Korean Customs is the one liquid asset of the country, the one well-administered branch of the revenue collecting departments, the one institution which has a reserve (rumoured to run into millions of yen) standing at its credit against future contingencies, and occupying the fortunate position it does; it is this revenue which perhaps, in Mr. Megata's eyes, should be sequestrated for the prosecution of reform plans. The Chief Commissioner does not share the new Financial Adviser's views, at least not in their entirety; for until these reform plans are more fully developed, he has no intention of surrendering a control which he has exercised to the satisfaction of all classes of traders and officials. It will be at once seen that the clumsy handling of a delicate situation may be fraught with dangerous consequences, and the rumour which persistently circulated in Seoul during the end of 1904 that the Financial Adviser had brought in his train an expert of high rank from the Customs department of the Tokyo Ministry of Finance, although it was probably baseless, showed the way public opinion was already blowing.

Whilst, on one side, the Japanese Financial Adviser has been feeling his way in this important Customs matter, and attempting to gauge the strength of various elements in Seoul, on the other, he was ordering the Korean Ministry to go through ten years of the nation's accounts and present résumés of expenditure and receipt, so that he might be able to frame some reliable estimate of Korean resources

and the system of speculation in force. This preliminary investigation is very necessary.

The Korean revenue amounts annually to a sum equal to ten million yen, or, say, a million sterling, which the expenditure always attempts, but with infrequent success, to exceed. The land-tax, as in all Eastern countries, is the great source of revenue, supplying in the case of Korea at least 80 per cent. of the total amount annually collected; whilst second in importance come the Customs receipts, which may be said to be 15 per cent. of the whole. Supposing the first great source of revenue were to be administered as cleanly as the second, it would be simple work to change completely the entire condition of Korea. It would seem, therefore, whilst the Japanese have the opportunity, that the survey of Korea and the careful remeasurement of all cultivated ground should be undertaken without loss of time as one of the very first measures necessary if Korean finance is to be placed on a solid basis. It is reasonable to suppose that at least forty to sixty per cent. of the revenue actually collected is "lost," as is the case in China; whilst probably another twenty per cent. of the land under cultivation escapes all taxation owing to the secret conniving of the Yangban or nobles, who possess large landed estates, and, exercising some influence at the corrupt Court, can terrorise impecunious territorial officials into filing false returns. Assuming that Korea has an area of 82,000 square miles, it is reasonable to suppose that one-fifth, or, say, ten million acres, are either cultivated

or occupied by towns or buildings, and that equitable taxation should produce from 15,000,000 yen to 20,000,000 yen, or, say, at least twice the present sum, thus providing a surplus from which the improvement of communications, &c., could be paid. The investigation of such an important question should therefore be proceeded with immediately, now that everything is over-ripe for action, and no time should be lost in the prosecution of shadowy schemes. The creation of a national Bank of Korea, the establishment of a Korean mint, simultaneously with the announcement of a monetary union between the peninsular and island empires and of the survey of Korea, would soon pave the way to other reform.

It will perhaps have been already realised what an important effect Japanese railway enterprise is having on the country. Districts which were practically sealed to the outer world are being rapidly placed within a few hours of the coast ports a state of affairs so satisfactory that large increases in trade will inevitably take place. But quite as important as the building of railways is the cutting of broad cart roads through all inland districts-roads which would soon act as feeders to the railways. During Mr. McLeavy Brown's brief tenure of office as Financial Adviser before Russian intrigues unseated him, it was due to his initiative that the splendid highways leading into Seoul were made. Scoffed at eight years ago, these roads now bear eloquent evidence of the crying necessity which existed for

better communication. To-day great bullock-carts crowd the thoroughfares from early morning to late night, conveying country produce and building materials to the capital in immense quantities, and carrying back to outlying districts the imports from abroad. Ten or twenty thousand miles of such good country roads would bring about an immense development in Korea and tend to remove the stagnation which exists in rich valleys simply because they are cut off from the outer world.

Thus the more one examines the whole question the more convinced does one become of two things in Korea to-day: first, that there is an immense amount to be accomplished, and, second, that it can all be done with the utmost ease so long as there is hearty co-operation amongst those who now occupy positions of trust and power. And not only this, but the various factions which now gaze at one another suspiciously can be fused into one harmonious whole with very little give and take on either side. But it is from the non-Korean side that the first movement must be made.

To-day there are five men in Korea who count. Taking them one by one they are: General Hasagawa, the Japanese Commander-in-Chief in Korea, Mr. Hayashi, the Japanese Minister Plenipotentiary, Mr. McLeavy Brown, the Chief Commissioner of Customs, Mr. Megata, the Financial Adviser, and Mr. Stevens, the Diplomatic Adviser. At present each of these officials is acting much as the Russian chiefs representing the various St. Peters

burg Ministries in Manchuria before the great war acted—that is, without being actually at loggerheads, each one is desirous of working out his own ideas and is not entirely enchanted with the ideas of his neighbour. Although the war-wave has swept far away from Korea, the Tokyo Government as late as October, 1904, made an important change in the matter of the military command. General Hasagawa, who commanded the picked Guards Division in Manchuria, was recalled, and after some important interviews in Tokyo was appointed Commander-inChief of the Japanese army of occupation in Korea, with the understanding that the force under his command would soon exceed a division. To an impartial critic the appointment would seem to have been unfortunate; for, fresh from the scenes of triumph, General Hasagawa, who is a soldier of the Moltke type, has chafed at his enforced inaction in Seoul, and has viewed with a growing irritation, as every soldier would, the suspicion and hostility which still exist sub rosa towards the Japanese everywhere in the Korean capital. Such suspicion and hostility are but natural where a Court-party, nominally still supreme, feels itself powerless to do anything but indulge in petty spites. Now that energetic measures are being taken by the Japanese to rid the Northern Hamkyông province of the small Russian forces which moved down there soon after the commencement of the war from Vladivostok and quartered themselves on the Korean inhabitants, the necessity of having such a military