Lords Sitting of 10 November 1926

Preamble
The House met at half past three of the clock, The LORD CHANCELLOR on the Woolsack.

AFFAIRS IN CHINA.
LORD PARMOOR LORD PARMOOR had given Notice to ask His Majesty's Government whether they can give further information on the position of affairs in China; and to move for Papers. The noble and learned Lord said: My Lords, I am anxious to emphasise at the outset that my Question has no Party-political character at all. I am sure the noble Earl will appreciate that. Perhaps I may also say that, on rather wider ground, I often wish that matters in which we have common interest, such as foreign policy, the League of Nations and Imperial matters, could be settled by national rather than Party conferences, because I think in that way there would be a much greater chance of stability and consistency than is the case as matters are arranged under our Party system at the present moment. That makes me add, however, that while our present system is in vogue it is of great importance that every information possible should be given in order that all Parties may consider on information supplied how the policy or matter stands and in order that there may be room for that measure of public discussion which is useful if we are to have a common national policy on questions of this kind.
The importance of the subject matter of my Question was emphasised by what was said by the Prime Minister at the Guildhall banquet last night. Speaking optimistically generally, he said this:
"In China we are confronted with a difficult situation, damaging to our interests there, but far too difficult and complicated for discussion in the short time that I have to-night."
I think, or I hope, we shall have ample opportunity for discussion this evening, but, no doubt, when we come to China there are difficult and complicated matters of discussion and our interests there are very wide indeed. Perhaps, as a watchword for this discussion—and I do not think it is out of accord with
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what the noble Earl said when I last asked him a Question on this subject in July—I might refer to what Sir Charles Addis said at Washington. Sir Charles Addis is Chairman of the Hong Kong & Shanghai Bank. He is also a director of the Bank of England. But he deals in human standards as well as in gold standards, and he expressed his view of the way of dealing with this kind of difficulty in two words which I think should have real attention. I think they go a very long way as regards the principles which ought to be adopted.
He said that what were necessary in order to bring these China difficulties to a satisfactory conclusion were patience and conciliation. From such study as I have been able to give to this matter—and I do not think the noble Earl will differ from this—it is essential, in dealing with a country like China and under the conditions there, that we should have a very large measure of patience and above all things that we should try to promote conciliation. Just lately, as the noble Earl will know, a very important document has been published to which I will refer shortly, because in that way I can bring to the mind of the House most clearly the very large nature of our commercial, industrial and economic interests in China. If ever there was a time when, owing to conditions of industrial trouble and unemployment, we ought to be careful to use conciliation or any method of that kind in dealing with our commercial, industrial and economic interests wherever they are situated, that time is now. It is of very great importance for employment in this country.
The report to which I refer was published, I think, a fortnight ago. It is a very remarkable report. It is a report on the commercial, industrial and economic situation in China by Mr. George, acting commercial secretary, Shanghai, together with a report of the trade of South Manchuria. I have read many reports, as we all have, but I am bound to say that this report shows an exhaustive research and an ability of exposition which bring the whole matter to one's mind in the shortest possible way. It would be impossible to ask your Lordships to digest a report of this kind at an afternoon's sitting, but those of your Lordships who may be particularly interested may look at page 42 of that

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report either now or at some future time. The report was issued by the Department of Overseas Trade, I think, about a fortnight ago. On page 42 there is rather more than a paragraph dealing with British trade with China and it is a very remarkable passage because it shows not only the wide nature of our economic and industrial interests in China but the extent to which those interests have been threatened by certain unfortunate events, as I may call them, which have taken place in that country.
Let me give one or two of the figures that summarise the position. In the crucial year, that is up to June 30, 1926, the Imports from the British Empire, excluding Hong Kong from the calculation, fell from Tls.197,000,000 to Tls.160,000,000. I do not deal with decimals as it is sufficient to give round figures. The report states further—and I think this gives cause for much meditation—that the British share of the carrying trade fell from 38·71 per cent. to 28·14 per cent. That information regarding the carrying trade may be carried a little further from a report coming from what I am told is a trustworthy British source—namely, the Tientsin British Committee of Information—in a memorandum published in Tientsin on September 18 of this year. This gives corroborating figures, which again show how much ground there is for anxiety regarding the friendly relationship between China and this country. For the period from July to December, 1924, the number of British steamers was 681 and their tonnage 918,000—again keeping to round figures. From July 1, 1925, to December 31, 1925, there were only 88 steamers in place of 681, with a tonnage of 116,143 instead of 918,000. That shows how enormously British interests have suffered. There is a note to the effect that further figures are not yet available because the Customs returns are said to be invariably late.
There is just one other fact upon which I should like to touch in summarising the character of the interests with which we are dealing in China. I have figures in a later portion of Mr. George's report which provide a convenient summary. He says:—
"It is impossible to assess the precise damage caused to British interests by this agitation"—
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that was the agitation in connection with the boycott—
"but the following details give some idea of its widespread consequences. The boycott rendered idle for four to five months over 100 British vessels normally engaged on the coasts and rivers of China, and diverted large numbers of ocean vessels to Singapore, Manila and Japan ports.… It put a stop for some four months to all work in British industrial concerns in Shanghai, including cotton mills, shipyards, soap and cigarette factories."
Mr. George goes on to say—and I do not want to emphasise a matter of this kind for I think it must be obvious even from the outline of figures that I have given—
"….while many orders for British goods were given to German and other foreign firms in order to conceal their origin. Native agents of foreign firms competing with British were not slow to encourage and subsidise the agitation for their own ends."
The importance of that last statement is that it unfortunately shows that the British as traders in China and the British people generally have, owing to recent conditions, become extraordinarily unpopular.
As the noble Earl knows, this is a most important matter in all questions of trading interests in China. I had the advantage of meeting yesterday an American who has lived most of his life in China. He tells me that there is undoubtedly a tendency there to attribute all the evils that come from foreign interference to the British alone, because they had been in the forefront of these trade developments and were accordingly made a special point of attack. That is very unfortunate, and anything that can be done to dissipate a notion of that kind would, I am sure, have the attention of the Foreign Office and of the noble Earl opposite.
There is one point that is rather outside my general Question but upon which I should like to say a word, particularly as I see the noble Viscount, Lord Cecil of Chelwood, on the Front Bench opposite. I will merely mention it now because a debate on League of Nations questions is to take place next week. The point that has been raised is that, supposing you desire conciliation—as I am sure we all do—there is no better way in which we are likely to obtain it than by approaching the League of Nations under the well-known Article 11 of the Covenant. The

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words of that article are sufficiently wide to embrace almost any difficulty, and I think they would cover a difficulty of this kind. I do not want to emphasise that point to-day; I merely mention it as suggesting one of the possible pathways towards conciliation. I am well aware that Mr. Chu, the Chinese delegate to the League of Nations, took an attitude which naturally alienated the general spirit of the Assembly, which is always a spirit of fairness and fair play, because they thought that certain matters that he brought forward ought not to have been brought forward without proper notice to the other parties concerned. I do not want to follow that point further, but I did not like to omit it altogether, because it appears to me to suggest one of the directions in which we may look for conciliation.
On July 27 I asked a Question—I will not say a similar Question—of the noble Earl opposite, who made a very notable reply, but unfortunately it was at a very late hour of the evening. I have no doubt that the noble Earl will recall the fact that the burning of heather in Scotland took up so much time that it was eight o'clock before he was able to finish his reply on matters of foreign and Imperial affairs. I only wish to say this: I expressed the view then that on general matters, general attitude and general method of approach it seemed to me that he enunciated absolutely right lines of policy. I can assure him that I am in no way attacking the lines of policy which he then laid down when I come presently a little more to matters of detail. He said that the suggestion of using foreign military coercion in China was fantastic and he gave reasons—I will not go into all the admirable reasons he gave—as regards the bulk of territory and the population involved, but he expressed himself in a way with which I humbly and entirely agree and which showed that any suggestion of that kind might be put on one side. He said, with regard to the way of approaching questions of this sort, that China must work out her own salvation. I think that is the only way in which you can ultimately get peace and conciliation on questions of this sort.
But he also said this—he will forgive me for quoting this again, but it is very important:—
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"… what we desire most earnestly, most sincerely, is to co-operate with China, to help where we legitimately can, to recognise that we and the Chinese, so far as commerce and economic affairs are concerned, have common interests and, as regards the organisation of their own country, our hope is that there will be no difficulty in their managing their own internal affairs."
Having said that, he at once put his hand upon the points of difficulty. He said, and of course I know,
"that there are difficulties in connection with the Maritime Customs and other points connected with Treaty rights, which certainly require modification and reform, and perhaps even the oldest of us may live to see that they are removed."
The special points that I want to ask about have relation to what are called difficulties in connection with the Maritime Customs and other points connected with Treaty rights, because we want to be assured, if we can, that the general principles so admirably enunciated by the noble Earl are put into practical operation when you come to deal with these particularly difficult subjects.
Perhaps there is one other general matter on which I should like to say a word, and it is this. When the matter was last before the House the noble Earl pointed out the difficulties which had arisen owing to the position in Canton and Peking, and also to the fact that a large portion of the territory of China was under the control of rival Generals, and he answered the question which I then put. I suggested then that a real policy for this country would be to follow Canton as closely as we could. Since that time—my only information is from the newspapers—Canton and the power of Canton have made great advances, and I saw in the paper yesterday, or to-day, that the Province of Kiangsi, a very important Province in China, which has a population of about 20,000,000, has transferred its allegiance from the Northern General to Canton—in other words, has taken its place on the side of the Southern interests of China, and not on the Northern side. That is a very important matter, and I have no reason for doubting its perfect accuracy, but if there is any further information which can be given upon that point I ask the noble Earl to be kind enough to give it.
The points to which the noble Earl referred, when he came to the difficulties, were several—too many to deal with on one occasion—but I want to ask what advance has been made with regard to one or two of them. First of all, and it is really a very important matter, there is the question of extra-territoriality. Since the War the principle of extra-territoriality has been questioned, and there has been a general opinion amongst the countries which were subject to the extra-territorial principle, that they would like to get rid of it, so far as they consider it inconsistent with their sovereign rights. It is, I admit, a difficult question. I am the last person who would desire, or think it right, that a principle of that kind should be abrogated by what is called denunciation. If you make changes in a matter of that sort you must substitute in its place adequate protection for foreigners—I do not use the word British, but foreigners—and I am the last person to suggest, for one moment, that you ought to admit the denunciation of a principle of that kind as apart from entering into negotiations and conferences for the purpose of getting, if possible, adjustment and agreement.
If I am right, at the Conference at Washington, in 1922—I think the noble Earl was present—this question was discussed and considered, and a Commission was appointed in order that by adjustment and arrangement some fair proposal could be made. I was told the other day—I put no weight upon the information except to ask about it—that this Commission had reported, and that the Report at the present time was in the Foreign Office. I should like to ask two questions. I am sorry I could not give detailed information to the noble Earl on the subject of my questions, though I gave him what information I could this afternoon. I want to know, first of all, whether the Commission has reported, and secondly, what it has said, so far as it is open to the public (and I know of no reason why it should not be) on this question of extra-territoriality. It is quite clear to my mind that if this matter could be settled in a friendly way immediately a conciliatory spirit would arise, and all this friction, which has led to so much loss and interference with our trade interests, might be avoided.
Of course the ordinary idea is that if you do not have extra-territoriality you must have some system of Courts, with proper assessors, and probably a common Appeal Court, to which all foreigners may have access. I hope that kind of arrangement may be made. We know that there has been consolidation and codification in the Chinese law—I speak in the hearing of Lord Muir Mackenzie, who loves consolidation—with the idea of introducing principles of justice which are in accordance with our Western ideals. The Chinese claim that they are reasonable and that we are only legal. I am not going to enter into that different attitude of two different races. But, at any rate, an attempt has been made to codify the Chinese law in accordance with Western principles, and if that law could be administered under trustworthy Courts it appears to me that a large amount of the difficulty of dealing with the extra-territorial question might be avoided. I only throw that out as a method of adjustment and conciliation, as opposed to the continuance of a dispute which can do no good in itself, and which has undoubtedly led to the losses and the difficulties in our trade position to which I have already referred.
Upon that point I should like to add a word from the point of view of the missions. The missionaries are not only in the Treaty Ports, they are in all sorts of central and out-of-the-way places in Chine. What they say is that the time has come when, in order to prevent agitation—which, of course, is out of accord with all that missionary societies desire—these extra-territorial rights may, they hope, be exchanged for some such adjustment as I have suggested, by agreement and conciliation. I am sure the noble Earl, from his experience at the Foreign Office, is acquainted with the name of one of the most experienced of our missionaries in China, a man of wonderful ability and great knowledge of Chinese history, who has lived there for twenty-five years. I mean Dr. Henry Hodgkin, who has said this in a recent publication:—
"British and American missionary societies have expressed their desire—so far as they are concerned—that extra-territorial rights should be given up in exchange for agreed arrangements."
The agreed arrangements suggested are in the direction which I have indicated.

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Of course, I can only indicate the direction: it will be for the Government and for the noble Earl to say whether in that direction there is any prospect of a conciliatory settlement.
It happened to be only last Saturday that I met by accident a very near relative of the head of the great missionary college in China at Changsha (which is south of the Yangtze) who, by the by, has been at the head of that college for twenty-five years. He told me that the head of that missionary college entirely agreed with the view which I have quoted from Dr. Hodgkin, and that he, too, was convinced, from the experience which he had had over twenty-five years, that conciliation could best be got in the direction which I have indicated. I am aware that in making this suggestion I have not had the advantage of seeing the report, if the report has been made; but, in any event, I feel sure that the royal road to conciliation is in devising a new system, not inconsistent with the sovereign rights of China, which at the same time could give full protection to foreigners and foreign interests.
The next point is that of the Maritime Customs, which, I suppose, are really the same as tariffs. At the Washington Conference in 1922, and under the same paragraph of the Convention, or one very similar to it, the need of modification in the tariffs now in force was fully recognised, and a Commission was appointed with the idea that, although the tariff could not suddenly be changed, because of interference with industrial projects, yet in 1929 a revision could be made such as would meet the wishes of China. I am told, though I do not know of my own knowledge, that progress has been made, but that one of the difficulties facing you now, if you want to have conciliation as soon as possible, is not concerned with the ultimate revision of the tariff, but with the interim conditions as they are now. That, I am informed, is particularly one of the causes of friction in Canton and the surrounding district. If this matter could be removed from the area of friction to the area of conciliation I think great advance could undoubtedly be made.
Then there is one other matter which is generally referred to under the name of the rendition of the Mixed Court at Shanghai. This Court was established in
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1864 to try cases within the settlement, brought either by foreigners or Chinese, where the Chinese were the defendants. At this Court a foreign assessor must be present and no judgment of the Court could be given without the foreign assessor assenting. I believe that was found to be a system which gave the protection which was necessary. In the early days of the unsettlement of the Chinese Republic that Court fell through, or rather it was taken over by the foreign Consular body. I am told—and again I am speaking from information derived from persons who have resided for some time in China—that if that Court could be restored, if the claim for rendition could be received in a conciliatory manner it would have a great effect in creating a friendly feeling towards this country, especially in Canton. I know of no reason why the old Court should not be restored, but perhaps the noble Earl will give us some further information.
I am cognisant of the fact that I am putting to him a rather large number of questions; but I have endeavoured to do what I could to assist him in regard to the points to which I desire to draw your Lordships' attention. They are troublesome and difficult points, and they are technical points. But, after all, if you desire conciliation, if you desire the principle, which the noble Earl himself enunciated, of doing all we can to promote co-operation between this country on the one side and China on the other, it is in these directions that I think the growing consciousness of the Chinese national spirit might be met and their difficulties might be overcome.
Upon another matter I do not so much wish to ask a question as to make what, I think, is an obvious statement. I have already said that in my view it would be wholly wrong to support what is called denunciation until, after negotiation and conference, some other system for the protection of foreigners had been substituted. There was in The Times of yesterday a note which I think is in confirmation of the view I have expressed and hold very strongly against upsetting the extra-territorial arrangement until something can be put in its place. There is in that note a somewhat detailed statement of the view as to Treaty relations in the United States. It has the appearance

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of a communiqué from the State Department of the United States and points out regarding the Treaty between the United States and China that either party might give notice to terminate it after a period of years. It might give notice after ten years, and after another ten years, and so on; but at the present time notice could not be given because we were in the middle of one of these periods of ten years.
That shows that there is a difference between that and, for instance, the Belgian Treaty which has been so much discussed; because, so far as I have seen the terms of the Belgian Treaty, the right of denunciation, as it is called, although reserved to Belgium is not given to China. Matters of that kind, after all, are matters of difficulty, but they do not meet the real basis of the position. The real basis is conciliation and, apart from any technical question, if we want to have in the future, as our working classes ought to have it, the full advantage of an enormous trade, which there will be I think in a prosperous China, let us at this moment adopt not only the general policy which the noble Earl suggested, but let us try, in all the points as to which we know there is restriction and trouble and as to which we can understand the views of those who, perhaps, differ from us, to bring about by patience and conciliation what may be a permanent peaceful intercourse between the huge population of China on the one side and our industrial manufacturing country on the other. I have given Notice to move for Papers. It is a technical matter, no doubt, and it gave me the opportunity I desired of making observations on particular points. I do not suggest any particular Papers nor do I know what the Papers are, but I propose to move for Papers.
THE LORD PRESIDENT OF THE COUNCIL (THE EARL OF BALFOUR): My Lords, I certainly have no ground for complaint either against the substance of the noble Lord's speech or against its form. I think he was perfectly justified in raising the Question. He has raised it in a very conciliatory speech and if the advice he has given us does not go far, or indeed at all I think, beyond the general recommendation that we should do our best to smooth down any friction there may be in the relations between China and other Treaty Powers in general
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or ourselves in particular, still I am sure that nothing he has said can aggravate the difficulties of the present situation. If what he has said does not do much to remove them it at all events does not make them worse.
The noble Lord, of course, was perfectly right in telling us what none of us is likely to forget—how great are the interests which Great Britain has in the trade of China and the Far East. We have been pioneers in that trade. It has been carried on to the immense advantage of China as well as ourselves for a long period now, and we still, no doubt, have a most important share in that great traffic between East and West. It is, unfortunately, perfectly true also, as the noble Lord has pointed out, quoting from some reports which I do not happen to have seen but the general tenor of which is notorious, that in the recent period of disturbance we have probably been greater losers in proportion than other nations; but whether greater in proportion or not greater in proportion, at all events we have been losers on a very great scale.
If I had to complain of anything at all in the noble Lord's speech it would be that anybody listening to it without a previous knowledge of the circumstances would suppose that in some way or another this country had been pursuing a policy irritating to the Chinese, a policy which naturally resulted in friction and which had produced a state of things from which both China and ourselves were heavy losers. His constant use of the word "conciliation" appeared to suggest that we were as a nation, through our Foreign Office, pursuing a policy of which enlightened Chinamen and persons in China would have some right to complain. I hope that is not the case. The policy of this country, so far as I know, in the years which the noble Lord's speech covered has been uniformly in the direction of removing every legitimate grievance of which China could complain and of doing our best to meet every legitimate demand which Chinese patriots might reasonably make. That has been our policy and it remains our policy. It certainly was the policy of the Washington Conference of 1922 in which His Majesty's then Government took a very active and leading part.

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Undoubtedly one of the main causes of the difficulties with which we, Chinese and Western Powers alike, are confronted at the present moment is due to the fact that the recommendations of that Conference were not carried out with the speed which every member of that Conference anticipated after it came to its decision. I was one of the signatories of that Treaty and certainly nobody was more surprised than myself, or more unhappy, at finding that month followed month and year followed year without anything being done to carry out the proposals upon which the Powers at Washington had agreed. I need not go into the causes of that. The technical cause was, of course, that the Treaty, though agreed to, was not immediately ratified. Ratification was long delayed and until ratification had taken place—had taken place at the time mentioned in the Treaty itself—it was impossible to carry out the beneficent arrangements which the Treaty contemplated. My own personal opinion—I do not give it for more than that—is that much of the trouble in China has arisen from that cause and certainly His Majesty's Government had no hand or part in if and bear no responsibility for it. I do not know whether anybody was to blame. That is not a point on which it would be useful to dilate. But if anybody was to blame for it, it certainly was not His Majesty's Government.
There is one point which was certainly present to the mind of the noble Lord when he was speaking and is undoubtedly present to the minds of every one of Your Lordships who are now listening. It is that the difficulties with which we have to deal at the present time in China are not merely due to this unhappy delay in carrying out the reforms contemplated by the Washington Treaty but that they are still more dependent upon the state of China itself. So far as my knowledge goes nothing that has been done by any foreign Power in China, certainly nothing done by ourselves, is responsible for the state of chronic military civil war from which China is now suffering and which has such unfortunate reactions upon the trade, policy and commerce not only of the Chinese but of all other nations who have dealings with China. The noble Lord talked of conciliation. His Majesty's Government are most anxious, most desirous, that we should be on the most
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friendly terms with the great Chinese community, but the great Chinese community has no single representative with whom you can deal at the present moment.
We are apt to think—and are rightly apt to think—always of international relations in terms of settled international organisations. There is no settled organisation which has power in China at this moment. There is a Government whose authority nominally extends over the whole of the vast Empire, but everybody knows that though its power nominally extends over all that Empire its actual power, the reality of its influence, goes little beyond the walls of the capital where it resides, and that if you look for any substitute for that central and legitimate power all you can find are warring Generals carrying on military operations against each other with varying fortunes anti in directions which it is quite impossible for anybody to foresee. I do not think the Chinese themselves, even the best informed Chinese, even those most in the centre of affairs, could at this moment tell you how this internal contest is going to end, whether it is going to end (as end it must some day) in some kind of a fixed organisation, whether that organisation is going to be a united China or a disunited China, on what principles it is to be based and what form it will actually take when the time comes. And if no Chinese statesman can tell you that, it is vain for us, who live in the West, but imperfectly acquainted with that great and ancient civilisation—it is impossible for us to prophesy where local prophets are no longer to be trusted.
If that be the state of China, which nobody is likely to deny, how is it possible to carry out effectively that policy of conciliation which in terms we are all so passionately desirous of seeing made effective? Whom are you to conciliate? One of the difficulties is that if you make any arrangement with regard to the Customs Duties, for example, which is agreeable to one of these warring chiefs you will probably offend the other warring chiefs. The money which comes from the Customs does not necessarily, does not probably, go to the Central Government: it goes to one or other of these contending units, and of course any General who does not get money from the Customs has a strong objection to any

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other General getting money from the Customs in which he has no share. That is only one form which the difficulty takes. Disorder reigns in many parts of China and of that disorder foreign subjects are frequently the victims. To whom are you to apply for redress? If you apply to the leaders of the legitimate authority at Peking they may give you premises, but it is entirely out of their power to see that those promises are performed. Are you then to start negotiations with separate Generals? That, no doubt, is absolutely necessary in many cases, but you can hardly lay it down as a principle. The noble Lord in his speech, in so far as he put this aspect of the case, kept it in the background, not for any controversial purposes, but from the course of his speech, and the very fact that he kept this entirely abnormal state of things in the background is apt to give a wrong impression both of his own views on the subject and of the lines on which public affairs and international relations are being carried on in the East.
I should like to answer some of the specific questions that the noble Lord put to me. He asked me about extra-territoriality, especially in connection with the Shanghai Court. I think it was connected with that, was it not?
LORD PARMOOR: Yes, it was connected.
THE EARL OF BALFOUR: As regards the Shanghai Court I may tell him at once what I am sure he will be pleased to hear: that, as I understand it, the policy he recommends has already been adopted. A local agreement has been signed recently at Shanghai for the rendition of the Mixed Court, of which he gave us an account, which is satisfactory both to the Chinese and to the foreigners and has been approved by the Diplomatic Body. I understand that there are some details still to be arranged but that, broadly speaking, the general line of policy which he has laid before your Lordships is one which has already been successfully adopted. He asked me a question about the Commission on extra-territoriality. He is quite right in saying that the Commission has reported but we have not yet received the Report. He was under the impression. I think, that it had reached the Foreign Office.
LORD PARMOOR: I was.
THE EARL OF BALFOUR: It is on its way, but I am given to understand that it has not yet reached the Foreign Office. I cannot tell him anything about its contents except this, that I believe the arrangement recommended by that Commission has been unanimously recommended both by the Chinese and by the foreign members of the Commission. That appears to be a most satisfactory state of things, but I need hardly say I am unwilling to commit myself further until I know more. But as far as it goes the information on that point is thoroughly satisfactory.
If I turn to tariff revision, I entirely agree with the noble Lord in saying that unquestionably the existing tariff system is one which ought not to be maintained in its integrity. Indeed, as he knows, and as all your Lordships know, the Washington Treaty in terms suggested great reforms which, had things gone more smoothly, by which I really mean had the Treaty been ratified, I believe would now be in force.
LORD PARMOOR: May I ask one question? Was that, apart from the Commission, in the Treaty itself?
THR EARL OF BALFOUR: There may be some misunderstanding between the noble Lord and myself. Was he not referring to the International Commission set up at Peking under the Treaty of Washington?
LORD PARMOOR: Yes, I was.
THE EARL OF BALFOUR: Had the Treaty of Washington been ratified when everybody had a hope that it would be ratified and at a date when it could be ratified that Commission would long ago have reported, and long ago, I believe, the changes in the tariff recommended by the Washington Treaty would have been carried into effect. Unfortunately that did not take place. It did not take place, as I have already explained to your Lordships, because the Treaty was not ratified, and when the ratification actually occurred, and when the Powers at Peking set to work upon the subject, at that very moment China fell into the chaotic condition which at the present moment not only produces confusion in China itself but

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makes all international relations between China and the Powers of extraordinary difficulty and indeed in many respects quite impossible. How can the Commission sit and work in the circumstances prevailing in China at this moment? There is no such entity for purposes of negotiation as an undivided China. That is, no doubt, a temporary state of things, but it is a state of things which, while it lasts, makes the work of the Commission really a hopeless task. All you can do in carrying out these reforms is to wait for better times. I do not know that there is any other question which the noble Lord put.
LORD PARMOOR: May I remind the noble Earl that I asked whether the report of the success of the Cantonese Army was justified?
THE EARL OF BALFOUR: The noble Lord is quite right. He did put that question to me. I understand that in the changing circumstances of Chinese political military policy the Cantonese are still advancing. We have no information which would lead us to form any conclusion worth considering as to the limits of their advance, but they are still advancing and they are still, as far as I understand the matter, successful in the field. That I think concludes all the questions which the noble Lord has put to me. I need only say at the end of my observations what I have endeavoured to indicate on various points while I was making them, that there is nothing this country desires more in the interests of China and in the interests of Great Britain than that there should be good feeling between the two communities. We also hold quite clearly and distinctly that the Chinese have just reason for their disappointment at the delays which have occurred in carrying out the recommendations of the Treaty of Washington.
We also agree that there are reforms which may be carried out, and should be carried out, for mitigating ally abuses which may have and probably almost certainly have sprung up in the course of years. The last thing that we desire to do is to suggest the idea that we hold any position or desire to hold any illegitimate position of superiority in connection with the affairs of China, or the commerce of China, or its internal organisation, or its progress, or
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its ideals. I cannot believe that if there was any frank conversation between a representative of China and a representative of Great Britain there would be found any differences of principle at all. There is no doubt that China benefits immensely by its Western commerce. There is no doubt that the West benefits immensely by its Eastern commerce. There is no doubt that, probably for some little time to come, there may have to be special arrangements, which may not interfere with the dignity of China, nor with its autonomous development, certainly not with its exterior relations—but arrangements of a somewhat exceptional character may still have to remain. That should be a matter easily arranged between the Chinese themselves and ourselves.
All those who know them tell me that they are people who have a great deal of good sense, a great power of seeing facts as they are, great gifts of character and intellect. I do not believe there ought to be any difficulty, if circumstances only favour our relations, in carrying out what the noble Lord called a policy of conciliation but which really is no more than carrying out what we have long desired to carry out—namely, to have all our relations with China on the friendliest footing. I do not see how any satisfactory policy can be carried out, either by ourselves or by any Western Power or by all the Western Powers acting together, until China has more or less set her own house in order. It is for her to determine how that house is to be set in order, and it is for her to bring the present situation to an end and to bring it to an end in conformity with the wishes of the Chinese. We have not the slightest intention of interfering, nor the slightest desire to interfere nor, indeed, the slightest power to interfere with any decision that the Chinese may come to with regard to the organisation of China, but until China is organised in some way or another it is vain to hope that the relations between that vast population and the rest of the world can be put on that thoroughly satisfactory footing which can alone bring a permanent end of the difficulties that now perplex statesmen both of the East and of the West.
LORD PARMOOR: My Lords, I rise only to thank the noble Earl most gratefully for the answer that he has given

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to the Question that I asked him. I think it is quite clear that, if future negotiations are conducted in the spirit disclosed by the speech of the noble Earl, the difficulties in connection with the Chinese question that are so often referred to should to a very large extent be eliminated. It may be quite true that, in addressing your Lordships from a particular point of view, I did not stress the difficulties that exist in China itself. I recollect that on the last occasion the noble Earl, in language that was most instructive in the higher sense—I am not saying this in any critical sense—explained to us what the difficulties were as regards the internal conditions of China. I agree that they have to be left to the Chinese, but I think that, if
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the Chinese are aware of the spirit of conciliation as a basis of British policy, as indicated by the noble Earl, this in itself will be of assistance to them because, in their own internal quarrels, they have had a certain suspicion regarding foreign influence which they ought not to have, judging by the speech which the noble Earl has made. I do not wish to repeat matters that have already been gone over and in conclusion I will only say that I have no desire, after the information that the noble Earl has given us, to press for Papers.
Motion for Papers, by leave, withdrawn.
House adjourned at a quarter before five o'clock.