Our position upon this question has heretofore been so fully explained to
the Chinese Government and to the powers that I have deemed it
unnecessary for me to take any action either for or against this
Your Imperial Highness: The Chinese
Government has always recognized the obligation which it contracted
by the terms of the final protocol of the 7th of September, 1901, to
pay the indemnity in gold or in a quantity of silver equivalent to
the total in gold.
Nevertheless, because of the poverty of the treasury and the rise in
gold, it has begged the representatives of the powers to seek some
means to make it easier for China to fulfill her engagements.
Referring to this desire, the undersigned, by order of their
respective Governments, [Page 179]
have the honor to submit the following proposition in the nature of
On the one hand, the Chinese Government shall sign immediately the
national bonds, payable in gold, in accordance with the protocol of
the 7th of September, 1901. On the other hand, the undersigned
powers agree that the payment of the arrears of the indemnity shall
continue to be made as heretofore; that is to say, in silver at the
current rate of the day of each partial payment, and the said powers
grant to China the delay necessary to extinguish by this means the
total of the indemnity which is due to them.
As the true value of the monthly payments made by China depends on
the rate of silver, it is agreed that every time that the difference
between the sums paid and the sums due the undersigned powers shall
be in favor of the latter, this difference will remain due to the
said powers, and shall bear the same interest as the principal of
the indemnity. On the other hand, whenever this difference shall be
in favor of the Chinese Government the surplus sums paid shall be
immediately deducted from the total of the sums remaining due by
China to the undersigned powers.
As the Chinese Government is required to make monthly payments, the
representatives of the undersigned powers shall give instructions to
their delegates on the bankers’ commission of Shanghai, so that the
latter may fix the rates of exchange for each payment instead of
waiting for the end of each period of six months.
If the total of the payments made by China up to the expiration of
the year 1940 does not reach the sum necessary to equal in gold the
total of the indemnity due to each one of the undersigned powers,
the Chinese Government will continue to make monthly payments until
the complete settlement of the indemnity, capital and interest
In this case the bankers’ commission in Shanghai shall draw up a new
amortization table for the payments to be made after 1940, unless
the Chinese Government prefers to use the privilege which is granted
to it of settling immediately.
The undersigned do not doubt that the Chinese Government, recognizing
that this proposition has been inspired solely by the desire to
permit it to discharge its obligations more easily, will immediately
give to its delegates the order to sign the national bonds in the
form which has been drawn up by the commission of bankers.
It will not be possible to go any further in the way of making
concessions, and to recommend other plans for the examination of
their governments. The undersigned seize this occasion to renew,