of being repaid with the proceeds from the issue of the loan bonds referred to above. ARTICLE 14. The payment of the advance, its redemption and the payment of its interest and other transactions in connection therewith shall be carried out at Tokio. Two copies of the present preliminary agreement shall be written in the Chinese language and two copies in the Japanese language and A and B shall each keep one copy written in each language. In case any dispute arises with regard to the interpretation of the agreement, the text of the one written in Japanese shall be considered as authoritative. Note The Peking Times of July 2nd, 1918, printed the following statement concerning the report of the Minister of Communications in regard to this agreement: "The following is the official report of Mr. Tsao Ju-lin, Minister of Communications, concerning the Kirin-Hueining Railway loan. This report was sent to President Feng for approval on the twenty-fifth June and it was sanctioned on the twenty-ninth of that month: ""The Kirin-Hueining line will pass through the southern part of Yenchi (Chientao) and the Tumen river to Hueining, Korea, travelling fertile districts full of iron and other mineral deposits. According to the third article of the Sino-Japanese agreement signed in the thirty-third year of the reign of Kuanghsü (1907) concerning the construction of the Fengtien-Hsinmintun and Changchun-Kirin lines [Agreement of Apri! 15, 1907 (No. 15, ante) ], it was stipulated that, in case of need, an extension of the Changchun-Kirin railway be built with Chinese funds; but if Chinese capital cannot be procured for the purpose, then the Chinese government should consult the Japanese government about same. Further, this was also mentioned in the sixth article of the Sino-Japanese treaty about the Tumen river frontier signed in the first year of the Hsuantung reign of the defunct Taching Court. [No. 28, ante.] Hence after the completion of the second loan for the Kirin-Changchun line last year [No. 41, ante]_the Ministry of Communications was approached by the Peking representative of the Japanese Industrial Bank in May last for the construction of the Kirin-Hueining line. After considerable negotiations on both sides, a draft agreement was signed by them on the 18th June, 1918, consisting of fourteen articles. It was agreed that after the signing of the agreement, the Japanese Industrial Bank, the Bank of Taiwan and the Bank of Chosen would immediately advance the sum of ten million dollars to the Chinese government at the rate of seven and half per cent per annum without commission. In pursuance of this condition, ten million dollars were paid into the Tokio office of the Sino-Japanese Exchange Bank on the nineteenth June to the credit of the Peking government who are at liberty to use it without condition. "With regard to the construction of the Kirin-Hueining Railway, the actual amount will be decided by the Chinese government and the above-mentioned three banks will then issue bonds in Japan on its behalf. The bonds will be issued in gold currency to be refunded within forty years from date of issue with the railway and its incomes as securities. ““The construction of the Tumen river iron bridge will be undertaken in conjunction with the railway department of the Chosen Government-General and the cost is to be equally divided by the contracting parties. All other conditions which are not mentioned in the draft agreement will be drawn up by the two contracting parties in accordance with the Tientsin-Pukow Railway Loan signed in January, 1908. [MACMURRAY, vol. i, p. 684.]' "Mr. Tsao says that this line will be completed in four years and that with the exception of this there is no other railway loan with foreign capitalists at this moment." No. 43 JAPAN (Exchange Bank of China, in association with the Japanese Banking Syndicate consisting of the Industrial Bank of Japan, the Bank of Chosen, and the Bank of Taiwan) AND CHINA Agreement for a loan for gold mining and forestry in the Provinces of Heilungkiang and Kirin (Manchuria).'—August 2, 1918 The following terms have been agreed upon by the two parties in the matter of a loan by the Government of the Republic of China (hereinafter called A) from the Exchange Bank of China (hereinafter called B) of yen 30,000,000 in Japanese gold as a fund for the development of gold mining and forestry in the two provinces of Heilungkiang and Kirin: 1.—The amount of the loan shall be yen 30,000,000 in Japanese gold. 2. The loan shall be for a period of ten years reckoned from the date of signing the agreement, that is to say up to the 1st day of the 8th month of the 17th year of Taisho, or the 1st day of the 8th month of the 17th year of the Republic of China; provided, however, that upon the expiration of this period it may be extended by mutual consent. 3. After five full years have elapsed, reckoning from the signing of this agreement, a portion of the loan may be repaid at any time upon the giving of notice of six months in advance. 4. The interest on this loan shall be payable at the rate of 7.5 per cent., that is to say, yen seven sen fifty per hundred yen in Japanese gold; provided, however, that in the case of extension as provided in Article 2, the rate may be raised or lowered by mutual agreement, according to the prevailing rate, with the purpose in view of making it as favorable to A as possible. 5. The first payment of interest shall be reckoned at a per diem rate from the date of the delivery of the amount of the loan to the 14th day of the 1st month of the 8th year of Taisho, and shall be paid in advance. The portions for the ensuing six months shall be paid in advance on January 15 and July 15; provided, however, that the amount of the last period shall be reckoned at a per diem rate up to the date of the expiration of the loan. 1 MACMURRAY, vol. II, 1434, translation from the Japanese text as made public by the Japanese Government on April 16, 1919. A translation from the Chinese text of this agreement (without the annexed letters) was printed in Peking Leader of April 17, 1919. In connection with this agreement, see the agreement concerning mines and railways in Manchuria, September 4, 1909 (No. 27, ante). 6. The amount of the loan shall be delivered without any discount. 7. The delivery of the amount of the loan, its redemption, payment of interest, and all other payments, shall all take place at Tokyo, Japan. 8.-A shall offer B as security for the payment of principal and interest the following: I. The gold mines and national forests in the Heilungkiang and Kirin Provinces. II. The Government's revenue from the said gold mines and national forests. 9. In case A, within the period of the operation of this loan agreement, desires to make a loan from others in respect to mines, national forests and their revenues, or to dispose of them, it shall first consult with B. 10. This loan agreement shall automatically be cancelled as a result of the repayment of its principal and interests. Two copies each in Japanese and Chinese of this agreement shall be prepared and sealed, one each to be retained by the Ministries of Agriculture and Commerce and of Finance on the one part, and by B on the other. If any doubts arise as to the interpretation of the agreement, it shall be interpreted according to the Japanese text. 2nd day of the 8th month of the 7th year of Taisho. 2nd day of the 8th month of the 7th year of the Republic of China. (Signed) TIEN WEN-LIEH, Minister of Agriculture and Commerce of the TSAO JU-LIN, Minister of Finance of the Republic of China. LU TSUNG-YU, President of the Exchange Bank of China. TSUNEJIRO KAKIUCHI, Managing Director of the Exchange Bank of THE EXCHANGE BANK OF CHINA TO THE MINISTRIES OF AGRICULTURE AND COMMERCE, AND OF FINANCE Gentlemen: This bank having now concluded a loan agreement in connection with gold mining and forestry in Heilungkiang and Kirin provinces by obtaining capital from the Industrial Bank of Japan, the Bank of Taiwan, and the Bank of Chosen, which are represented by the Industrial Bank of Japan, we make the following declarations in order to make clear the purpose not to injure the vested rights and interests of those who are engaged or interested in gold mining and state timber felling enterprises in the two provinces. I. The vested rights and interests of those who are engaged or interested in gold mining in Heilungkiang and Kirin provinces as official or private enterprises under permission of the central or local governments shall be respected, and by the establishment of a gold mining office and other equipment in future the business of these persons shall be protected, improved and developed, profits increased and also the revenue of the government shall be augmented. II. The vested rights and interests of those who are engaged or interested in timber felling in the state forests in Heilungkiang and Kirin provinces as official or private enterprises under permission of the central or local governments shall be respected, and by the establishment of a forestry office and other equipment in future the business of those people shall be protected, improved and developed, profits increased, and also the revenue of the government shall be augmented. 2nd day of the 8th month of the 7th year of the Republic of China. To His Excellency Tien Wen-lieh, Minister of Agriculture and Commerce of the Government of the Chinese Republic; and His Excellency Tsao Ju-lin, Minister of Finance of the Government of the THE EXCHANGE BANK OF CHINA TO THE MINISTRIES OF AGRICULTURE and Gentlemen: COMMERCE, AND OF FINANCE This bank having concluded a contract for the loan of 30,000,000 yen Japanese Currency for the purpose of developing the gold mining and for estry enterprises in Heilungkiang and Kirin provinces by obtaining the supply of funds from the Industrial Bank of Japan, the Bank of Taiwan, and the Bank of Chosen, which are represented by the Industrial Bank of Japan, we hereby beg to ask for a letter of approval consenting to the production as security, in accordance with the stipulation of the last clause of the provisional contract concluded between your Government and this bank on July 3, of the claims based on the loan contract, and the production as collateral security of the revenue of the Government accruing from the gold mines and State forests in Heilungkiang and Kirin provinces which are offered as security for this loan. August 2, 7th year of the Republic of China. (Signed) LU TSUNG-YU, President of the Exchange Bank of China. TSUNEJIRO KAKIUCHI, Managing Director of the Exchange Bank of To His Excellency Tien Wen-lieh, Minister of Agriculture and Commerce of the and 'His Excellency Tsao Ju-lin, Minister of Finance of the Government of the THE EXCHANGE BANK OF CHINA TO THE MINISTRIES OF AGRICULTURE AND COMMERCE, AND OF FINANCE Gentlemen: With regard to the declaration contained in your following letter dated August 2, 7th year of the Republic of China, we beg to reply that our bank feels satisfied in view of the motive for which the loan contract relating to gold mining and forestry in Heilungkiang and Kirin provinces has been concluded between this bank and your Government. The letter follows: "The Government of the Chinese Republic having concluded with your bank the loan contract relating to gold mining and forestry in Heilungkiang and Kirin provinces by means of capital obtained by your bank from the Industrial Bank of Japan, the Bank of Taiwan, and the Bank of Chosen, |