New-York tribune., 1908-03-16
JAPAN NEEDS MONEY.
I FOREIGN AID POSSIBLE.
Government Control Of Rml7cays
lHau Be abandoned


Toxic. March 15-The government of Japan
finding that the self-imposed burden Of govern
rnent control of railroads is likely to prove 100
heavy. is engaged in considering plans 10
relieve itself and at the same time build up the
industries of the country. providing additional
exports for it's subsidized steamship lines and
increasing its own income by the revenues de-
rivable from increased production Nothing
presents so difficult problem at the present
time that of high finance in Japan
The tremendous outlay on the army and navy
has beer and continues TO be the point on which
statesmen politicians and financiers are quar-
relIing With Sc per cent of its appropriations
given to the three divisinns-fnance, army and
navy-Iitte is left for the so greatly needed i'm
provement Of railroads. and In the present con-
dition of the country the four hundred millions
which must be paid the old railroad COM
panies will strain the ingenuity of the hnanciers
who have undertaken the reorganization.
Meanwhile little can be done to extend track
age throughout the sections of Japan where IL
is needed for development and to improve and
equip the present lines so as to enable them 10
meet the demands CT traffic. It is realized by
commercial men who opposed government
ownership of the railroads at the time the ques-
tion came up and by those who favored the
movement but have since changed their views
it is impossible to develop its resources. and
that consequently it is impossible for the gov
ernment TO adjust its finances so that in future
years its income may meet its necessary and
legitimate expenditures.
PLAN TO LEASE LINES TO SYNDICATE.
Ffnanciers, engineers and railroad men from
foreign countries have been in conference for
the last month and more with leading men in
Japan. II is understood that the proposal now
finding favor is that the railroads of Japan
should be leased for period of years to pri
vate company syndicate which would remove
from the ia panese government the financial bur-
den and responsibility which 1t has undertaken,
and would pay to the government certain per-
centage of profits and undertake Improvements
and extensions under a given schedule This
plan may be said to have assumed a somewhat
concrete form, and European financiers have eX-
pressed their Willingness under certain condi-
tons to undertake the work. II IS pointed out
that when the government of Italy assumed con-
troll OF the railroads. many years ago. it discov
cred like Japan, that the undertaking was likely
to hamper the normal movement of the country s
finances. and d plan somewhat similar TO that
now under consideration here was adopted with
great success 1t is doubtful. however, if any
thing more definite along these lines will be
made public until after the coming general
election.
| The influence which has prompted Japan to
take into consideration this question of the
future management of the railroads is said to
be the fact that. in view of the financial neces-
sites of the coming twelve mopths, JtuanCiers
believed that a foreign loan inevitable,
| and the foreign markets were sounded 1t then
developed that Europe and America regarded
the naval and military policies of Japan. which.
1t was thought, indicated expectation OF trouble,
7 To-
amounts In the foreign field In other words,
| Japan was told that money would not be forth
| coming to build up an army and navy beyond
such standard il was reasonable to expect
Japan to maintain, and that the financial world
would prefer TO Japan earnestly developing
| her resources for the betterment OF her people
rather than taxing those people for army and
navy which might be used for aggression.
! POWERS DESIRE A GUARANTEE.
The reply of the Japanese government to this
| seems TO have been that the future financial
| programme contemplated large reduction OF
expenditures on the army and navy, but those
who were in a position to lend money apparently
rejoined that they would prefer guarantee re-
garding the expenditure of the money loaned,
and added that In common with so many people
in japan, they thought the government owner
ship of railroads as great mistake too rapid
and ambitious plans Tor army ana navy ueNtiop-
ment.
| The proposal therefore, which the government
of Japan is considering is that syndicate
of European financiers assist Japan in working
ont the financial problem of the future, provided
= the Japanese government agrees that this hnan-
cial relief shall be applied TO the improvement
of her railroad systems and for internal de-
! yelopments.
The scheme is a large one. but there is a
belief that the syndicate is serious in making
the proposal, and believes that only under such
a plan can foreign capital to the extent of
80 900 900 yen more be induced TO regard
favorably the investment of money in japanese
securities.