File No. 893.811/210
Minister Reinsch to
the Secretary of State
No. 923
American Legation,
Peking,
February 4, 1916.
Sir: I have the honor to report that in
pursuance of the plan outlined in my telegram of January 4, and
sanctioned by your telegraphic instructions of January 10, I have
arranged with the Chinese
[Page 104]
Government to grant an extension of the Huai River Preliminary
Arrangement for four months from January 31, for the purpose of giving
Messrs. Carey and Gregory the time necessary for investigating the Canal
project as a separate undertaking. It has been arranged that in case the
American representatives find the Canal project feasible and undertake
the execution thereof, the American International Corporation is then to
be granted the extended option for financing and carrying out the larger
irrigation project in the Huai River region.
I have the honor to enclose the following correspondence relating to this
matter:
To the Minister of Agriculture and Commerce, January 14, 1916.
From the Minister of Agriculture and Commerce, January 25, 1916.
From the Minister of Agriculture and Commerce, January 31, 1916.
Messrs. Carey and Gregory are planning to proceed, on February 7, on a
tour to inspect the canal between the Yellow and Yangtze Rivers.
I have [etc.]
[Inclosure 1]
Minister Reinsch
to the Minister of Agriculture and
Commerce
American Legation,
Peking,
January 14, 1916.
Excellency: I have the honor to inform you
that, under the terms of the Preliminary Agreement of January 30,
1914, entered into between the Chinese Government and the American
Red Cross, with respect to the drainage of the Huai River and Grand
Canal areas, the following proposal is submitted:
It is suggested that the restoration of the Grand Canal, from the
Yangtze River to Tientsin, be first undertaken, and that the Chinese
Government allow the American International Corporation, which has
been nominated by the American Red Cross, a period of four months to
investigate the feasibility and cost of restoration of the Grand
Canal. If the representatives of the corporation approve of the
plan, the corporation will raise the necessary funds under a Chinese
Government loan upon such security and at such a rate as is to be
agreed upon between the Government and the corporation at that time.
In case this work is to be undertaken, the American International
Corporation, as nominee of the American Red Cross, would be given
the option of carrying out the larger plan of draining the Huai
River region, when the restoration of the Grand Canal shall have
been completed. It is also suggested that, during the progress of
the above work, the Chinese Government, might provide funds from
specified revenues sufficient to pay the necessary interest charges
in order to apply the amounts borrowed, without deduction, to the
accomplishment of the work.
I have the honor, in this connection, to introduce to your excellency
Mr. W. F. Carey and Mr. E. T. Gregory, representatives of the
Siems-Carey Company, who have been designated by the American
International Corporation as its representatives in this matter. I
beg also to request that your excellency will be so good as to
introduce these gentlemen to his excellency Mr. Chin Pang-ping, Vice
Minister of Agriculture and Commerce, and Chief of the Bureau of
Conservancy.
I avail [etc.]
[Page 105]
[Inclosure 2—Translation]
The Minister of Agriculture and
Commerce to Minister Reinsch
Peking,
January 25, 1916.
Sir: I have the honor to acknowledge the
receipt of your communication, in which you state that under the
terms of the Preliminary Agreement of January 30, 1914, entered into
between the Chinese Government and the American Red Cross with
respect to the drainage of the Huai River and Grand Canal areas,
there are two propositions which may be made. You introduce Messrs.
W. F. Carey and E. T. Gregory, representatives of the Siems-Carey
Company in China.
I have referred the matter to Mr. Chin, the Director General of the
National Conservancy Bureau, for consideration, and now am in
receipt of his reply, a copy of which I now enclose for your
consideration.
With compliments,
[Subinclosure—Translation]
The Director General of the
National Conservancy Bureau to the Minister of Agriculture and Commerce
Excellency: I have the honor to
acknowledge the receipt of the communication from the American
Minister which you handed to me, setting forth two proposals, under
the terms of the Preliminary Agreement of January 30, 1914, entered
into between the Chinese Government and the American Red Cross, with
respect to the drainage of the Huai River and Grand Canal areas, and
also introducing Messrs. W. F. Carey and E. T. Gregory, of the
Siems-Carey Company, representatives of the American International
Corporation.
A communication was also received from the American Minister in the
same sense as the above.
It is noted that the first proposal in the American Minister’s
communication is to restore the Grand Canal from the Yangtze River
to Tientsin; also that in accordance with the conservancy area fixed
upon in the Preliminary Agreement, that part relating to the Grand
Canal is the Inner Grand Canal from Kwachow to Tsingkiangpu and from
the point where the I and Ssu Rivers enter the Grand Canal up to Yao
Wan. The preliminary agreement is still in force and it is not
expedient to discuss changing it. This sincere and friendly effort
on the part of the Americans is nevertheless much appreciated.
It happened that Pan Fu, Director General of the project for
restoring the Southern Grand Canal and the Hu River in Shantung
Province, had come to Peking to raise the funds required for this
work. Messrs. Carey and Gregory having been invited to the Bureau to
enter into negotiations, it was proposed that the administration of
Shantung Province first enter into a foreign loan for restoring the
Southern Grand Canal, the amortization, payment of interest, and
security of which should all be arranged by Shantung Province.
Furthermore, such matters as the employment of technical experts and
the construction work to be decided by negotiation between the
Province of Shantung and the parties making the loan. Before the
loan agreement shall have been fixed notification thereof should be
sent to the Central Government for its approval and recognition. The
important points of these negotiations were explained to both
parties. Messrs. Carey and Gregory stated that they would proceed at
once to inspect the Southern Grand Canal. Director General Pan
returned to Shantung day before yesterday to make arrangements. This
Bureau will also send Fang Wei-yin, an engineer, and Yang Pao-ling,
a technical expert, to make an additional inspection in order to
meet its obligation to afford assistance and furnish
information.
Your excellency is hereby informed of the status of the negotiations
with the Americans Carey and Gregory, and the hope is expressed that
you will take note thereof and inform the American Minister.
With compliments.
[Page 106]
[Inclosure 3—Translation]
The Chinese Minister of
Agriculture to Minister Reinsch
Peking,
January 31, 1916.
Sir: On the 30th of January, 1916, I
received a letter from Chin Pang-ping, Director General of the
National Conservancy Bureau as follows:
You have handed to me the letter of the American Minister
relating to the improvement of the Grand Canal from the
Yangtze River to Tientsin. The Chinese Government has agreed
to grant four months’ time to the American International
Corporation, recommended by the American Red Cross Society,
for an investigation as to the way of carrying out the work.
If this undertaking is really commenced then the American
International Corporation shall be given the preference,
after the improvement of the Grand Canal is completed, in
the matter of the conservation work in the Huai River basin.
I, the Director General of the National Conservancy Bureau,
have already reported to you the results of my interview
(with the representatives of the International Corporation)
for transmission to the American Minister. Now the period
for the consideration of the Huai River loan was extended
for one year in January, 1915, so that the time expires on
January 31, 1916. In order to show the friendly feeling
which exists between China and America it is now proposed to
give a further period of four months to the American
International Corporation designated by the American Red
Cross Society, in which to inspect the Grand Canal in the
provinces of Shantung and Kiangsu. Within this period an
estimate of the labor required for the above-mentioned Grand
Canal must be presented and the terms of a loan must be
settled. If the Bureau accepts the proposition made within
this limit of time, preference will then be given to the
Corporation in the large conservation work of the Huai River
basin, after the completion of the above-mentioned work on
the Grand Canal. Thus will be manifested and consolidated
the friendship between the two nations. If within the
above-mentioned four months matters cannot be settled, this
Bureau will consider it decisive, and no extension of the
time will be granted. You are asked to notify the American
Minister and give me a reply.
Having received this communication I now inform your excellency and
ask for a reply.
With compliments.
