CAPITAL IN CHINA.

Dominion, Volume 2, Issue 453, 11 March 1909, Page 5

CAPITAL IN CHINA.

RAILWAY BUILDING. CONTRACT VIOLATED. |BY THI.KGttANI—PRESS ASSOCIATION—ITOrYRiafIT.) PsKing, March 9. Dr. G. E. Morrison, tho Peking correspondent of "Tho Times," recently visited tho Shanghai-Ningpo railway. Ho states that tho million and a half of British money invested is being squandered owing to tho Chinese 'disregarding tho contract requiring British supervision and tho use of British material. Dr. Morrison also states that every important financial stipulation in tho contract has been violated. HOW CHINA VIOLATES CONTRACTS. DISGRACEFUL CONSTRUCTION. . Tho Shangliai-Ningpo railway referred to above is an important lino 211) miles in length, and tho contract fur its construction was signed on March 6, 1908. The conditions were stated to be that tho lino was to be constructed within three years from tho date of the signature of , tho contract, under a British chief engineer. On these terms the Yu-ehuan-pu (China's Ministry for Communications) borrowed .£1,500,000 of British capital—tho million and a half referred to in the cablegram. A British engineer was duly appointed, but the Yu-chuan-pu permitted the Provincial Railway Bureau to repu-

diate his, appointment. The Peking correspondent of "The Times" wrote last October that this engineer, " who was induced to leave a good appointment, has received one month's pay, is now in Shanghai without an agreement, and is forbidden -to interfere in the construction of the railway." Tho correspondent added that, at that time, the money borrowed was "lying untouched in the bank." Now, however, it would appear that the Chinese are expending the money and squandering it. Railways, it would seem, fall within tho Department of " the corrupt Minister, Chen-pi." In his October message, "The Times" correspondent further declared that "no attempt has been made to fulfil the terms of tho contract. . . . The line constructed is an elementary one and is in a disgraceful condition. It will reqiiiro rebuilding, while the rolling stock of various patterns, bought without expert supervision, causes amusement to those onlookers who aro not shareholders, . . . Complaints of violation of contracts are being received from nearly every railway in China in which British capital is interested, and aro engaging the serious attention of the. British Legation. The Canton-Kowloon Railway is in constant difficulties. The Shanghai-Nanking Railway, owing to likin obstruction, is virtually forbidden to earn money by carrying freight, and the earnings are therefore insufficient to pay interest tin the capital. The large deficit will, by the terms of the Government guarantee, have to be made good by tho Chineso Government from an inelastic revenue." ,