No. 162.
Mr. Denby
to Mr. Bayard.
Peking, March 25, 1887. (Received May 7.)
Sir: I have the honor to report that my information is that Li Hung Chang yesterday obtained the assent of the Emperor to the building of a railroad between Tacu and Tientsin.
To whom the contract will fall is not decided. It is understood that the viceroy favors the plan submitted to him last year by General Wilson and Mr. Smith, of Russell & Co. Their proposition, which is now before the viceroy, is that a Chinese company is to be formed for Tacu line, the company to have the right to build future extensions (to Fung Chow or Peking and the line south); Russell & Co. to be foreign managers; General Wilson, chief engineer; loan to be made for the company of the Tacu line at 5½ per cent, interest, holding road as security. The loan is to be repaid as fast as Chinese shares are sold. The road is to be built and stocked at actual cost.
The viceroy will decide who shall have the contract as soon as he returns from the trip with the Emperor to the western mausolea—about the middle of next month. The French are making great efforts to secure the contract.
The new Kaiping railway, under the ex-customs taotai, Chow, with a canton lawyer named Achoy, are also bidding for the contract. Propositions have been made to consolidate this interest with the American company, but no result has been reached.
I have, etc.,