The San Francisco call., 1905-08-18

ment and Russia. Russia has agreed to
surrender the road TO China and give up
her concession obtained in 1898, but China
must assent, and assent means she must
agree TO remunerate the Russian Gov
ernment which guaranteed the bonds for
the building of the road. in an amount
hereafter to be determined. Japan also
has her claim for the rebuilding of the
road destroyed by the Russian army. the
reconstruction of bridges and change of
gauge. The matter remains primarily to
be adjusted by Japan and China and IL is
not unlikely that the Toxic Government
is already in communication with the
Peking Government on the subject.
AWAITING ANSWER.
The long dispatches sent by Baron Ko-
mura to his Government on this subject
after yesterdays session which were not
all on until o'clock this morning makes
this probable. Possibly an answer from
China is essential to final agreement upon
article and this may be the true rea-
son for the postponement after accord
In principle" had been reached. China's
wish 10 be consulted concerning articles
Of the treaty affecting her territory must
be respected in this particular at least
China may not care to assume the fnan-
cial burden involved in taking over the
road She certainly could not raise the
money without hypoth-cating the prop
erty. II Japan is convinced that the road
will eventually become paying CONNER
cial venture she might, herself, advance
the money or 1t might be raised for China
by an International syndicate and become
part OF the system of Chinese imperial
railroads. II not, Japan may, and prob
ably would for the present, step into Rus
sia's shoes, although she has solemnly
promised China to restore Manchuria and
TO retain the railroad would be to retain
strategical control of the province
The amount Russia will realize is i'm
possible TO estimate. It will undoubtedly
be only comparatively small fraction
Of the sum poured into it, BY the terms
Of the concession China had the privilege
of taking over the road at the end of
thirty-six years upon the repayment of
capital, construction and deficit charges.
Japan recognized that Russia was en-
titled to some remuneration. But this
basis is not known. The Russian claim
was founded on the principle of inter
national law that a belligerent occupying
territory can exercise the right of
usufruct Of private property during occu-
patton, but cannot confiscate as a spoil
of war. Mr.. Witte, in whose brain was
born the conception of the Chinese East
ern Railroad. was particularly competent
TO defend the rights of the company,
which Russia claims is distinctly a pri-
vate corporation. although making no
concealment of the fact that IT was back
ed by the Russian Government because
Of political considerations. The original
concession obtained in 1899 for the Chi
nese Eastern Railway, then simply the
cutoff" through northern Manchuria,
was obtained by the late Mr.. Rothstein,
director of the Russo-Chinese Bank. and
Prince Okutomsky. and the company was
formed for the construction of the road
In 1895, after the lease of Port Arthur
and Talienwan Oalny) was obtained
from China, the concession for the south
ern branch was negotiated. 1t provided
for a Chinese president of the road, and
Shing Kuchin, who had been the Chinese
Minister In st. Petersburg, was presi-
dent until he fell victim TO the anti
foreign Boxer uprising In 1900
The bonds issued with the Government
guarantee were sold like Government
four per cent rentes and are now in the
hands OF the banks and general public
like regular Government obligations AL
though the loss on operation has been
heavy, the Russo-Chinese Bank always
believed IL would become a remunerative
concern One Of the big extraordinary
items Of expense was the necessity of
maintaining railroad guards. The south
ern branch. which now goes to China.
gave especial promise of being very
profitable.