File No. 5315/895.
American Embassy,
London, April 5,
1910.
No. 1233.]
[Inclosure.]
Ambassador Reid
to the Minister for Foreign
Affairs.
American Embassy,
London, April 2,
1910.
Sir: My Government has been awaiting with
great interest the result of the agreement between the British and
French financial groups on the division of interests in the
Hankow-Canton and Hankow-Szechuen Railways, of which you were good
enough to advise me in our conversation of March 15. So far we can
only learn that the agreement has not received the prompt sanction
of the French Government which was then expected, for the apparent
reason that it is thought to violate the equality between the groups
representing the four nations for which you and they as well as we
have been seeking.
While this unexpected delay is thus prolonged, and the negotiations
regarding this equal division, which have now been in progress for
10 months, since June 3, 1909, still bring forth nothing, I venture,
with the authority of my Government, to ask attention to what may be
the cause of their sterility. Is it not possible that it results
from a fundamental difference in what is really meant by the
equality at which we all say we are aiming? Does not Great Britain
mean equality in engineering rights on the Hankow-Canton line
exclusively for herself? And do not the other powers regard the
Hankow-Canton line as an integral part of the Hukuang loan
arrangement, and therefore to be considered in the equal division of
engineering rights?
Now, the original right of the united States was incontestably to
one-half interest in the whole Hankow-Szechuen line, including
extensions. On the suggestion of other parties interested we
accepted as a virtual equivalent a quarter interest in the combined
lines covered by the Hukuang agreement, the Canton-Hankow line and
the Hupeh section of the Hankow-Szechuen line. Because we were late
in the field, we waived our rights as to chief engineers, but
reserved them on further extensions. We thus became entitled to 800
kilometers, whether you consider our original half of the Szechuen
lines or our fourth in the combined lines. To facilitate agreement,
we accepted sub engineering rights on 200 kilometers from Germany,
and made a further concession of 100 kilometers to France, leaving
ourselves chief engineering rights on only 500 kilometers;
Now, as my Government understands the effect of the British proposal,
it would leave us still less, only 400 kilometers with chief
engineering rights, against 1,500 for Great Britain. We quite fail
to see why the Canton-Hankow line should be an integral part of the
Hukuang agreement for the loan and materials but not for engineering
rights. We gladly assent to the principle of equal division, but we
can not consider that division equal.
I have, etc.,
