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Senator BRANDEGEE. You spoke yesterday, I think of China having signed the treaty under protest?

Mr. FERGUSON. Yes, sir.

Senator BRANDEGEE. What was the character of her protest and when was it made?

Mr. FERGUSON. The protest was made at the conference when the ultimatum was given, and after the whole thing was practically decided on the part of Japan, and no further yielding after April 26. There was parleying for several days, and naval preparations and military preparations by Japan, ending with the presentation of the ultimatum of May 7. During all that time there were parleyings, but there was no change in what was decided upon at that time, and during the progress of the negotiations previous to April 26, on two distinct occasions the Japanese threatened that if their requests were not agreed to, the promise to restore Kiaochow would be withdrawn.

Senator BRANDEGEE. That was a threat to break the treaty, was it not?

Mr. FERGUSON. Yes, sir.

Senator BRANDEGEE. Of course none of these protests on the part of China which you say were made at the conference prior to the actual signature of the treaty were in writing, were they?

Mr. FERGUSON. No, sir; but they were all later put in writing and there was issued an "Official statement by the Chinese Government respecting the Chino-Japanese negotiations now brought to a conclusion by China's compliance with the terms of Japan's ultimatum delivered on May 7, 1915."

That was communicated duly to all the various legations in Peking. Senator BRANDEGEE. In what publication does that appear? Have you it in the pamphlet before you?

Mr. FERGUSON. I have it.

Senator BRANDEGEE. What is the title?
Mr. FERGUSON. It is appendices.

Senator BRANDEGEE. It is appendices of what?

Mr. FERGUSON. Appendices of Mr. Millard's book on the far eastern question. I have also an official copy in my notes.

Senator BRANDEGEE. I wish you would put that written protest or statment that China issued in relation to this treaty into the record, if you please. How long is it--not the whole appendix, but the protest?

Mr. FERGUSON. The whole statement covers 15 pages.

Senator BRANDEGEE. That is China's statement of the whole case? Mr. FERGUSON. That is China's statement of the whole case. Senator BRANDEGEE. I would like to have that put into the record, if there is no objection.

(The statement referred to is here printed in full as follows:)

OFFICIAL STATEMENT BY THE CHINESE GOVERNMENT RESPECTING THE SINO-JAPANESE NEGOTIATIONS NOW BROUGHT TO A CONCLUSION BY CHINA'S COMPLIANCE WITH THE TERMS OF JAPAN'S ULTIMATUM DELIVERED ON MAY 7, 1915.

At 3 o'clock on the afternoon of May 7, 1915, his excellency the Japanese minister in Peking delivered to the Chinese Government in person an ultimatum from the Imperial Japanese Government, with an accompanying note of seven articles. The concluding sentences of the ultimatum read thus:

"The Imperial Government hereby again offer their advice and hope that the Chinese Government, upon this advice, will give a satisfactory reply by 6 o'clock p. m. on the 9th day of May. It is hereby declared that if no satisfactory reply is received before or at the specified time the Imperial Government will take such steps as they may deem necessary."

The Chinese Government, having received and accepted the ultimatum, feel constrained to make a frank and plain statement of the facts connected with the negotiations which were abruptly terminated by this drastic action on the part of Japan. The Chinese Government have constantly aimed, as they still aim, at consolidating the friendship existing between China and Japan, and, in this period of travail in other parts of the world, have been particularly solicitous of preserving peace in the Far East. Unexpectedly on January 18, 1915, his excellency the Japanese minister in Peking, in pursuance of instrutions from his Government, adopted the unusual procedure of presenting to his excellency the President of the Republic of China a list (hereto appended) of 21 momentous demands, arranged in five groups. The first four groups were each introduced by a preamble, but there was no preamble or explanation to the fifth group. In respect of the character of the demands in this group, however, no difference was indicated in the document between them and those embodied in the preceding groups.

Although there was no cause for such a démarche, the Chinese Government, in deference to the wishes of the Imperial Japanese Government, at once agreed to open negotiations on those articles which it was possible for China to consider, notwith standing that it was palpable that the whole of the demands were intended to extend the rights and interests of Japan without securing a quid pro quo of any kind for China. China approached the pending conferences in a spirit of utmost friendliness and with a determination to deal with all questions frankly and sincerely. Before negoti ations were actually commenced, the Japanese minister raised many questions with regard to the number of delegates proposed to represent China, the number of conferences to be held in each week, and the method of discussion. The Chinese Government, though their views differed from those of the Japanese minister, yielded in all these respects to his contentions in the hope of avoiding any delay in the negotiations. The objections of the Japanese minister to the customary recording and signing of the minutes of each conference, which the Chinese Government suggested as a necessary and advisable precaution, as well as one calculated to facilitate future reference. were also accepted. Nor did the Chinese Government retaliate in any way when in the course of the negotiations the Japanese Minister twice suspended the conferences. obviously with the object of compelling compliance with his views on certain points at the time under discussion. Even when delay was threatened owing to the unfortunate injury sustained by the Japanese Minister as a result of a fall from his horse. the Chinese delegates, in order to avert interruption, proposed that the conferences should be continued at the Japanese Legation, which proposal was accepted. Later when, on March 22, the Japanese Government dispatched large bodies of troops to South Manchuria and Shantung for the ostensible purpose of relieving the garrisonwhose term of service had not then expired-the Japanese Minister stated at the conference, in reply to a direct question as to when the retiring troops would be withdrawn, that this would not be done until negotiations could be brought to a satisfactory conclusion. Although this minatory step caused much excitement, indignation, and alarm on the part of the Chinese people, and made it difficult for the Chinese Government to continue the conferences, they successfully exerted efforts to avert a rupture and thus enabled the negotiations smoothly to proceed. All this demonstrates that the Chinese Government were dominated by a sincere desire to expedite the progres of the conferences; and that the Japanese Government recognized this important fact was made clear on March 11 when the Japanese Minister conveyed to the Chinese Government an expression of his Government's appreciation of China's frankness and sincerity in the conduct of the negotiations.

One of the supplementary proposals was in these terms:

From February 2, when the negotiations were commenced, to April 17, 24 conierences were held in all. Throughout this whole period the Chinese Government steadfastly strove to arrive at an amicable settlement and made every concession possible.

Of the 21 demands originally submitted by Japan, China agreed to 15, some in principle and some textually, 6 being initialed by both parties.

IN THE MATTER OF THE DEMANDS TO WHICH CHINA AGREED.

At the first conference, held on February 2, China agreed in principle to the first article of the Shantung group of demands which provides that China should give her assent to the transfer of Germany's rights in Shantung to Japan. The Chinese Governe ment maintained at first that the subject of this demand related to the post bell.m

settlement, and therefore should be left over for discussion by all the parties interested at the peare conference. Failing to persuade the Japanese minister to accept this view, the Chinese Government agreed to this demand in principle, and made certain supplementary proposals.

"The Japanese Government declares that when the Chinese Government give their assent to the disposition of interests above referred to, Japan will restore the leased territory of Kiaochow to China, and further recognizes the right of the Chinese Government to participate in the negotiations referred to above between Japan and Germany."

The provision for a declaration to restore Kiaochow, was clearly not a demand on Japan but only a reiteration of Japan's voluntary statement in her ultimatum to Germany on August 15, 1914 (a copy of which was officially transmitted to the Chinese Government for perusal on August 15), and repeated in public statements by the Japanese premier. Appreciating the earnest desire of Japan to maintain the peace of the Far East and to cement her friendship with China, as evidenced by this friendly offer, the Chinese Government left the entire question of the conditions of restoration to be determined by Japan, and refrained from making any reference thereto in the supplementary proposal. The suggestion relating to participation in the conference between Japan and Germany was made in view of the fact that Shantung, the object of future negotiation between Japan and Germany, is a Chinese Province, and therefore China is the power most concerned in the future of that territory.

Another supplementary proposal suggesting the assumption by Japan of responsibility for indemnification of the losses arising out of the military operations by Japan in and about the leased territory of Kiaochow was necessitated by the fact that China was neutral vis-à-vis the war between Japan and Germany. Had China not inserted such a provision, her position in relation to this conflict might have been liable to misconstruction-the localities in which the operations took place being a portion of China's territory and might also have exposed herself to a claim for indemnification of losses for which she was in no way responsible.

In a further supplementary proposal the Chinese Government suggested that, prior to the restoration of the Kiaochow territory to China, the maritime customs, the telegraphs, and post offices should continue to be administered as heretofore; that the military railway, the telegraph lines, etc., which were installed by Japan to facilitate her military operations, should be removed forthwith; that the Japanese troops now stationed outside of the leased territory should be first withdrawn, and those within the teritory should be recalled at the time when Kiaochow is returned to China. Shantung being a Chinese Province, it was natural for China to be anxious concerning the restoration of the status quo ante bellum. Although the Chinese Government were confident that the Japanese Government would effect such restoration in pursuance of their official declaration, it was necessary for China, being neutral throughout the war, to place these matters on record.

At the third conference, held on February 22, China agreed to the second demand in the Shantung Group not to cede or lease to any power any territory or island on the sea border of Shantung.

At the fifth conference, held on February 29, China agreed to give Japan the preference, provided Germany abandoned the privilege to supply the capital for the construction of a railway from Chefoo or Lungkow to connect with the Kiaochow-Tsinanfu Railway, in the event of China deciding to build that railway with foreign capital. At the sixth conference, held on March 3, China, in the interests of foreign trade, agreed to open certain important cities in Shantung as trade marts under regulations approved by the Japanese Government, although this was a demand on the part of Japan for privileges additional to any that hitherto had been enjoyed by Germany and was not an outcome of the hostilities between Japan and Germany, nor, in the opinion of the Chinese Government, was its acceptance essential to the preservation of peace in the Far East.

At the eighth conference, held on March 9, China agreed (1) to the extension of the term of the lease of Dairen and (2) Port Arthur, and (3) of the South Manchuria and (4) Antung-Mukden Railways, all to 99 years.

Owing to the bitter experiences which China sustained in the past in connection with the leased portions of her territory, it has become her settled policy not to grant further leases nor to extend the term of those now in existance. Therefore, it was a significant indication of China's desire to meet Japan's wishes when she agreed to this exceptional departure from her settled policy.

At the same conference the Chinese Government also agreed to refrain from raising objections to the principle of cooperation in the Hanyehping Co., if the latter should arrive at an agreement in this respect with the Japanese capitalists concerned. With reference to this question it was pointed out to the Japanese Minister that, in the

provisional constitution of the Republic of China, Chinese subjects are guaranteed the right of protection of their property and freedom to engage in any lawful occupation The Government was precluded, therefore, from interfering with the private busines of the people, and could not find any other solution than the one thus agreed to.

As regards the single article of the fourth group, and the preamble thereto, the Chinese Government held that they were inconsistent with Chinese sovereignty However, China, at this conference, expressed her readiness to meet the wishes of Japan so far as it was possible without infringing her sovereignty, and agreed to make a voluntary pronouncement that she would not alienate any portion of her coast line. In connection with the South Manchuria Railway it is worthy of note that the provision regarding the repurchase period in the agreement (36 years from 1902) was not mentioned in Japan's original proposal. Subsequently the Japanese Government on the ground that the meaning of this provision was not clear, requested China to agree to its cancellation. To this request the Chinese Government acceded, thongh well aware that the proposed change could only benefit Japan. China thus relinquished the right to repurchase the railway at the expiration of another 23 years.

In connection with the Antung-Mukden Railway, the article, which was originally initialed at the conference, provided for the reversion of the railway to China at the end of 99 years without payment, but, at the subsequent meeting, the Japanese Minister requested that the reference to the reversion without payment de deleted from the initialed article. In acceding to the Japanese minister's request, China again showed her sincere desire to expedite matters and to meet Japan's wishes even at the sacrifice of a point in her favor, to which Japan had already agreed.

At the eleventh conference, held on March 16, China agreed to give Japan preference in regard to loans for railway construction in South Manchuria.

At the thirteenth conference, held on March 23, China agreed (1) to the amendment of the Kirin-Changchun Railway loan agreement; (2) to give preference to Japan if the revenue of South Manchuria were offered as security for loans; (3) to give preference to Japanese in the event of the employment of advisers for South Manchuria: (4) to grant to Japanese the right of mining in nine specified areas in South Manchuria.

In its original form the demand with reference to mining in South Manchuria tended to create a monopoly for Japanese subjects, and, therefore, was entirely inconsistent with the principle of equal opportunity. The Chinese Government explained that they could not, in view of the treaty rights of other powers, agree to this monopoly but they readily gave their acceptance when Japan consented to the modification of the demand so as to mitigate its monopolistic character.

In connection with the Kirin-Changchun Railway, the amendment agreed to involves a fundamental revision of the original agreement on the basis of the existing railway loan contracts concluded by China with other foreign capitalists, as well as an engagement on the part of the Chinese Government to extend to this railway any better terms which may be hereafter accorded to other railway concessionaries in China. The capital of this railway was originally 50 per cent Chinese and 50 per cent Japanese The effect of this undertaking is to transfer the capital originally held by the Chinese as well as the full control and administration of the railway, to the Japanese

At the twenty-first conference, held on April 10, China agreed, in regard to the demands concerning Fukien province, to give Japan an assurance in accordance with Japan's wishes at a future time.

As regards demands 2 and 3 in the Manchuria Group, relating to the ownership of land for trade, manufacture, and agricultural enterprises, as well as for the right of settlement in the interior of South Manchuria, the Chinese Government, after discussion at several conferences, agreed to them in principle, but desired to introduce certait, amendments concerning the control and protection of the Japanese subjects who might avail themselves of these rights. The course of the negotiations in connection with these amendments will be referred to subsequently.

IN THE MATTER OF THOSE DEMANDS TO WHICH CHINA COULD NOT AGREE

Of the 21 original demands there were 6, as previously mentioned, to which China could not agree on the ground that they were not proper subjects for international negotiation, conflicting as they did with the sovereign rights of China, the treaty richte of other powers, and the principle of equal opportunity.

Thus, for example, the second article of the Hanyehping question in the origin. third group in particular seriously affected the principle of equal commercial opter tunity.

The proposal that there should be joint administration by China and Japan of the police in China was clearly an interference with the Republic's domestic affairs, and consequently an infringement of her sovereignty. For that reason the Chinese Goverte ment could not take the demand into consideration. But when it was explained in

the Japanese minister that this referred only to South Manchuria, and he suggested that his Government would be satisfied if China agreed to engage Japanese as police advisers for that territory, the Chinese Government accepted the suggestion.

The two articles relating to the acquisition of land for schools, hospitals, and temples, as well as to the right of missionary propaganda, would, in the opinion of the Chinese Government, have presented grave obstacles to the consolidation of the friendly feeling subsisting between the two people. The religions of the two countries are identical and, therefore, the need for a missionary propaganda to be carried on in China by Japanese does not exist. The natural rivalry between Chinese and Japanese followers of the same faith would tend to create incessant disputes and friction. Whereas western missionaries live apart from the Chinese communities among which they labor. Japanese monks would live with the Chinese; and the similarity of their physical characteristics, their religious garb, and their habits of life would render it impossible to distinguish them for purposes of affording the protection which the Japanese Government would require should be extended to them under the system of extra-territoriality now obtaining in China. Moreover a general apprehension exists among the Chinese people that these peculiar conditions favoring conspiracies for political purposes might be taken advantage of by some unscrupulous Chinese.

The demand for railway concessions in the Yangtze Valley conflicted with the Shanghai-Hangchow-Ningpo Railway agreement of March 6, 1908, the NankingChangsha Railway agreement of March 31, 1914, and the engagement of August 24, 1914, giving preference to British firms for the projected line from Nanchang to Chaochowfu. For this reason the Chinese Government found themselves unable to consider the demand, though the Japanese minister, while informed of China's engagements with Great Britain, repeatedly pressed for its acceptance.

In respect to the demand for the appointment of influential Japanese to be advisers and instructors in political, financial, and military affairs, the policy of the Chinese Government in regard to the appointment of advisers has been similar to that which has presumably guided the Japanese Government in like selection of the best qualified men irrespective of their nationality. As an indication of their desire to avail themselves of the services of eminent Japanese, one of the earliest appointments made to an advisership was that of Dr. Ariga, while later on Dr. Hirai and Mr. Nakayami were appointed to the ministry of communications.

It was considered that the demand that Japanese should be appointed in the three most important administrative departments, as well as the demand for the joint control of China's police, and the demand for an engagement to purchase a fixed amount of arms and ammunition from Japan or to establish joint arsenals in China, so clearly involved the sovereignty of the Republic that the Chinese Government were unable

even to consider them.

For these reasons the Chinese Government, at the very outset of the negotiations, declared that they were unable to negotiate on the demands; but, in deference to the wishes of the Japanese Minister, the Chinese delegates consented to give the reasons for declining to enter into a discussion of them.

IN THE MATTER OF THE QUESTIONS OF DISPUTE INVOLVED IN SOME OF THE FOREGOING DEMANDS.

The demand by Japan for the right of her subjects in South Manchuria to lease or own land, and to reside and travel, and to engage in business or manufacture of any kind whatever, was deemed by the Chinese Government to obtain for Japanese subjects in this region a privileged status beyond the terms of the treaties existing between the two nations, and to give them a freedom of action which would be a restriction of China's sovereignty and a serious infringement of her administrative rights. Should Japanese subjects be granted the right of owning land, it would mean that all the landed property in the region might fall into their hands, thereby endangering China's territorial integrity. Moreover, residence in the interior was incompatible with the existence of extra-territoriality, the relinquishment of which is necessary to the actual enjoyment of the privilege of inland residence, as evidenced in the practice of other nations.

Japan's unconditional demand for the privilege of inland residence accompanied with a desire to extend extra-territoriality into the interior of China and to enable Japanese subjects to monopolize all the interests in South Manchuria, was also palpably irreconcilable with the principle of equal opportunity. For this reason the Chinese Government were, in the first instance, unable to accept this demand as a basis of negotiation. Their profound regard for the friendly relations of the two countries, however, persuaded them to exert their utmost efforts, in spite of all the inherent difficulties, to seek a solution of a question which was practically impossible

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