File No. 893.51/918.
The American Minister
to the Secretary of State.
No. 538.]
American Legation,
Peking,
May 7, 1912.
Sir: With reference to my despatch No.
520,1 of April
18, 1912, regarding the controversy between the Chinese Provisional
Government and the banking groups over the loan negotiations, I have
the honor to inclose herewith copies of further correspondence
exchanged between the Chinese authorities and the ministers
concerned.
I have [etc.]
[Inclosure 1.—Memorandum.]
The Ministers of the four
Powers to the Foreign
Office.
The ministers for Great Britain, France, the United States, and
Germany have received the memorandum of the 15th instant1 in which the
Ministry for Foreign Affairs communicate the reply of the
Premier to the memorandum handed by the ministers to the
President of the Republic on the 25th ultimo,2 embodying
their protest against the loan contract signed with a Belgian
syndicate in violation of the written pledges given by the
Chinese Government on March 9 last to the group of banks of the
four nations.
The ministers note with regret that this memorandum makes no
allusion to the circumstances which gave rise to the protest in
question and is confined to the statement that regrettable
misunderstandings occurred in the negotiations with the
groups.
No misunderstandings occurred; what occurred was on the contrary,
a signal failure on the part of the Chinese Government to meet
its engagements.
The Premier adds that China is in absolute need of the groups’
financial assistance, and that if she fails to obtain it there
is every risk of an outbreak of disorder.
The ministers can only remind the Wai Chiao Pu of the great
readiness displayed by the group of banks to inaugurate advances
to China as soon as the new Government was formed, and of their
willingness, even during the recent disturbances in Peking and
North China, to continue to advance her monthly considerable
sums sufficient, in fact, to enable her to take all necessary
steps to prevent the recurrence of these outbreaks.
Under the circumstances the ministers do not feel justified in
advising the representatives of the group banks to resume
negotiations with the representatives of the Chinese Government
until effective steps have been taken by that Government to
secure respect for the pledges given to the groups.
Still less are the ministers disposed to give their consent to
the resumption of negotiations in view of the fact that,
subsequent to their protest, the Chinese Government has thought
fit by signing a fresh contract with the Belgian syndicate, to
act once again in contravention of the pledges given to the
groups on March 9.
[Page 126]
[Inclosure 2.]
The Premier, the Acting
Minister for Foreign Affairs, and the Acting Minister
for Finance to the Ministers of
the four Powers.
Sir: Whereas the loan contract between
the former Minister for Finance and the Belgian syndicate,
entered into on the 18th of February of the present year and
approved by the President on the 14th of March, is in conflict
with the letter relating to advances and a loan given by the
President to the four-power syndicate on the 9th of March, the
Chinese Government now regards the President’s letter of the 9th
of March to the four-power syndicate to be of force and
undertakes to cancel the clauses of the contract formerly made
with the Belgian syndicate which refer to a loan of £10,000,000.
After they shall have carefully consulted and agreed they will
in turn inform the representatives in Peking of the four powers
that they may take note of the fact.
Furthermore, the money received by the Chinese Government from
the Belgian syndicate will not be repaid to the Belgian
syndicate from any funds hereafter borrowed from the four-power
syndicate.
We have the further honor to request that your excellency will
take note hereof and direct the four-power syndicate at once to
resume negotiations with the Acting Minister of Finance with
regard to advances of money so as to relieve the very dangerous
situation. This will be just and expedient.
(Signed)
Tong Shao-yi,
Prime Minister
.
Hu Wei-te,
Acting Minister for Foreign
Affairs
.
Shih Chao-chi,
Acting Minister far
Finance
.
[Seal of the Prime Minister.]