trade via Canton with the inland markets, and is inclined to believe that the establishment of a Treaty port on the Wfest River would counterbalance the advantages accruing to the French under the late Agreement. To support this opinion, Mr. Gardner alleges that the inland trade between Kwangtung and Tonquin is insignificant, being a very small interchange of commodities between the Lien-chow Prefecture in Kwangtung and the Quangyen Province in Tonquin. Mr. Gardner considers that the few foreign goods required by the natives of Quangyen will continue, as heretofore, to reach them neither from Canton nor the French ports in Tonquin, but from Hong Kons, through Pakhoi. [177] & ^2 Referring to the trade of Kwangsi, Mr. Gardner expects that the populous southern corner of that province (including the Prefectures of Tai-ping, Nan-ning, Chin-ngan, Sz-ngan, &c.) will continue to receive its imports from Hong Kong by two routes, viz., the West River and the land route vi^ the port of Pakhoi. With leference to Yiinnan, Mr. Gardner derives his conclusions from an officer of the Imperial Chinese army, who is of opinion that the wealth of Yunnan consists in its mines of lead, copper, and tin, which are at present inadequately worked ; even if the hopes entertained by the French as to mineral wealth and a future large population in Yunnan are realized, this will not, in his opinion, prejudice the trade of Canton. That port will still be in a position to compete, not unfavourably, with the French ports in Tonquin in supplying, by way of the West River, such Increased population with the commodities it will require. I would here beg attention to the fact that Northern Yunnan is easily accessible by the Yang-tse River, a trade route which has been strangely ignored, partly in consequence of the erroneous dehneation of maps, and partly from a mistaken idea that the rapids of the Upper Yang-tse oppose an almost insurmountable obstructiou to water traffic. The northernmost department of Yunnan, namely, Chautung, is bounded on the north by the Yang-tse, and with regard to the danger incurred by junks ascending or descending the rapids, I need only remark that nearly the whole import and export trade of the rich Province of Ssu-ch'uan, the largest province in China, is conveyed through those rapids, which, indeed, are only formidable during two of the summer months. This point, which bears very strongly on the development of trade with Western China, deserves more than passing reference. But for the moment I confine myself to a quotation from a trade Report by Mr. Spence, in which he remarks : " I have been up and down them (the rapids of the Yang-tse), in Chinese junks, at all seasons of the year — in the height of the summer freshet and at the lowest winter level — and I am firmly convinced ot their practicability for small, handy, light-draft, full- powered steamers, during nine months of the year, without the aid of more than tbe ordinary methods of steam navigation." This statement is supported by the authority of Mr. Yankowski, a Yang-tse pilot, the only expert who has examined the rapids at various seasons of the year. Chautung is considered to be "the most populous and richest part of Yunnan." Mr. Baber informs me that the same Department is very rich in mineral wealth, as yet slightly developed, and that the minerals must always find their exit, as they do at present, down the Yang-tse. Mr. Clement Allen, Her Majesty's Consul at Pakhoi, in a Report on the same subject, which I had desired him to draw up, treats the question with more especial reference to the effect which the facilities given to France by the Franco-Chinese Treaty will exercise upon British trade in Pakhoi. He takes a somewhat gloomy view of the present condition of that port, but is satisfied that it is perfectly possible, by means of a lighter and more equitable system of inland duties and an honest and liberal observ ance by the local functionaries of the transit-pass clause of the Treaty of Tien-tsin, and still more by the construction of roads, to build up the trade of Pakhoi into one of great value. Pakhoi possesses one great advantage over any of the Tonquin ports, viz., the good approach to its harbour, which can be entered at any time of the tide in a 5-fathom channel, without pilotage. Mr. Allen and Mr. Gardner both draw attention to the consideration that, in China, geographical facilities are often less important factors of trade routes than financial arrangements, and with reference to this fact I venture to quote a remark of Sir Thomas Wade upon the introduction of trade by the Tonquin River. " That river," he observed " presented considerable physical difficulties, and in addition there was the difficulty of a double fiscal system, as the French would, of course, collect duties at their (Tonquinese) ports." He spoke without the smallest jealousy in this matter, for, after spending more than forty years in China, he had come to the con<;lusion that there was room enough for all ; and supposing that the French did make that a great trade route, it would be for the scruth-eastern section of Yiinnan and nothing else." (Proceedings of the Royal Geo- graphical Society, December 1882.) So far as his argument extends I am disposed, in tlie main, to agree with Mr. Gardner's conclusions. I see no reason to apprehend any immediate prejudice to the interests of British trade with Kwangtung ; but our commercial relations both with that province and with Kwangsi would, 1 am disposed to think, be strengthened by the establishment of a Treaty port on the West River «t the highest point, of any commercial importance, accessible by steamers. It will be observed tliat Mr. Gardner does not discuss the conditions which would 43 arise from the construction of railways by the French in Tonquin. If that scheme be cai'ried into effect, it seems probable that a monopoly of the trade of at least Southern Yunnan, including the capital, will fall into French hands. But on the subject of the trading possibilities of Southern Yiinnan and Western Kwangsi, and the condition of the population, we possess little beyond the vaguest knowledge, for which reason 1 have already ventured to suggest that a Consular officer might very profitably be instructed to proceed to those districts and to report upon their commercial condition and capacities, for the information of Her Majesty's Governnaent. ' I have, &c. (Signed) N. R, O'CONOR. P.S. — I have the honour to forward to your Lordship herewith the reports of Messrs. Gardner and Allen, referred to in the preceding remarks. N. R. O'C. Inclosure 1 in No. 63, Consul Gardner to Mr. 0' Conor. Sir, Canton, 'August 5, 1885. I HAVE the honour to acknowledge receipt of your despatch of the 24th June, directing me to furnish you with remarks on the effect of the commercial stipulations (Articles V and VI) of the Treaty recently concluded between France and China upon the trade, vigi Canton, with the inland markets of Kwangtung, Kwangsi, and Yiinnan, and how far I considered the opening of a Treaty port on the West River — as, for instance, Wuchow — ^vs'ould counterbalance the advantages secured to the French by the present Treaty. I crave your indulgence as to the time I shall be able to forward the detailed Report, with maps, I am now preparing, and only venture at present to lay before you certain views formed on the broader and more prominent facts. I do not think the stipulations alluded to will have an appreciable effect on the trade, vik Canton, with the inland markets of Kwangtung, Kwangsi, and Yiinnan, and I am inclined to believe that the opening of a Treaty port on the West River — say, at Wuchow — would counterbalance the advantages secured to the French by the present Treaty. The inland trade between Kwangtung and Tonquin is insignificant ; it is a very small interchange of commodities between the Lien-chow Prefecture in Kwangtung and the Quangyen Province in Tonquin. The Quangyen Province is sparsely inhabited, mostly by Hakkas, whose wants are simple ; the few Manchester and foreign goods they consume will, I think, as hitherto, reach them neither from Canton nor the French ports in Tonquin, but from Hong Kong, Macao, and Pakhoi. As to the inland trade between Kwangsi and Yunnan I have not yet ascertained how far the Thai-ninh, or Langson, River is navigable. It is navigable, at all events, to Kwang-li-chiao, just above Bac-li. I am told that it is not navigable even to Langson. Above Langson the country is but sparsely populated. The populous south-west corner of Kwangsi (comprising the Prefectures of Tai-ping Nan-ning, Chin-ngan, Tien-chow, and Sz-ngan) will, I think, continue to receive its imports by the West River from Hong Kong, Macao, and Pakhoi, and will discharge its exports vi4 Canton. A southern branch of the West River* is navigable to Lung-chou, and from thence foreign goods are imported into Tonquin through the duty station on the frontier called Chen-nan Kuan. As to the inland trade between Tonquin and Yunnan, I do not think that for many years to come it will assume important dimensions. I doubt whether it will ever be as great as the French expect. The Yiinnan Province is not densely populated, and I do not consider that more than a portion of its trade is ever likely to pass through Tonquin. A great portion of Yiinnan is mountainous and sterile. I hear that many of the plains are uncultivated, and covered with jungle or long grass. The principal crops are grown on terraces of the lower hills. The towns of Yunnan are neither numerous nor very populous. The great wealth Of the province consists in its mines of galena, copper, tin, &c, ; these mines are not at present fully worked. Even if the bright hopes the French entertain as to the mineral wealth and future large population are realized, this will not injuriously affect Canton ; while Hong Kong, Macao, and Pakhoi will be able to * The Tso River, an affluent of the Ngo-yii River, which latter is the atmthcrn hranch of the West River. [177] G 2 44 compete favourably with the French ports in Tonquin in supplying, by way of the West Ili/er, such increased population with the commodities it requires. With Yunnan tl.e trade routes follow four rivers : the Irrawaddy, the Upper Yang-tse, the West River and its afiiuents, and the Song-koi.* Tiie tiade by the Irrawaddy only affects the extreme west of Yiinnan, and is partly carried by the Nan-ta-ping River. .It is considered that the present trade would justifv tiie making of good roads between Bhamo and Momein (T'eng-yiieh), but that it would not pav to carry these roads on to Ta-li Fu,as between Ta-li Fu and Momein there are six difficult >anges of mountains to cross. The trade by the Ufjper Yang-tse aflTects the north of Yunnan, including the Prefecture of Chautun^, which General Mesny states is the most populous and richest part of Yiinnan ; but a few of our goods find their way by that route, even as far south as Vtinnan Fu. It is uortiiy of remark that goods should fake this long route, involving transhipment at Shcinshae, Hankow, and Ichang, and then go throu£;h the formidable rapids below and above Ch'ung King. It is still more worthy of remark that the greater portion of the trade between Yunnan and the Upper Yang-tse goes by the route followed by M. Rocher in 1871 ; that is, the commodities are again transhipped at Na-chi Hsien, go up the Y'ung-ning River to Yung-ning Hsien, whence ihey are conveyed by mule-back through a corner of Kwei-chow to the various markets in Yiinnan. The cost of conveyance from Yung-ning Hsien to Yiinnan Fu is 7 taels per customary picul of 1,>0 catties. The lesser poition of the trade only finds its way by the easier route of Hsii-chow. (The route followed by Messrs. [jagiee and Gamier in 1867-68.) I am informed that the preference tor the Yung-ning route is due to the heavy imposts levied at Ta Kwan. The trade by the West River would, if things depended entirely on geographical considerations, affect only the east of Yiinnan. There are two branches of the West River flowing together at Ling-an Hsien by which communication can be had with Yiinnan. The northern branch is the Hung-shui River, the southern is the Ngo-yu. I am informed that, though the Hung-shui River has the disadvantage of some formidable rapids, there was formerly a great local traffic on it ; that this traffic has at present nearly ceased is considered due rather to the depopulations caused by disorders than to the difliculties of navigation, and it is believed that now order has been restored the traffic will revive. On the Ngo-yii River there is a very large traffic. It is navigable by large boats to Pai-hsieh T'ing, and thence by small boats or canoes, carrying I ton or so, to Si-lin. Chinese merchants at Pai-hsieh T'ing state that the itnport trade to that mart last year amounted in value to 2,000,000 taels, one-half of which was forwarded to various markets in Yiinnan, the other half was consumed locally and in Kwei-chou. Pai-hsieh T'ing is only two or three days' journey from the town of Kwang-nau, and is still nearer the town of Kwei-chou in Yiinnan. According to M. Dupuis, Pai-hsieh T'ing is nineteen, according to General Mesny twenty-two, days from Yiinnan Fu. The cost of transporting merchandize from Pai-hsieh T'ing to Yunnan Fu is about 6 taels the customary picul of 120 catties. The main branch of the Song-koi River would be the natural outlet of the trade of south and central Yiinnan. On tlie other hand, I do not think its eastern affluents, the Chin-ho and Nan-si Ho, can be thus utilized. f The Ching-ho, or Blue River, has its source in the hills above Kai-hwa, and flows into the Song-koi River just above Sontay. Only a very small portion of the Ching-ho is navigable, but Kai-hwa itself is a very poor place, and the little trade it does is done entirely with Pai-hsien T'ing on the West River by way of Kwang-nau. The Nan-si Ho flows into the Song-koi by Lao-kai, and is not navigable. The Song- koi River, on the other hand, in spite of a few not formidable rapids above Lao-kai, is navigable, except in very dry seasons, in December and January, by large boats as far as Mong-hwa (or Man-hao, Mong-ko, Man-hai, &c., as it is variously spelt). Mong-hwa is the point of juncture of the Ho-ti and Li-seen rivers. The Ho-ti River is, by landing cargo at rapids, navigable by skiff or canoes to Pakang, where there is a custom-house. This custom-house is about 30 miles south-west of Liu-ngan, and about 40 miles south-east of Yiian-chiang Chou. The Li-seen River passes through Pu-urh, the * I do not mention the Yiian River flowing into the Tung-ting Lake, though it was the route taken by Mr. Margary, because the long land journey across Kwei-chou bars carriage of commodities. t The very valuable Map of M. Gamier attached to "Voyage d'Exploration en Indo-Chine" (Paris 1873) does not give the course of these two streams quite accurately. They are given accurately in M. Dupuis' •' La Conqufete de Tonquin, par Vingt-sept Frangais, 1880." 45 most southerly district of Yunnan, which produces the celebrated Pu-urh tea mentioned in my Ichang Trade Eeport for 15:^83. The Li-seen River is only navigable by skiffs and canoes, and I have not ascertained how far it is navigable by them. Most of the trade between Tonquin and Yiinoan will, 1 think, be by water as far as MoDg-hwaj and thence by porter or mule back to the various marts in Yiinnan. From Mong-hwa to YUnnan-Fu the journey by land is easy, and occupies, according to M. Dupuis, eight days ; according to others, eleven. The cost of conveyance of the customary picul of 120 catties is about 3 taels or so. Close to Mong-hwa there are the rich tin mines of the Mong-tsze district, which are now in fair working order. Yet Pai-hsieh Ting, in spite of its distance, absorbs at present most of the produce of these mines. The conclusion I am tempted to draw^ from the above facts is that, considering that in China geographical facilities are often less important factors of routes of trade than financial arrangements, and considering also that for various reasons it will not be to the interest of the provincial authorities of Yiinnan to favour the route by the Song-koi River, most of the trade with Yunnan will be conducted by the West River.* With regard to the desirability of opening a Treaty port on the West River, 1 think if this is done Wu-chou should be the point selected. In the first place, because 1 am told that Wu-chou is about the highest point of the West River easily reachable by steamers. Secondly, because Wu-chou is situated at the junction of the West River and the Fu River. The Fu River is itself an important waterway flowing through a rich district and passing various populous towns such as Kwei-lin, &c. Its importance was greatly increased some years ago by the digging of a canal connecting it with the Siang River, which, after passing the important towns of Yung-chow, Heng Chow, and Chang-sha, flows into the Tung-ting Lake. The Canton boats I saw at Ichang in 1873 had come from Canton by the above route. The opening of Wu-chou as a Treaty port would possibly cause a loss in trade to Canton in exports, especially tea, and to Hankow in both imports and exports. I fear it would not increase to any great extent the bulk of our trade with China. Our goods already reach Wu-chou pretty freely, and as for the native produce that passes through Wu-chou, it has only a very few extra miles of inexpensive waterway to find its outlet by Canton. The reasons for it coming to Canton are the extra duties charged on junks and cargoes clearing thence for Hong Kong and Macao. In conclusion, I have to express my thanks to General Mesny for the very obliging manner in which he furnished me with information. I have, &c. (Signed) C. T. GARDNER. Inclosure 2 in No. 63. Consul Allen to Mr. 0' Conor. Sir, Pakhoi, Auyust 13, 1885. I HAVE the honour to acknowledge receipt of your despatch of the 13th July, 1885, calling on me to I'eport on the effect which I consider the facilities given to France by the Franco-Chinese Treaty of Peace will have on British trade in Pakhoi and the districts in commercial communication with it. I will perform this task to the best of my ability, but if any conclusions at which I may arrive shall evcHtually be proved erroneous, I will ask you to bear in mind that my sources of information are neither complete nor perfectly accurate, and that prediction is, at the best of times, liable to lead one into error. I have not been supplied with an authentic copy of Article VII of the above Treaty, but the Article, as given in the "North China Herald," asserts the immediate construction of a railway in the north of Tonquin. In this report, therefore, I assume that the French will at once make such communications as the country is best fitted for, be they water routes, horse roads, or railways, and that, whatever duties tiiey may impose, they will grant every facility of locomotion. I may take it for granted that Her Majesty's Government, in opening Pakhoi, never intended it to be simply a port to supply the neighbourhood with yarn, opium, and piece- goods, and to procure thence a little cassia and aniseed and a few hides, but rather to be * It is observable that the French Treaty only stipulates wliat duties are to be levied at the Customs stations on the frontier. Goods after passing such Customs stations will still be subject to the local provincial taxation. 46 the shipping port of south-west China. Hitherto, these hopes have been unfulfilled. I do not suppose that foreign goods often penetrate more than 150 miles into the interior. The exports intended for a foreign market come almost entirely from the Yii-lin and Nan-ning districts, more from Yii-lin than Nan-ning. The shipping trade is monopolized by the Macao Guild, who run the three little steamers (two of which are German) which ply between this, Hoihow, Macao, and Hong Kong. Their export cargo consists principally of ground-nut cake, liquid indigo, and sugar, all to be consumed by Chinese in the neigh- bourhood of Canton and Hong Kong. The trade is only enough to give a precarious living to one British merchant, and to a German, who has lately started in business. The native merchants are dealers on a small scale. The richer of them are agents for the members of the Macao Guild. I cannot think that Her Majesty's Government would consider these nieagre results sufficient to compensate the expense of establishing a Consulate, and stationing a man-of- war here from time to time, were it not that they look on Pakhoi as an outpost whence British trade may advance into the large and undeveloped districts of south-west China. In my Report on the trade of Pakhoi in 1884, I have fully detailed the obstacles, natural and artificial, against the proposed advance. These hindrances are capable of being diminished by the action of the authorities. The want of good water communication may be overcome by the construction of a railway or good macadamized roads, and the burden- some and unequal duties now in force may be changed for a light and equitable taritT, and the transit pass clauses of the Treaty of Tien-tsin may be carried out in an honest and liberal spirit. Until these things are done, Pakhoi cannot be a place of any importance, and if these are not only not done, but there is a port opened close by, whence communi- cation with Kuangsi and Yunnan may be had, and whence a railway will carry goods safely into the interior, at a moderate rate of freight, Pakhoi must either be content to remain at a level even lower than its present level, or it must make a start in rivalry. The question of taxation is the most important point. The route on which dues are the lightest will infallibly carry away trade from the others. Kuei-lin, for instance, takes goods under transit pass from Hankow, though to reach the city on that route these goods have to traverse 2,000 miles more than they would have to go via Canton or Pakhoi, but the lifkin and barrier dues on the two latter roads stop the transit. The duties to be levied on goods passing through Annam and imported or exported across the frontiers of Yiinnan or Kuangsi are of course not yet announced, nor can I give those now in force on goods carried inland from Pakhoi with the accuracy that I could wish. Suffice it to say that after an import duty and li-kin of 1^ per cent, ad valorem at Pakhoi, goods are liable to a fresh charge at every li-kin station and inland barrier passed in transitu. To show the universality and the oppressiveness of these dues, I may state that when the inhabitants of Pakhoi fled out of the town to Lieu-chou on the approach of the French blockading squadron, taking with them their goods and chattels, Zi-fcin was charged on all their possessions by the Lieu-chou authorities. I have tried in vain to get an exhaustive list of all the stations, hni neither the Custom-house officials nor the foreign merchants know all their names, and if the native merchants know, in spite of their professions of ignorance, they will not tell me. Their reticence is accounted for by the fact that carriers of goods try to shp round and evade these taxing places. Mr. Herton gives me the only trustworthy piece of intelligence that I can obtain. On a consignment of yarn, shirtings, and needles, value 770 dollars, sent to Yunnan Fu, he paid the following charges : — Import and transit dues Dues charged at Yiinnan Fu . . Coolie and boat-hire . . , , Interest for five months . . . . . . Total ,, .. .. .. ., .. 386 25 Prom li-kin dues being charged at Yiinnan Fu alone, I have no doubt that the men in charge of the goods evaded every station en route. Next comes the question of freight and charges. The expense of porterage and boat hire between this and Yiinnan is, so the Chinese assure me, as much as 1 5 taels per picul, say 45/. per ton dead weight. The amount paid by Mr. Herton goes to show that this is scarcely an exaggeration. The journey from Pakhoi to Yunnan Fu occupies forty-six days. The custom of the trade is to pay, not in cash, but in native opium, which is sold at Kao-Chow, whence the cash is at last remitted. Thus the Pakhoi merchant is kept out of his money for four or five montlis. Interest at the rate of 1 per cent, a month will cause a deduction of five per cent, from the profits. Add to these charges the heavy Dol. c. 57 75 90 00 200 00 38 50 47 and uncertain dues, and the only conclusion to which a reasonable man can come is that no route ever had a better chance of success than the projected one through Tonquin into the soutl>-west provinces, always provided that the new Treaty is honestly carried out, and that the reduction in taxation is real and not nominal, I conclude, therefore, that if things remain as they are at Pakhoi, and the Tonquin railway is built, this port may as well be closed, but ; as I said before, our commercial con- dition may be improved, either by the construction of a rival railway, or by the reduction of taxation, or, what is the same thing, the issue of transit passes, which the inland authorities will respect. We have been so accustomed to look on railway enterprise in China as visionary, that the idea of constructing a railway from this seems about as hopeful as the scheme of flooding the Sahara, A short time ago, I was assured most positively that the High Provincial Authorities had the construction of a railroad in contemplation here. I pooh-poohed the notion, but he became all the more persistent, and begged me to report it to you. I wrote the draft of a despatch doing so, but before sending it I went to call on his successor, Wu Weiyuan, and found Hsii Weiyuan with him. I broached the subject of railways, but Hsii had by this time changed his tone, and merely said that it would be a very good thing for Pakhoi if one could be made, but that he was too small an official to make any positive statement. It may be that he was afraid to speak out in the presence of his colleague, who professed utter ignorance of the matter ; but his change. of manner confirmed me in the view that his former assertion was merely romance, and so I tore up the Report which I had prepared. Individually, I have no expectation of a railway, though I would thankfully be disappointed. The abatement of charges on exports and imports, especially on the lattei', is a more hopeful business. Mr. Herton assures me that though only three inward transit passes were issued by the Customs last year, yet the report that the Li-kin authorities had been called on to make good his claims (although he has not yet received the money) will cause transit passes in future to be valid, and that when this is once effected, yarn and T-cloths, kerosene and matches, vail go up country in quantities. M. Schonburg too, his only rival, a German, has started in business on August 1, with the express intention of profiting by this improved state of affairs. I wish them the success which they anticipate with all my heart, but more capital than they can command must be embarked in the trade, before it will assume its proper dimensions. I will now make a few remarks on the geographical part of my subject. I do not inclose a Map of the country, as I presume the Legation is well supplied in that particular. The map I principally use is Mr. Pirie's valuable Map of the Kwangsi Province, to which I have the honour to refer you. Practically, there are only two roads out of Pakhoi: one via Lieu-chou to Yii-lin, the other to Nan-ning, which may be reached in two ways, either viaLieu-chou, Ling Shan-hsien and the West River, or by crossing the bay to Ch'iu«-ch'ou, and then going direct to Nan-ning. The latter is rather shorter, but is the more expensive route. The Yii-lin road is comparatively unimportant. Cassia and aniseed come down that way, but Yii-lin is a complete terminus for imports, as Hsun-chon Fu and Wu-chon Fu, the next districts, are supplied from Canton, and the country further north— Kuei Lin Fu, the provincial capital — divides its trade between Canton and the Yang-tse ports. Nan-ning, on the other hand, instead of being a terminus, is a distributing centre. Its merchants come or send to Pakhoi on one side, and trade with Yiinnan on the other. The route from Nan-ning onwards is up the Tso Chiang, past T'ai P'ing Fu. I have a list of halting-places between Pakhoi and Yiinnan Fu, but none of thpm are to be identified by Mr. Pirie's Map. They are doubtless the smallest hamlets, chosen in order to avoid li-Mn stations and customs barriers. The Yii-lin road need not be considered. This road trends eastward, and such as it is, it belongs to Pakhoi, and nothing can interfere with it. The route to Nan-ning and on to Yiinnan is on a different footing, for a road into Yiinnan from Ha-lung Bay, if it can be made as the crow flies, would be only half or two-thirds of the distance from Pakhoi to the same place. The physical difficulties I know little of, except that the country traversed by M. Aumoitte seemed by no means well calculated for railway construction. If M. Dutreuil de Rhin's map, published under the authority of Admiral Jaureguiberry, may- be trusted (it is most incorrect on the China side). There is already a road running from the coast up to Langsun, interrupted by no large rivers or mountain ranges, and following the oourse of the River Tarn. A road, rail, or otherwise could apparently be made on this line, reaching the Yiiniian frontier, and branching off at intervals to the Kuangsi boundaries. Of course the most natural and direclest way into Yiinnan is up the Song Koi cr Red River, but I fail to see how tiiis can be combined with a road to Kuangsij which has no river co.umnnication with Tonquin. JText, as to the natural productions of the two provinces in question. Yiinnan seems 48 to have three very valuable products— native opium, tin, and copper. The gold, silver, and precious stones which the Chinese say are to be found, may or may not exist. _ Jade- stone undoubtedly does. The country is rugged and precipitous almost beyond belief, and the population is scanty, the whole province having been devastated during the Mahom- medan rebellion. Still, its mineral wealth in tin and copper alone is sufficient to supply a paying export trade, and, no doubt, the carriage of native opium to other parts of China will give plenty of employment to land-carriers, and to vessels afloat. Kuangsi, on the other hand, is a province rich in vegetable productions, and reasonably populous and wealthy. Ot tlie mineral wealth of the province 1 know nothing, except that no minerals produced in Kuangsi appear among Pakhoi exports. There are districts in the province producing tea and silk. The route which can attract these articles will assuredly make a profit. 1 have the honour to inclose copy of a cutting from an article in the "China iVIaii," signed " Pamuge,"* who writes from Tien-lsin. lam unable to identify the writer, but he writes as thoujih he had a knowledge of his subject, though I do not know to what he refers when he speaks of " the jealousies of the foreign Ministers in Peking." I quite agree with him that if Kuangsi can be properly opened, its shipping port will secure a lucrative trade. Pakhoi has one advantage over any of the Tonquin ports, viz., the good approach to the harbour, which can be entered at any time of the tide in a 5-fathom channel. No pilots are employed. At Haiphong, on the contrary, pilotage on a small steamer inwards and outwards, amounts to 60 dollars and upwards. With regard to the latter clauses of the \ Itli Article of the Treaty I have not much to say. J'he regulations regarding the sale and transport of munitions of war call for no remark. The special clause of the Trade Regulations affecting the import and export of opium, will, I venture to predict, concern the export of opium more than the import. Kuangsi will take hut little Indian opium, and to import it into Yunnan would be " carrying coals to Newcastle." The question of the coasting trade may be of great importance. As it is, a large proportion of the coasting trade between this and Hong Kong and Macao is done by junks, which pay duty at the native Custom-house, and are granted a discount which enables them to compete on favourable terms with steamers. These junks belong to the Macao Guild. They are allowed a discount of 9 taels on the duty of 30 taels per chest on all the opium they carry, and aniseed oil, which is charged 5 taels per picul at the foreign Custom-house, only pays 1 tael at the native Custom-house when it is exported by junk. I sincerely hope and trust that the French will never allow junk-borne cargo a favourable differential scale of duties, and, further, that they will do all in their power to break the monopoly of the Macao Guild, which hampers and obstructs the development of trade (?n this coast. To sum up, I hold that : — 1 . That Pakhoi, under present conditions, is in no position to develop her trade with Kuangsi and Yiinnan. 2. That her trade with the neighbouring districts is scarcely worth the expense of a Maritime Custom house, a Consulate, and a vessel of war. 3. That it is perfectly possible, by means of lighter duties, observance of transit passes, and, still more, by the construction of roads or railro.ads, to build up the trade of Pakhoi into one of great value. 4. That if a trade route from Tonquin into Kuangsi and Yunnan is established and developed, while nothing is done here, Pakhoi must remain the port of the immediate neighbourhood (a poverty-stricken country), and of the Yii-lin district onl)-, which would be equivalent to a collapse of all our hopes and expectations. 1 have, &c. (Signed) CLEMENT F. R. ALLEN. No. 64. Mr. 0' Conor to the Marquis of Salisbury. — {Received December 28.) My L(Jrd,. Peking, November 10, 1885. I HAVE the honour to inform your Lordship that M. Cogordan, Plenipotentiary of the Government of the French Republic, arrived here on the 5th instant, and was received by the Prince and Ministers of the Yamen on the 8th instant. I understand that M. Cogordan will remain in Peking about a month, but that the * Not pnnted. 49 negotiations for the Commercial Treaty between France and China will be carried on at Tien-tsin, the Yiceroy Li Hung-chang acting as Plenipotentiary of the Chinese Government, Bisquieting reports of the unsettled state of affairs in the neighbourhood of the proposed line of frontier between Tonquin and the provinces of Yunnan and Kwangsi continue to reach the capital, and it is said that the late King of Annam, deposed by the French, is a jfugitive in the north-we^t of Tonquin, and that the three provinces bordering on Siam, Burmah, and Yunnan have adopted his cause. Under these cireumstences, it seems very doubtful whether the proposed Chinese Delimitation Commission that has or is about to start from Canton will be able to reach the Touquifi frontier without incurring grave risks of personal danger. I shaU not fail to watch the approaching negotiations with every care, with a view to repotting to your Lordship the Regulations that may be come to in virtue of Article Vl of the Ftaneo-Ohinese Treaty of I^aqe, and their probable effect on British commercial interests in the south-west provinces of China. I have, &c. (Signed) N. R. O'CONOR. No. 65. Mr. O' Conor to the Marqids of Salisbury. '^{Heceived January 26, 1886.) (Extract.) Peking, December 7, 1885. I HAVE the honour to inform your Lordship that M. Cogordan, Plenipotentiary of the French Government, left Peking this day for Tien-tsin, in order to negotiate the Franco-Chinese Commercial Treaty with the Viceroy Li Hung-chang. The draft of this Treaty was communicated a few days ago to the Tsuug-li Yamfin by M. Cogordan. The stipulations of the Commercial Treaty, as iar as they are likely to affect British trade, will continue to be the subject of my careful observation. No. 66. Viscount Lyons to the Marquis of Salisbury.-— (Received January 29.) My Lord, Paris, January 27, 1886. WITH reference to my despatdies of the 22nd July last and of the 24th of the same month, I have the honoar to inclose herewith to your Lordship, extracted from the '' Joiumal Officiel" of this lAafya Decree of the President of the Republic, ordering the full and entire execution of the Treaty of Peace, Friendship, and Commerce, concluded between France and China at Tien-tsin on the 9th June, 1886. The text of the Treaty is embodied in the Decree. I have, &c. (Signed) LYONS. Inclosurein No. 66. Extract from the "Journal Oficiel" of January 27, 1886. LE President de la Rdpublique Frangaise^ Sur la proposition du, President du Conseil, Ministre des Affaires Etrangferes, D^crete; Article 1". Le S^nat et la Chambre des Deputes ayant approuv^ le Traitd de Pak^ d'Amiti^, et de Commerce, conclu entre la France et la Chine h Tien-Tsin, le 9 Juin, 1885, et les ratifications de cet Acte ayant 6te ^changdes h P6kin le 28 Novembre, 1885, le dit Traitd, dont la teneur suit, recevra sa pleine et entiere execution :— Traite' de Paix, d'Amitie', et de Commerce, conclu entre la France et la Chine, le 9 Jwm, 1885, a Tien-Tsin. Le President de la Rdpublique Frangaise et Sa Majesty rEropereur de Chine, animus r«ta et I'autre d'un ^gal ddsir de mettre un terme aux difficult^s auxquelles a donne' lieu L177] H 5Q leur intervention siraultanee daus les affaires de I'Annam, et voulant retablir et amdjiorer le's anciennes relations d'amiti^ et de commerce qui ont existe entre^ la France et la Chine, ont resolu de conclure un nouveau Traits repondant aux int^rets coramuns des deux nations en prenant pour base la Convention Preliminaire signee ^ Tien-Tsin le 1 1 Mai, 1884, ratifide par Decret Imperial le 13 Avril, 1885. A cet effet, les deux Hautes Parties Contractantes ont nomme pour leurs Plenipo- tentiaries, savoir : Le President de la Rdpublique Frau^aise, M. Jules Paten6tre, Envoy6 Extraordinaire et Ministre Plenipotentiaire de France en Chine, Officier de la Legion d'Honneur, Grand- Croix de rfiioile Polaire de Su^de, &c. ; Et Sa Majestd I'Empereur de Chine, Li Hong-chang, Commissaire Imperial, Premier Grand Secretaire d'ifitat, Grand Precepteur Honoraire de I'Heritier PresonnDtif/ Surinten- dant du Commerce des Ports du Nord, Gouverneur-Gen^ral de la Province du Tcheli, appartenant au premier degr^ du troisi^me rang de la Noblesse, avec le litre de Souyi ; . Assist^s de Si-Tchen, Commissaire Imperial, Membre du Conseil des Affaires jfitrang^res, President au Ministfere de la Justice, Administrateur du Tresor au Ministere des Finances, Directeur des ]Scoles pour I'ifiducation des Officiers Hdr^ditaires de I'Aile Gauche de I'Arm^e Tartare h. Pdkin, commandant en chef le contingent Chinois de la Banni^re Jaune k bordure ; - Et de Teng-Tcheng-Sieou, Commissaire Imperial, Membre du Ceremonial d'Etat ; Lesquels, apr^s s'itre communique leurs pleins pouvoirs, qu'ils ont reconnus en bonne et due forme, sont convenus des Articles suivants :— ARTICLE I. La France s'erigage k retablir et k maintenir I'ordre dans les Provinces de I'Annam qui continent k I'Empire Chinois. A cet effet, elle prendra les mesures necessaires pour disperser ou expulser les bandes de pillards et gens sans aveu qui compromettent la tranquillity publique et pour emp6cher qu'elle ne se feforment. Toutefois les troupes Fran9aises ne pourront, dans aucun cas, franchir la fronti^re qui separe le Tonkin de la Chine, fronti^re que la Fra;nce promet de respecter et de garantir contre toute agression. De son c6te, la Chine s'engage ci disperser ou cl' expulser les bandes qui se refugieraient dans ses provinces liroitrophes du Tonkin, et k disperser celles qui chercheraient k se former sur son territoire pour aller porter le trouble parmi les populations placees sous la protection de la France, et, en consideration des garanties qui lui sont donnees quant k la s^curit^ de sa frontiere, elle s'interdit pareillement d'envoyer des troupes au Tonkin. Les Hautes Partes Contractantes fixeront, par une Convention speciale, les conditions dans lesquelles s'effectuera I'extradition des malfaiteurs entre la Chine et I'Annam. Les Chinois, colons ou anciens soldats, qui vivent paisiblement en Annam, en se livrant a I'agriculture, h, I'industrie, ou au commerce, et dont la conduite ne donnera lieu k aucun reproche, jouiront pour leurs personnes et pour leurs biens de la raSme sdcurit6 ' que les prot^g^s Fran9ais. ARTICLE II. La Chine, decidee a ne rien faire qui puisse compromettre I'oeuvre de pacification entreprise par la France, s'engage k respecter, dans le present et dans I'avenir, les Traites, Conventions, et Arrangements, directement intervenus ou k intervenir entre la France et I'Annam. En ce qui concerne les rapports entre la Chine et I'Annam, il est entendu qu'ils seront de nature a ne point porter atteinte k la dignity de I'Empire Chinois et k ne donner lieu k aucune violation du present Traits. ARTICLE III. Dans un d^lai de six mois k partir de la signature du present Traits, des Commissaires d^sign^s par les Hautes Parties Contractantes se rendront sur les lieux pour reconnaitre la frontiere entre la Chine et le Tonkin, lis poseront partout, oCl besoin sera, des homes destinees k rendre apparente la ligne de demarcation. Dans le cas ou ils ne pourraient se Jnettre d'accord sur I'emplacement de ces bornes ou sur les rectifications de detail qu'il pourrait y avoir lieu d'apporter k la frontiere actuelle du Tonkin, dans I'intdret commun des deux pays, ils en r^fdreraient k leurs Gbuvernementsrespectifs. ARTICLE IV. Lorsque la frontiere aura 4t6 reconnue, les Frangais, ou proteges Fran^ais, et les habitants Strangers du Tonkin, qui voudroht la franchir pour se rendre en Chine ne 51 pourront le faire qu'aprfes s'^tre munis prealablenient de passeports d^livrds par les autorit^s Chinoises de la fronti^re sur la demande des autorites Fran9aises. Pour les sujets Chinois, il suffira d'une autorisation d^livree par les autorites Imperiales de la fronti^re. Les sujets Chinois qui voudront se rendre de Cliine au Tonkin paf voie de terre, deyront ^tre munis de passeports r^guliers, d^livr^s par les autorites Fran9aises sur la demande des autorites Imperiales. ARTICLE V. Le commerce d'importation et d'exportation sera perniis aux ndgociants Fran^ais ou proteges Frangais et aux ndgociants Chinois par la frontifere de terre entre la Chine et le Tonkin. II devra se faire toutefois par certains points qui seront determines ulterieureraent, et dont le choix, ainsi que le nombre, seront en rapport avec la direction comme avec I'importance du trafic entre les deux pays. II sera tenu compte, h cet egard, des R^gle- ments en vigueur dans I'intdrieur de.rEmpire Chinois. En tout etat de cause, deux de ces points seront d^sign^s surla fronti^re Chinoise : I'un au-dessus de. Lao-Kai, I'autie au dela de Lang-Son. Les commer9ants Frangais pourront s'y fixer dans les m^mes conditions et avec les m^mes avantages que dans les ports ouverts du commerce etranger. Le Gouvernement de Sa Majeste I'Empereur de Chine y installera des Douanes et le Gouvernement de la Republique pourra y entretenir des Consuls dont les privileges et les attributions seront identiques h. ceux des Agents de mSme ordre dans les ports ouverts. De son c6t6, Sa Majeste I'Empereur de Chine pourra, d'accord avec le Gouvernement Fraq^ais, nommer des Consuls dans les principales villes du Tonkin. ARTICLE VL Un Reglement special, annex^ au present Traits, precisera les conditions dans lesquelles s'efFectuera le commerce par terre entre le Tonkin et les provinces Chinoises du Yun Nan, du Kouang-Si, et du Kouang-Tong. Ce Rdglement sera elabore par des Commissaires qui seront nommes par les Hautes Parties Contractantes, dans un d61ai de trois mois aprfes la signature du present Traitd, Les marchandises faisant I'objet de ce commerce seront soumises, k I'entree et a la sortie, entre le Tonkin et les Provinces du Yun Nan et du Kouang-Si, a des droits inferieurs h. ceux que stipule le Tarif actuel du. commerce Stranger. Toutefois, le Tarif reduit ne sera pas applique aux marchandises transportees par la frontiere terrestre entre le Tonkin et le Kouang-Tong et n'aura pas d'effet dans les ports d^ja ouverts par les Trait^s. Le commerce des armes, engins, approvisionnementSj et munitions de guerre de toute esp^ce sera soumis aux Lois et R^glemeuts ^dictes par chacun des Etats Contractants sur son territoire. L'exportation et I'importation de I'opium seront regies par des dispositions speciales qui figureront dans le Reglement Commercial susmentionn^. Le commerce de mer entre la Chine et I'Annam sera egalement I'objet d'un Regle- ment particulier. Provisoirement, il ne sera innove en rien k la pratique actuelle. ARTICLE VII. En vue de developper dans les conditions les plus avantageuses les relations de commerce et de bon voisinage que le present Traite a pour objet de r^tablir entre la France et la Chine, le Gouvernement de la Republique construira des routes au Tonkin et y encouragera la construction de chemins de fer. LorsquCj de son c6te, la Chine aura decide de construire des voies ferre'es, il est entendu qu'elle s'adressera k I'industrie Fran9aise, et le Gouvernement de la Republique lui donnera toutes les facilit^s pour se procurer en France le personnel dont elle aura besoin. II est entendu aussi que cette clause ne peut fetre considlrde comme constituant un privilege exclusif en faveur de la France. ARTICLE VIII. Les stipulations commerciales du present Traite et les Rfeglements a intervenir pourront etre revises apr^s un intervalle de dix ans revolus a partir du jour de I'echange des ratifications du present Traite. Mais, au cas ou, six mois avant le terme, ni I'une ni I'autre des Hautes Parties Contractantes n'aurait manifesto le desir de procdder a la revision, les stipulations commerciales resteraient en vigueur pour un nouveau terme de dix arts et ainsi de suite. [177] 53 ARTJCLE IX. Des que le prdsent Traite aura dte signe^ les forces Fran9aises recevront I'ordre de se retirer de Kelung et de cesser la visite, &c., en haute mer. Dans le ddlai d'yin rnois apr^a la signature du present Traite, I'lle de Formose et les Pescadores seront enti^rqipent eyacudes par les troupea Fran9aises. ARTICLE X. Les dispositions des anciens TraiteS;^ Accords, et Conventions entre la France et la Chine, non modifies par le present Traits, restent en pleine vigueur. I^ present Traits sera ratifie des k present par Sa Majesty I'Ernpereur de Chine, et,, apres qu'il aura ^te ratifie par le President de la R^publique Fran^aise, I'^ghangQ des ratifi" cations se fera a Pekin dans le plus bvef delai possible. Fait a Tien-Tsin en quatre exemplaires, le 9 Juin, 1885, correspondant au 27* jour de h 4° lune de la IP ann^e Kouang-Sien. ' (L.Si) (Signe) PATENOTRE. (L.S.) (Sign^) SI TCHEN. (L.S.) (Signe) LI HONG-CHANG. (L.S.) (Sign^ TENG TCHENG SIEOU. Art. 2. Le President du Conseil, Ministre des Affaires Btrang^res, est charge da I'execution du present Decret. Fait h Paris, le 25 Janvier, 1886. (Signd) JULES GRfiVY. Par le President de la R^publique : Le President du Conseil, Ministre des Affaires Btrang^res, (Signe) C. DE Frbycinet. (Translation.) THE President of the French Republic, on the mptjqn, of the President of the Council of Ministers, Minister for Foreign Affairs, Decrees : Article 1 . The Senate and the Chamber of Deputies having approved the Treaty of Peace, Friendship, and Commerce, concluded between France and China, at Tien-tsin, on the 9th June, 1885, and the ratifications of that Act having been exchanged at Peking on the 28th November, 1885, the said Treaty, of which the following is the substance, shall be carried out in its entirety.: Treaty of Peace, Friendship,- and Commerce, concluded between Frafice and China on the 9th June, 1885, at Tien-tsin. The President of the French Republic and His Majesty the Emperor of China, animated by an equal desire to put an end to the difficulties which have given rise to their simultaneous intervention in the affairs of Annam, and wishing to re-establish and improve the friendly and commercial relations whigh formerly existed between France and China, have resolved to conclude a new Treaty to further the common interests of both nations, and tq take for a basis the Preliminary Convention signed »t Tien'-tsin on the Uth Me^y, 1884, and ratified by an Imperial Decree of the 13tb April, 1885. For that purpose the two High Contracting Parties bavQ appointed as theii? Plenipo- tentiaries the following, that is to say: The President of the French Republic, M. Jules PQ,ten6tre, Envoy Extraordinary jin4 Minister Plenipotentiary of France in China, Qffigej? of the Legioft of Honour, Qxmi Cross of the Polar Star of Sweden, &c., &c.; And His Majesty the Emperor of China, Li Hong-chang, Imperial Comrhissioner, First Grand Secretary of State, Grand Honorary Pi-eceptor of the Heir Presumptive, Superintendent of the Commerce of the Northern Ports, Governor-General of the Province of Tcheli, belonging to the first degree of the third raok of the Nobility, with the title of Souyi; " : Assisted by Si Teh en, Imperial Commissioner, Member of the Council of Foreign Affairs, President at the Ministry of Justice, Administrator of the Treasury at the Ministry of Finance, Director of the ' Schools for the Education of the Hereditary Officers of tW 53 left wing of the Tartar Army at Peking, Commander-in-chief of the Chinese contingent of the Yellow Banner ; And by Teng Tcheng-SieoUj Imperial Corhhiissiorierj Member of the Ceremonial of State ; Who, after having communicated to each other their full powerSj which haVe been found to be in due and proper form, have agreed to the following Articles : — ARTICLE I. ^E'rance engages to re-establish and to maintain order in those provinces of Annam which are on the confines of the Chinese JEmpire. With this object she will take the necessary measures to disperse or expel the bands of plunderers and vagabonds who endanger the public safety, as well as to preveht such bands from being again bi'ought together. French troops shall in no case crosfe the frontier which separates Tonquin from China — a frontier which France engages to respect and to guarantee against all attack. On her part, China engages to disperse and expel the bands who may take refuge in the frontier provinces of Tonquin, and to disperse those who may attempt to come together on her territory with a view to create disturbances atnong the populations under the protection of France ; and in consideration of the guarantees which have been given to her with regard to the safety of the frontier, she likewise engages not to send troops to Tonquin. The High Contracting Parties shall fi^i by a special Conventionj the conditions under which the extradition of malefactors between China and Annam shall be carried out. The Chinese, whether colonists or old soldiers, who reside peaceably in Angara, devoting themselves to agriculture, to industry or commerce, and whose conduct shall give rise to no complaint, shall enjoy the same security for their persons and property as that of %he French "protdg^s." ARTICLE II. China, being resolved to do nothing Which tnight imp-eril the Work of p^dlficatlotl undertaken by France, engages to respect, both now and hereafter, all Treaties, Con- ventions, and Ari'angements ditectly concluded, or to be concluded, between FfctnCe atld Annam. As regards the relations between ChinEl and Annam, it is agreed that they shall be of such a kind as not to injure the dignity of the Chinese Empire^ and not to give rise to any violation of the present Treaty. ARTICLE III. Within six months from the signature of the pr6Sdnt Treaty, the Commissioners liamed by the High Contracting Parties shall proceed to the spot in order to define the frontier between China and Tonquin. They shall lay down boundaries wherever needful, with a view to render the line of demarcation clear. > In the event of their failing to come to an understanding as regards th^ settlement of such boundaries, or as regards the rectification in matters of detail which, in the joint interest of the two countries, there may be ground for introducing in the actual frontier of Tonquin, they shall refer the difficulty to their respective Governments. ARTICLE IV. When the frontier shall have been agreed upon, French, or French-protected (citizens) who may wish to cross it in order to proceed to China, shall not be allowed to do io unless they shall have previously provided themselves with passports issued by the Chinese frontier authorities on the application of the French authorities. In the case of Chinese subjects, an authorization delivered by the Imperial frontier authorities shall be sufficient. Chinese subjects wishing to proceed from China to 'fonquin by land shall be obliged to provide thetnselves with regular passports, issued by the French authorities on the application of the Imperial authorities. ARTICLE V. Import and export trade shall be permitted to Fretich or French-protected traders ^nd to Chinese traders across the land frontier betwec^a China and Tonquin. It shall, hQ*ever [1^7] 12' 54 be carried on through certain spots which shall be settled later, and both the selection and number of which shall correspond with the direction and. importance of the traffic between the two countries. In this respect the Regulations in force in the interior of the Chinese Empire shall be taken into account. In any case, two of the said spots shall be marked out on the Chinese frontier, the one above Lao-kai, the other beyond Lang-son. French traders shall be at liberty to settle there under the same conditions, and with the same advantages, as in the ports open to foreign trade. The Government of His Majesty the Emperor of China shall establish custom-houses there, and the Government of the Republic shall be at liberty to maintain Consuls there, whose powers and privileges shall be identic with those of Agents of the same rank in the open ports. On his part, His Majesty the Emperor of China shall be at liberty, with the concur- rence of the French Government, to appoint Consuls in the principal towns of Tonquin. ARTICLE VI. A special code of Regulations, annexed to the present Treaty shall define the condi- tions under which trade shall be carried on by land between Tonquin and the Chinese Provinces of Yiinnan, of Kouang-si, and of Kouang-tong. Such Regulations shall be drawn up by Commissioners, who shall be appointed by the High Contracting Parties, within three months from the signature of the present Treaty. All goods dealt with by such trade shall be subject, on import and export between Tonquin and the Provinces of Yunnan and Kouang-si, to duties lower than those laid down by the present Tariff for foreign trade. The reduced Tariff shall not, however, be applied to goods transported by way of the land frontier between Tonquin and Kouang- tong, and shall not be enforced within the ports already open by Treaty. Trade in arms, engines, supplies, and munitions of war of any kind whatsoever shall be subject to the Laws and Regulations issued by each of the Contracting States within its own territory. The export and import of opium shall be governed by special arrangements to be inserted in the above-mentioned code of Regulations. Trade by sea between China and Annam shall likewise be dealt with by a separate code of Regulations. In the meanwhile, the present practice shall remain unaltered. ARTICLE VII. "With a view to develop under the most advantageous conditions the relations of com- merce and of good neighbourship, which it is the object of the present Treaty to re-establish between France and China, the Government of the Republic shall construct roads in Tonquin, and shall encourage the construction of railways there. When China, on her part, shall have decided to construct railways, it is agreed that she shall have recourse to French industry, and the Government of the Republic shall afford every facility for procuring in France the staff that may be required. It is, more- over, understood that this clause shall not be looked upon as constituting an exclusive privilege in favour of France. ARTICLE VIII. The commercial stipulations of the present Treaty and the Regulations to be agreed upon shall be liable to revision after an interval of ten complete years from the date of the exchange of the ratifications of the present Treaty. But in case six months before it expires, neither one nor other of the High Contracting Parties shall have expressed a wish to proceed to a revision, the commercial stipulations shall remain in force for a fresh period of ten years, and so further in like manner. ARTICLE IX. As soon as the present Treaty shall have been signed, the French forces shall receive orders to retire from Kelung and to cease search, &c., on the high seas. Within one month from the signature of the present Treaty the Island of Formosa and the Pescadores shall be entirely evacuated by the French troops. ARTICLE X. All stipulations of former Treaties, Agreements, and Conventions between France and China, which are not modified by the present Treaty, remain in full force. The present Treaty shall be ratified at once by His Majesty the Emperor of Chinas 55 and after it shall have been ratified by the President of the French Republic, the exchange of ratifications shall take place at Peking with the least possible delay. Done in quadruplicate at Tien-tsin, this 9th June, 1885, corresponding to the 27th day of the 4th moon of the 11th year Kouang-sien. (L.S.) (Signed) PATENOTRE. (L.S.) (Signed) SI TCHEN. (L.S.) (Signed) LI HONG-CHANG. (L.S.) (Signed) TENG TCHENG SIEOU. Art. 2. The President of the Council, Minister for Foreign Affairs, is charged with the execution of the present Decree. Done at Paris, this 25th January, 1886. (Signed) JULES GRIEVY. By the President of the Republic : The President of the Council, Minister for Foreign Affairs, (Signed) C. de Freycinet. No. 67. The Earl of Rosebery to Mr, 0' Conor. (Telegraphic.) Foreign Office, February 24, 1 886. REPORT by telegraph as to any probable contracts or concessions ^to foreign Governments or subjects. No. 68. The Earl of Rosebery to Mr, 0' Conor. (Telegraphic.) Foreign Office, March 13, 1886. WITH reference to your despatch of the 7th December, can you telegraph any information as to the progress of the Franco-Chinese commercial negotiations ? No. 69. Mi\ 0' Conor to the Earl of Rosebery. — (Received March 16.) (Telegraphic.) Peking, March 16, 1886. IT seems highly improbable that the Chinese Government will bind themselves to any foreign Syndicates in a way at all likely to be detrimental to British interests. No. 70. Mr. 0' Conor to the Earl of Rosebery. — (Received March 16.) (No. 16.) (Telegraphic.) Peking, March 16, 1SS6. MY despatch of 7th December. The negotiations respecting the Franco-Chinese Commercial Treaty which have been conducted at Tien-tsin are said to be approaching conclusion. I believe that the principal clauses in the Treaty will probably be : — (1.) Frontier import duties one-fifth, export duties one-third less than Maritime Tariff'. (2.) Prohibition on both sides of the opium trade. (3.) French to have jurisdiction over Chinese subjects in Tonquin, and likewise over Tonquinese in China, though possibly this may apply only to ports where there are French Consuls. m (4.) Recip^eal extradition when proofs are furnished of the crime on Which the demand for extradition is fotlttded* The Treaty to be submitted to the Chinese Government for approval before the end of the month. ^- i - d It is likely that the Tonquin Frontier Delim'itatioti Commission will adjourn before long. The commercial frontier ports, which the Treaty of June 9 secures, cannot be fixed until the verification etuA subsequent rectification of the frontier has been settled. I am informed that effect has been given to Article VII of the Treaty of Peace, by allowing Prance to tender for the materials of a railway, which has just been sanctioned from the Kaiping coal mines to Peytang, a distance of some sixty miles> and that the scheme has been approved. -1 n H H ,»^.; '* 4= <6 Gq cb s ^ a s*.* 1 s- -^ r & *■ 5| g' 1 e s "^ .^ ^ .^ § 3 £; g 00 § « ,&> «« gb s g t. % a. g. g n S PON Ann hina ■ g d 3 w K - b^ I— 1 t2! t> efi " fei-s ectio egoti p » 013 the ions D* _^ 00 00 < n C3 ff B n B XT ^^ a (S n ?•■ tc ««. CHINA. No. 3 (1887). CONVENTION BETWEEN HER MAJESTY AND HIS MAJESTY THE EMPEROR OP CHINA RELATIVE TO BTJEMAH AND THIBET Signed at Pehing, July 24, 1886. Presented to bpth Houses of Parliament by Command of Her. Majesty. August 1887. LONDON: FEINTED FOR HER MAJESTY'S STATIONERY OFFICE BY HARRISON AND SONS, ST. MARTIN'S LANE, PBINTEJIS INcOBDINAKY TO HER MAJESTY. And tb be purchased, either directly or through any Bookseller, from EYRE AND SPOTTISWOODE, East Harding Street, Fieet Street, E.C., and 32, ABiNeDON Street, Westminster, S.W. ; or ADAM AND CHARLES BLACK, 0, North Bridoe, Edinburgh; or HODGES, FIGGIS, and Co., 104, Grafton Street, Dublin. [0.— 5164.] Price Id. Convention between Her Majesty and His Majesty the Emperor of China relative to Burmah and Thibet. Signed at Peking, July 24, 1886. [^Ratifications exchanged in London, August 25, 1887.] WHEREAS Her Majesty the Queen of Great Britain and Ireland, Empress of India, and His Majesty the Emperor of China, being sincerely desirous to maintain and perpetuate the relations of friendship and good understanding which now exist between their respectiye Empires, and to promote and extend the commercial inter- course between their subjects and dominions, the following Oonrention has been agreed upon and concluded :— On the part of Great Britain by Nicholas Roderick O'Conor, Esquire, Her Majesty's Secretary of Legation at Washington, and lately Her Majesty's Charg^ d' Affaires in China, Companion of the Most Distinguished Order of St. Michael and St. George, duly empowered thereunto ; And on the part of China by his Highness Prince Ch'ing, President of the Tsung-li Yamen, and his Excellency Sun, Minister of the Tsung-li Tamen, Senior Vice-President of the Board of Works. ARTICLE I. Inasmuch as it has been the practice of Burmah to send decennial Missions to present articles of local produce, England agrees that the highest authority in Burmah shall send the customary decennial Missions, the members of the Missions to be of Burmese race. ARTICLE 11. China agrees that, in all matters whatsoever appertaining to the authority and rule which England is now exercising in Burmah, England shall be free to do whatever she deems fit and proper. ARTICLE III. The frontier between Burmah and China to be marked by a Delimitation Commission, and the conditions of frontier trade to be settled by a Erontier Trade Convention, both countries agreeing to protect and encourage trade between China and Burmah. ARTICLE IV. Inasmuch as inquiry into the circumstances by the Chinese Government has shown the existence of many obstacles to the Mission to Thibet provided for in the Separate Article of the Chefoo Agreement, England consents to countermand the Mission forthwith. With regard to the desire of the British Government to consider arrangements for frontier trade between India and Thibet, it will be the duty of the Chinese Govern- ment, after careful inquiry into the circumstances, to adopt measures to exhort and encourage the people with a view to the promotion and development of trade. Should it be practicable, the Chinese Government shall then proceed carefully to consider Trade Regulations ; but, if insuperable obstacles should be found to exist, the British Government will not press the matter unduly. feiii ARTICLE V. The present Convention shall be ratified, and the ratifications shall be exchanged in London as soon as possible after the date of the signature thereof. In witness whereof the respective negotiators have signed the same and affixed thereunto the seals of their arms. Done in triplicate at Peking this twenty-fourth day of July, in the year of our Lord one thousand eight hundred and eighty-six, corresponding with the Chinese date the twenty-third day of the sixth moon of the twelfth year of Kuang Hsli. (L.S.) NICHOLAS EODERICK O'CONOK (L.S.) (Monogram) CH'ING. ' (Monogram) SUN YtJ-WEN. t a :j3 s § 1 ^ Ef. '^ O »< ^ 1 ■s 1 ^ Cft ^ Ob '^ ^ k ^ ^ Qt; g (3 «« 1 1 , g 00 B* 00 0*i ^ ^« 9 3 n a S 5 g- " s i f o s '■? 3 '^• a •«) S § ^ '^ ty 7 M !25 p CO 00 00 CHINA. No. 1 (1913). /O DESPATCHES FROM HIS MAJESTY'S AMBASSADOR AT ST. PETERSBURGH TRANSMITTING THE RTJSSO-MONGOLIAN ; AGREEMENT AND PROTOCOL OF THE 21sT OCTOBER (Seb NOVEMBER), 1912. Presented to hoth Houses of Parliament hy Command of His Majesty. February 1913. LONDON: PUBLISHED BY HIS MAJESTY'S STATIONEEY OFFICE. To befpurchased, either directly or through any Bookseller, from WYMAN AND SONS, Ltd., Fetter Lane, E.C., and 32, Abingdon Street, S.W., and 54, St. Mary Street, Cardiff ; or H.M. STATIONERY OFFICE (Scottish Branch), 23, Forth Street, Edinburgh; or E. PONSONBY, Ltd., 116, Grafton Street, Dublin; or from the Agencies in the British Colonies and Dependencies, the United States of America, the Continent of Europe and Abroad of T. FISHEE UNWIN, London, W.C. printed by HAERISON AND SONS, 45-47, St. Martin's Lane, W.C, Printers in Ordinary to His Majestvt. [Cd. 6604.1 Price lid. TABLE OF CONTENTS. No. Name. Date. Subject. Page 1 2 Sir G. Buchanam . . w » • • • • Nov. 8, 1912 Dec. 1, Transmits copy of the Russo-Mongolian Agree- ment of 21st October (3rd November), 1912 .. Transmits translation of the protocol annexed to the Russo-Mongolian Agreement 1 3 Despatches from His Majesty's Ambassador at St. Peters- burgh transmitting the Russo-Mongohan Agreement and Protocol of the 21st October (3rd November), 1912. No. 1. Sir G. Buchanan to Sir Edward Grey. — (Received November 11.) Sir, St. Peter shurgh, November 8, 1912. I HAVE the honour to transmit herewith copy of the recently signed Russo- Mongolian Agreement, which has been communicated to His Majesty's Embassy by the Imperial Ministry for Foreign Affairs. I have, &e. GEORGE W. BUCHANAN. Enclosure in No. 1. Accord. PAR suite du d^sir unanimement proclamd par les Mongols de maintenir la constitution nationale et historique de leur pays, les troupes et les autorit^s chinoises furent obligees d'evacuer le territoire mongol, et Djebzoun Damba-Khutukhta fut proclamd Souverain du peuple mongol. Les anciens rapports entre la Mongolie et la Chine prirent ainsi fin. A I'heure actuelle, prenant en consideration les faits ci-dessus exposes ainsi que I'amitie reciproque qui a toujours existe entre les peuples russe et mongol, et vu la necessity de d^finir exactement le regime auquel est soumis le commerce mutuel russo- mongol ; Le Conseiller d'Stat actuel Jean Korostovetz, dliment autoris^ k cet eflfet par le Gouvernement Imperial de Rupsie ; et Le protecteur des dix mille doctrines Sain-noin Khan Namnan-Souroun, President du Conseil des Ministres mongol ; Le pl^nipotentiaire Tchin-souzouktou Tzin-van Lama Tzerin-Tchimet, Ministre de rintdrieur ; Le pldnipotentlaire Daitzln-van Handa-dorji, ayant le grade de Khan-erdeni, Ministre des Afiaires Etrangferes ; Le pldnipotentiaire Erdeni Dalai Tzun-van Gombo-Souroun, Ministre de la Guerre ; Le pl^nipotentiaire Touchetou Tzun-van Tchakdorjab, Ministre des Finances ; et Le pl^nipotentiaire Erdeni Tzun-van Namsarai, Ministre de la Justice ; DAment autoris^s par le Souverain du peuple mongol, par le Gouvernement mongol, et par les Princes gouvernants, se sont entendus sur ce qui suit : — Article 1". Le Gouvernement Imperial de Russie prdtera son concours a la Mongolie pour conserver le regime autonome qu'elle a ^tabli, ainsi que le droit d'avoir son arm^e nationale et de n'admettre sur son territoire ni la presence des troupes chinoises ni la. colonisation de ses terres par les chinois. Article 2. Le Souverain de Mongolie et le Gouvernement mongol accorderont, comme par le ,pass^ aux sujets et au commerce russes la jouissance dans leurs possessions des droits- et des privileges qui sont ^numdrds dans le protocole ci-annex^. [275] B 2 II est bien entendu qu'il ne sera pas accordd h, d'autres sujets strangers en Mongolie plus de droits que ceux dont y jouiront les sujets russes. Article 3. Si le Gouvernement mougol trouvait n^cessaire de conclure un traits separe avec la Chine ou une autre Puissance ^trangfere, ce nouveau traits ne devra en aucun cas ni porter atteinte aux clauses du present accord et du protocole y annex^ ni les modifier sans le consentement du Gouvernement Imperial de Russie. Article 4. Le present accord amical entrera eu vigueur k partir du jour de sa signature. En foi de quoi les pldnlpotentiaires respectifs, ayant compart les deux textes, russe et mongol, du present accord, fait en deux exemplaires, et ayant trouv^ ces deux textes conformes, les ont sign^s y ont apposd leurs sceaux et ont ^chang^ ces textes. •Fait h, Ourga, le 21 octobre, 1912, correspondant au 24^ jour du dernier mois d'automne de la 2^ annde du rhgne de rUnanimenient Proclamd du calendrier mongol. (Translation.) Agreement. IN accordance witb the desire unanimously expressed by the Mongolians to maintain the national and historic constitution of their country, the Chinese troops and -authorities were obliged to evacuate Mongolian territory, and Djebzoun Damba- Khutukhta was proclaimed Euler of the Mongolian people. The old relations between Mongolia and China thus came to an end. At the present moment, taking into consideration the facts stated above, as weU as themutual friendship which has always existed between the Russian and Mongolian nations, and in view of the necessity of defining exactly the system regulating trade between Russia and Mongolia ; The actual State Councillor Jean Korostovetz, duly authorised for the purpose by the Imperial Russian Government ; and The protector of the ten thousand doctrines Sain-noin Khan Namnan-Souroun, President of the Council of Ministers of Mongolia ; The plenipotentiary Tchin-souzouktou Tzin-van Lama Tzerin-Tchimet, Minister ■of the Interior ; The plenipotentiary Daitzin-van Handa-dorji, of the rank of Khan-erdeni, Minister for Foreign Affairs ; The plenipotentiary Erdeni Dalai Tzun-van Gombo-Souroun, Minister of War ; The plenipotentiary Touchetou Tzun-van Tchakdorjab, Minister of Finance ; and The plenipotentiary Erdeni Tzun-van Namsarai, Minister of Justice ; Duly authorised by the Ruler of the Mongolian nation, by the Mongolian Gbvern- anent and by the ruling Princes, have agreed as follows : — Article 1. ^ _ The Imperial Russian Government shall assist Mongolia to maintain the autonomous regime which she has established, as also the right to have her national army and to admit neither the presence of Chinese troops on her territory nor the colonisation of her land by the Chinese. Article 2. The Ruler of Mongolia and the Mongolian Governmait shall grant as in the past, to Russian subjects and trade the enjoyment in their possessions of the riffht^ and privileges enumerated in the protocol annexed hereto. ' .. It is well understood that there shall not be granted to other foreign subiects in Mongolia rjghts not enjoyed there by Russian subjects. & j lix Article 3. If tlie Mongolian Government finds it necessary to conclude a separate treaty ■with China or another foreign Power, the new treaty shall in no case either infringe the clanses of the present agreement and of the protocol annexed thereto, or modify them without the consent of the Imperial Russian Government. Article 4. The present amicable agreement shall come into force from the date of its signature. In witness whereof the respective plenipotentiaries, having compared the two texts, Russian and Mongolian, of the present agreement, made in duplicate, and having found the two texts to correspond, have signed them, have affixed thereto their seals, and have exchanged texts. Done at Urga on the 21st October, 1912, corresponding to the 24th day of the last autumn month of the 2nd year of the reign of the Unanimously Proclaimed, according to the Mongolian calendar. No. 2. Sir G. Buchanan to Sir Edward Orey. — {Received December 4.) Sir, St. Petershurgh, December 1, 1912. WITH reference to my despatch of the 8th ultimo, I have the honour to transmit to you herewith translation of the protocol annexed to the Russo-Mongolian agreement of the 21st October (3rd November) last. I have, &c. GEORGE W. BUCHANAN. Enclosure in No. 2. Protocol annexed to Russo-Mongolian Agreement of the 21st October (3rd November), 1912. BY virtue of the enactment of the second article of the agreement, signed on this date between Actual State Councillor, Ivan Korostovets, Plenipotentiary of the Imperial Ptussian Government, and the President of the Council of Ministers of Mongolia, Sain-noin Khan Namnan-Souroun, the Protector of ten thousand doctrines ; the Plenipotentiary and Minister of the Interior, Tchin-souzouktou Tzin-van Lama Tzerin-Tchimet ; the Plenipotentiary and Minister for Foreign Affairs, Daitzin-van Handa-dorji of the rank of Khan-erdeni ; the Plenipotentiary and Minister of War, Erdeni Dalai Tzun-van Gombo-Souroun ; the Plenipotentiary and Minister of Finance, Touchetou Tzun-van Tchakdorjab ; and the Plenipotentiary and Minister of Justice, Erdeni Tzun-van Namsarai, on the authority of the Ruler of Mongolia, the Mongolian Government, and the Ruling Princes ; the above-named Plenipotentiaries have come to an agreement respecting the following articles, in which are set forth the rights and privileges of Russian subjects in Mongolia, some of which they already enjoy, and the rights and privileges of Mongolian subjects in Russia : — Aeticle ]. Russian subjects, as formerly, shall enjoy the right to reside and move freely from one place to another throughout Mongolia ; to engage there in every kind of commercial, industrial, and other business ; and to enter into agreements of various kinds, whether with individuals, or firms, or institutions, official or private, Russian, Mongolian, Chinese, or foreign. [275] B 3 4 Article 2. Russian subjects, as formerly, sliall enjoy tlie right at all times to import and export, without payment of import and export dues, every kind of product of the soil and industry of Russia, Mongolia and China, and other countries, and to trade freely in it without payment of any duties, taxes, or other dues. The enactments of this (2nd) article shall not extend to combined Russo-Chinese undertakings, or to Russian subjects falsely declaring themselves to be owners of wares not their property. Article 3. Russian credit institutions shall have the right to open branches in Mongolia, and to transact all kinds of financial and other business, whether with individuals, institutions, or companies. Article 4. Russian subjects may conclude purchases and sales in cash or by an exchange of wares (barter), and they may conclude agreements on credit. Neither "khoshuns" nor the Mongolian Treasury shall be held responsible for the debts of private individuals. Article 5. The Mongolian authorities shall not preclude Mongolians or Chinese from completing any kind of commercial agreement with Russian subjects, from entering into their personal service, or into commercial and industrial undertakings formed by them. No rights of monopoly as regards commerce or industry shall be granted to any official or private companies, institutions, or individuals in Mongolia. It is, of course, understood that companies and individuals who have already received such monopolies from the Mongolian Government previous to the conclusion of this agreement shall retain their rights and privileges until the expiry of the period fixed. Article 6. Russian subjects shall be everywhere granted the right, whether in towns or *' khoshuns," to hold allotments on lease, or to acquire them as their own property for the purpose of organising commercial industrial establishments, and also for the purpose of constructing houses, shops, and stores. In addition, Russian subjects shall have the right to lease vacant lands for cultivation. It is, of course, understood that these allotments shall be obtained and leased for the above-specified purposes, and not for speculative aims. These allotments shall be assigned by agreement with the Mongolian Government in accordance with existing laws of Mongolia, everywhere excepting in sacred places and pasture lands. Article 7. Russian subjects shall be empowered to enter into agreements with the Mongolian Government respecting the working of minerals and timber, fisheries, &c. Article 8. The Russian Government shall have the right, in agreement with the Government ■of Mongolia, to appoint consuls in those parts of Mongolia it shall deem necessary. Similarly, the Mongolian Government shall be empowered to have Government .agents at those frontier parts of the Empire where, by mutual agreement, it shall be found necessary. Article 9. At points where there are Russian consulates, as also in other localities of importance for Russian trade, there shall be allotted, by mutual agreement between Russian consuls and the Mongolian Government, special " factories " for various branches of industry and the residence of Russian subjects. These " factories " shall be tinder the exclusive control i of the above-mentioned consiils, or of the heads of Hussian ■commercial companies if there be no Russian consul. Article 10. Russian subjects,in agreement with the Mongolian Government, shall retain the right to institute, at their own cost, a postal service for the dispatch of letters and the transit of wares between various localities in Mongolia and also between specified localities and points on the Russian frontier. In the event of the construction of " stages " and other necessary buildings, the regulations set forth in article 6 of this protocol must be duly observed. Article 11. Russian consuls in Mongolia, in case of need, shall avail themselves of Mongolian Government postal establishments and messengers for the dispatch of official corre- spondence, and for other official requirements, provided that the gratuitous requisition for this purpose shall not exceed one hundred horses and thirty camels per month. On every occasion, a courier's passport must be obtained from the Government of Mongolia. When travelling, Russian consuls, and Russian officials in general, shall avail themselves of the same establishments upon payment. The right to avail themselves of Mongohan Government " stages ", shall be extended to private individuals, who are Russian subjects, upon payment for the use of such " stages " of amounts which shall be determined in agreement with the Mongolian Government. Article 12. Russian siibjects shall be granted the right to sail their own merchant-vessels on, and to trade with the inhabitants along the banks of, those rivers and their tributaries which, running first through Mongolia, subsequently enter Russian territory. The Russian Government shall afford the Government of Mongolia assistance in the improvement of navigation on these rivers, the establishment of the necessary beacons, . &c. The Mongolian Government authorities shall assign on these rivers places for the berthing of vessels, for the construction of wharves and warehouses, for the preparation of fuel, &c., being guided on these occasions by the enactments of article 6 of the present protocol. Article 13.. Russian subjects shall have the right to avail themselves of all land and water routes for the carriage of wares and the droving of cattle, and, upon agreement with the Mongolian authorities, they may construct, at their own cost, bridges, ferries, &c., with the right to exact a special due from persons crossing over. Article 14. Travelling cattle, the property of Russian stibjects, may stop for the purpose of resting and feeding. In the event of prolonged halts being necessary, the local authorities shall assign proper pasturage areas along travelling cattle routes, and at cattle markets. Fees shall be exacted for the use of these pasturing areas for periods exceeding three months. Article 15. The established usage of the Russian frontier population harvesting (hay), as also hunting and fishing, across the Mongolian border shall remain in force in the future without any alteration. Article 16. Agreements between Russian subjects and institutions on the one side and Mongolians and Chinese on the other may be concluded verbally or in. writing, and the contracting parties may present the agreement concluded to the local Government authorities for ■certification. Should the latter see any objection to certifying the contract, they must immediately notify the fact to a Russian consul, and the misunderstanding which has arisen shall be settled in agreement with him. It is hereby laid down tliat contracts respecting real estate must be in written form, and presented for certification and confirmation to tlie_ proper Mongolian. Government anthorities and a Russian consul. Documents bestowing rights to exploit natural resources require the confirmation of the Government of Mongolia. In the event of disputes arising over agreements concluded verbally or in vrriting, the parties may settle the matter amicably with the assistance of arbitrators selected by each party. Should no settlement be reached by this method, the matter shall be decided by a mixed legal conunission. There shall be both permanent and temporary mixed legal commissions. Permanent commissions shall be instituted at the places of residence. of Russian consuls, and shall consist of the consul, or his representative, and a delegate of the Mongolian authorities of corresponding rank. Temporary commissions shall be instituted at places other ' than those already specified, as cases arise, and shall consist of representatives of a Russian consul and the prince of that " khoshun " to which the defendant belongs or in which he resides. Mixed commissions shall be empowered to call in as experts persons with a knowledge of the case from among Russian subjects, Mongolians, and Chinese. The decisions of mixed legal commissions shall be put into execution without delay, in the case of Russian subjects through a Russian consul, and in the case of Mongolians and Chinese through the prince of the " khoshun " to which the defendant belongs or in which he is resident. Article 17. The present protocol shall come into force from the date of its signature. In witness whereof, the respective plenipotentaries, finding, upon comparison of the two parallel texts of the present protocol — Russian and Mongol — drawn up in duplicate, that the texts correspond, have signed each of them, affixed their seals, and exchanged texts. Executed at Urga, the 21st October, 1912 (o.s.), and by the Mongolian calendar, on the twenty-fourth day of the last autumn moon, in the second year of the administration of the " Unanim.ously Proclaimed." In the original follow the signature of M. Korostovets, Minister Plenipotentiary ; and in the Mongol language the signatures of the President of the Mongolian Council of Ministers, and the Plenipotentiaries, the Ministers of the Interior, Foreign Affairs, War, Finance, and of Justice. o HI W D O O !z! to o •^ O & Co" & «. « Co c§ ■^ s >?. o^ 1 ^ i ^ )-* s to 09 ^ c: ' a tef OCR? CC ^ o S+ > 1 1 CO oo 0? °L Cj •-* tr ff" & CD 3 55 B 0«3 3 O S P" ^ s E? H B 1 a. P GQ h-i :? a e-^. S «> o p r}- h- * rt- or; '^ to o 0!" o Et o_ CD J- a g^ r CO rt- CQ tr- Q P CD 1 P4 ISS g O 1 o as c s= a. to- I 1^- M