§ Sir J. Wardlaw-Milneasked the Prime Minister whether he can state the position of the negotiations with the Chinese Government in respect of the payment of the interest on the loans secured on the Customs and salt revenue and the railway loans; whether he can inform the House of the nature of the offer made by the Chinese Government, and, if the offer was not accepted, the reasons for refusing to accept it, also if the bondholders affected were ever consulted in the matter?
§ Mr. Butler:An offer by the Chinese Government to pay part of the interest on their loans secured on the Customs and salt revenues was received in March last and referred for consideration to the committee appointed by the Bank of England to represent the bondholders.
Negotiations ensued, and in June the committee informed the Chinese Government that the offer, into which certain important changes had been introduced, was such as they could recommend the bondholders to accept. In July, owing to the difficulties caused by the fall in value of the Chinese dollar, the offer was withdrawn.
As regards the railway loans, the attitude of the Chinese Government is that they cannot continue to accept responsibility for financial obligations secured on railways over which they no longer exercise control or from which they draw no revenue.