File No. 893.811/201.

Minister Reinsch to the Secretary of State.


Please inform me concerning state of Huai River negotiations. The Chinese Government is in an expectant attitude as to whether the United States will be able to accomplish this enterprise and desires very much to see improvement undertaken. It might be possible for me to prevail upon the Government to set aside sufficient [Page 215] revenue to meet the interest charges on the capital during the time of construction thus reducing the amount of the loan and improving security. If considered essential it might also be possible to obtain period of six months for further examination and report by the engineers of the bankers, [if?] the latter actually would agree to furnish the capital unless the engineers should pronounce work unprofitable or not feasible. It is hoped that this great work of progress with which the American name is linked may now actually be undertaken while the influences in the Government are favorable and ready to make the most liberal arrangements.