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a counter-movement on the part of the provinces which has developed into a demand for almost complete fiscal autonomy.

As to the disposal of the increased Customs revenue, it will be necessary to exercise the utmost care to ensure that it does not go to the support of any of the rival factions now striving for political mastery of the country. The best course would probably be to earmark it for railway construction. The most crying need at the moment is the completion of the railway from Canton to Hankow, to connect the north and south and promote political unity.

It is to be hoped that the Commission will have the courage to resist the pressure, which is certain to be brought to bear, to devote a portion of the money to meet the service of unsecured loans. To make use of Customs funds to confer an ex post facto security upon wholly irregular transactions, which were entered into with a full knowledge of the risks they entailed, would encourage a repetition of the very malpractices it was one of the main objects of the Washington Conference to eliminate.

The last and far the most important of the four Treaties negotiated at Washington embodied the terms of settlement of the Shantung question. It represented at least 80 per cent. of the problems affecting China, and upon its successful issue the whole work of the Conference depended; for without it China would not have signed the Washington Agreements and the Senate of the United States would not have ratified them. The history of the Shantung question is fairly familiar to most readers. It had its origin in the Imperialistic designs of Russia and Germany. The two Emperors came to a tacit understanding to help themselves to desirable points of vantage on the coast of China. Russia selected Port Arthur and Dalny, and Germany obtained a lease of Kiaochow, with railway and other concessions.

Japan took the leased territory from Germany by force of arms; and in 1915, as a result of the Twenty-one Demands, China undertook to consent to any settlement Japan might make later with Germany. The Paris Peace Conference transferred to Japan all German rights and interests in Shantung. China refused to sign the Treaty of Versailles, and the Shantung decision aroused a storm of protests in China. For the first time in its history Chinese public opinion became a potent influence, and an outcry from all quarters of the country went up against what was loudly denounced as an act of Western treachery. A widespread boycott of all things Japanese ensued and was maintained with unparalleled severity and intensity. Great Britain, as the ally of Japan and a signatory of the Treaty, came in for a full share of the odium attaching to the transaction; and for a time China seemed to have lost faith in Western justice. The rejection of the Treaty by the United States Senate brought the first hope of relief and encouraged Chinese resistance to the many earnest attempts which Japan subsequently made to come to an amicable arrangement.

In view of the past history of the question, it was impracticable to take it up officially at Washington. But it was felt that the Conference presented an admirable opportunity for bringing the parties together to thresh out their differences under its auspices. To facilitate this, the good offices of Mr Hughes and Mr Balfour were offered to both sides and gratefully accepted. British and American observers watched the proceedings, which were conducted entirely in English. After more than thirty meetings, extending over three hours each, an agreement was finally reached disposing of this vexed question in a way that has given general satisfaction.

During the fifteen years of their tenure of Kiaochow the Germans spent immense sums in developing the Port of Tsingtao, in constructing excellent roads throughout the territory, and in afforestation schemes which engaged the personal interest of the Emperor, and were justly regarded by him as a valuable object lesson to the Chinese. Kiaochow was, in its appearances as in its administration, a bit of Germany transplanted to China. The trade of the port attained rapid development. The Tsingtao-Tsinan railway, 265 miles in length, connected it with the interior; mines along the line were worked with German capital; and the whole province became to a large extent a German preserve. The Japanese maintained and greatly improved the territory during the seven years it was in their possession. The question which the Delegates were called upon to solve involved not merely the rendition of one of the finest ports in China and of a surrounding tract of 190 square miles, but also the disposal of many millions worth of property, all of which had been the fruit of German and Japanese enterprise. From the outset it was realised that the crux of a settlement lay in the railway. The Chinese had experienced the effects of railway penetration in Manchuria and were determined that the process should not be repeated in China Proper. Without the railway, the rendition of the leased territory would, from their point of view, have been worthless. They were accordingly anxious to place the railway question in the forefront of the programme. The Japanese preferred to take it later, and, as it turned out, this was a wise decision, as it gave time to consider the matter in the favourable atmosphere which the success of the negotiations gradually created.

The Treaty, as finally arranged, is a lengthy document consisting of 28 Articles. A brief summary of its leading provisions will be sufficient.

Japan restores to China the whole of the leased territory of Kiaochow; and China, on her part, declares that the entire area will be opened to foreign trade and residence. The railway from Tsingtao to Tsinanfu and its branches, as also the wharves, warehouses, and other similar properties, are to be transferred to China. China reimburses to Japan the actual value of the railway, which is assessed at 53,406,141 gold marks. To effect this payment, China is to deliver to Japan Chinese Government Treasury Notes secured on the revenue of the railway, running for fifteen years, but redeemable after five years. Pending the redemption of the notes, China is to employ a Japanese traffic manager and a Japanese chief accountant, both under the Chinese managing director.

The Custom House at Tsingtao, which, under the German régime, was exclusively staffed by Germans, is to be made an integral part of the Chinese Maritime Customs, and the staff will be drawn from all nationalities without discrimination. All Japanese troops are to be withdrawn from the railway within six months, and from Tsingtao within thirty days, and thereafter no military force of any kind is to remain in any part of Shantung. The submarine cables between Tsingtao and Chefoo and Tsingtao and Shanghai become the property of China, which also takes over the wireless stations at Tsingtao and Tsinanfu on payment of fair compensation.

Such is a rough outline of the terms under which China regains control over the principal port and leading lines of communication in Shantung, which, but for the war and the success of the Allies, she had no prospect of doing for nearly eighty years. The only vestige which Japan retains of the dominating position she held in the province is an interest in the railway similar to what Great Britain and other Powers have in other Chinese Government railways; and even this expires in five years' time, unless China fails to exercise her option of redeeming the bonds.

The retrocession of her Shantung rights was an act of wise statesmanship on the part of Japan, and Baron Shidehara was fully justified in stating that Japan had made every possible concession compatible with a sense of reason and fairness.

A word as to China's opportunity and responsibilities. She has acquired a fine port equipped with every modern facility, a first-class railway, and an immense amount of other property which she could never have created by her own efforts. The world will judge her by the use she makes of them. If she allows the railway to fall into disrepair or to become the prey of rival military factions, or if she fails to provide an efficient municipal administration for the foreign business community at Tsingtao, she is not likely to receive much sympathy or support in any future claim she may make for the restoration of similar rights.

It only remains to notice the Resolutions adopted by the Conference, which cover a wide variety of questions connected with China. Foreign postal agencies, extraterritoriality, radio stations, foreign troops in China, unification of railways, the reduction of Chinese military forces, and the Chinese Eastern railway, all came under review at Washington. The withdrawal of the foreign post offices, to take place not later than Jan. 1, 1923, is a somewhat tardy recognition of the efficiency of the Chinese postal system under its French Director-General.

Japan emancipated herself from extra-territorial restrictions many years ago, and Siam is making considerable progress in the same direction. China, alone of Far Eastern countries, remains under this régime, and it is hard to see how any material relaxation can be made in her favour until, in the words of Dr Willoughby, a very sympathetic critic, ‘it is made certain, as a matter of actual fact, and not as one of paper regulation or declared intention, that there exists in China a fairly complete body of ascertainable law administered by a system of courts which by reason of the learning, experience, probity, and freedom from political or executive interference of their presiding judges commands the confidence of the Western Powers.'

As things are at the moment, Courts and Judges alike are powerless before military satraps who recognise no law but force. In this, as in many other ways, China

, has missed a great opportunity Russians have been amenable to Chinese jurisdiction for some considerable time, and the manner in which it has been exercised has created a very unfavourable impression among foreign residents, who appear to be more convinced than ever that the time is still distant when their vast interests in China can safely be entrusted to Chinese Courts. As, however, it is twenty years since several of the Powers formally declared that they would relinquish their ex-territorial rights when satisfied that the state of Chinese laws and their administration should warrant them in so doing, it was agreed that a Commission, in which China would be represented, should be appointed to investigate the whole question and furnish a report.

The remaining Resolutions record hopes and expressions of views which will doubtless bear fruit some day, but are not likely to be realised in the immediate future. The unification of railways, for instance, is most desirable, but the construction of new railways is much more important. China requires, at least, an additional 30,000 miles of railway, and at the present rate of construction is not likely to get it for one hundred years.

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