Mr. Conger to Mr. Hay.

No. 1639.]

Sir: Referring to my No. 1630 of the 8th instant, I have the honor to inclose copies of a note received from the Waiwu Pu and of my reply thereto.

All the representatives of the signatory powers have received identical notes. The German and British ministers have made replies much the same as mine.

The proposals are the same as those irregularly presented by the Nanking viceroy to the consuls at Shanghai.

Trusting that my action will meet with your approval, and waiting your instructions,

I have, etc.,

E. H. Conger.
[Inclosure 1.]

Prince Ch’ing to Mr. Conger.

It is stated in the eleventh article of the peace protocol of 1901 that a board shall be established to have charge of the various matters connected with the maintenance and improvement of the Whangpu River bed, that the commercial interests of Shanghai may be protected. According to the estimate an expenditure of 460,000 Haikwan taels each year for twenty years will be necessary; of this amount one-half shall be supplied by the Chinese Government and one-half by the foreign nations interested.

This board finds that this excavation of the bed of the Whangpu River will not only open up a free course for the river but will be a great benefit to commerce as well. For this reason the Chinese Government now desires to do this excavating herself and assume the whole expense without the subscriptions of the commercial men of other nations. The whole manner in which we propose to handle the matter is set forth in the following five regulations:

The Chinese Government shall itself be responsible for all the expenses. Each year there shall be appropriated from the customs receipts 460,000 Haikwan taels to cover the expense of dredging the Whangpu, and this appropriation shall continue until the work is completed. The duties payable according to the thirtieth section of the seventeenth annex to the protocol shall all be remitted, and there shall be no duties levied on this account.
All public work on the Whangpu River will be under the direction of the taot’ai of Shanghai and the customs taot’ai. All marine, quarantine, and other matters of that nature will continue to be conducted according to the old regulations.
The plan now proposed is that, if all the ministers residing in Peking are agreeable, the Chinese Government will, after three months, select and appoint one or two engineers thoroughly acquainted with such work, to take charge of the whole affair. But those who wish to undertake any part of the work must first hand in an estimate of the cost, and selection will then be made from all the applicants.
A quarterly account of all receipts and expenditures should be kept, and a clear account sent to the various foreign consuls in Shanghai for their inspection.
The Chinese Government will itself supply all the funds necessary for the excavation, and hereafter it will not be permissible at any time to quote as a precedent the seventeenth annex of the protocol, nor will it be permissible to levy duties of this kind upon merchants of any nation owning land near the mouth of the river or having goods shipped thereon.

The foregoing five regulations are most advantageous both to China and to the other nations, and it becomes our duty to transmit them in a dispatch to your excellency for your inspection. We trust, too, that they will be sent to the Department of State for their deliberation. A reply to this dispatch is requested.

A necessary dispatch.

[Page 190]
[Inclosure 2.]

Mr. Conger to Prince Ch’ing.

Your Imperial Highness: I have the honor to acknowlege the receipt of your imperial highness’s note of the 9th instant, inclosing a proposition for the conservancy of the Whangpu River, which the Chinese Government desires to substitute for the arrangement agreed to by China and the powers in the final protocol of September 7, 1901, and contained in annex 17 thereto.

For three years the Chinese Government has been repeatedly urged by the representatives of the signatory powers to appoint the Chinese member which it has the privilege of appointing under Article IV (h) of annex 17, in order that the work arranged for by the protocol might be begun, and several times I have been personally assured by your highness and other members of the Wai Wu Pu that the said appointment would be speedily made.

Of course, your imperial highness is well aware that a change in the protocol or the adoption of any new plan must be unanimously accepted by all the signatory powers. In their present form I fear the proposals of the Chinese Government will not meet with unanimous approval, and the presentation of them must necessarily cause great delay.

The Chinese Government can hardly expect that the powers will consent to the appropriation for this purpose of any portion of the customs revenue which is already wholly pledged to the payment of foreign loans and indemnities, or agree to its diversion to any other purpose than that stipulated in Article VI of the protocol. Besides, the proposals now made, in my judgment, do not offer the same guaranties for the faithful execution of the necessary works as those which were agreed to by China and the powers in 1901.

Propositions similar to these were some time since made to me verbally by one of the ministers of your board, and I replied that until the Chinese Government evidenced its intention to carry out the provisions of Article IV (h) of annex 17, by appointing its member of the conservancy board, I could not entertain any proposition whatever for a change in the plan already agreed upon.

But, since the proposals have come to me in a formal manner, I will, as your highness requests, transmit them at once to my Government. Under present circumstances, however, I am unable to recommend their adoption.

I improve the occasion, etc.,

E. H. Conger.