HC Deb 09 January 1913 vol 46 cc1345-6

asked whether the British Foreign Office has required, as a condition of its support of the six-Power group of financiers, a disclosure by the constituents of that group of their agreements with certain firms whereby the patronage and influence of the group in controlling the expenditure shall be exercised in obtaining contracts for their nominees for a secret consideration, to the detriment of China and of investors; and what condition, if any, has been imposed on the group to prevent that practice?


I am not aware that the suggestion made by the hon. Member has any foundation in fact, and the answer to the question is in the negative.


asked whether, as against independent financiers offering money to China on less onerous terms, his Majesty's Government support the six-Power group in extracting from the Chinese Government an agreement for a loan of £25,000,000, with a right to the group to deduct and appropriate six points, not from the face value but from the sale price of the bonds, an unfixed figure which the group itself has power to manipulate in its own interest; and, if so, whether before this power is conferred upon a group of cosmopolitan financiers he will, in the interest of manufacturers and of the investing public, obtain an in dependent opinion of its soundness?


There is no question of the six-Power group extracting any agreement from the Chinese Government. The latter have, as I have constantly stated, spontaneously approached the group, and they are in no way bound to conclude a financial arrangement which is distasteful or detrimental to their interests. I am not prepared to intervene in the way that the hon. Member suggests.


Is not the right hon. Gentleman aware that the Chinese Government did not approach the group until they were prohibited from dealing with Mr. Crisp?


The Chinese Government spontaneously 'approached the group. They may have done so because they found it difficult to borrow elsewhere.


asked the Secretary of State for Foreign Affairs whether the security now offered by China to the six-Power group for a loan of £25,000,000 is the same as that given for the British loan of £10,000,000 negotiated by Mr. Crisp, with the difference for investors that it is weakened in value by the increase of the loan and that the expenditure will be under cosmopolitan instead of British control, and with the difference that Russia, which contributes none of the money and with which China is in conflict regarding territorial aggression, is joined in controlling this expenditure in Chinese domestic affairs; and if he can mention any advantage the cosmopolitan loan possesses over the British loan from the point of view of the investing public?


I am not aware that the Crisp loan made any provision for British control of expenditure. The investing public must form their opinion from the papers laid before Parliament and from other information which is public as to the comparative advantages of different loans.