The San Francisco call., 1908-03-16
JAPAN WANTS TO
RENT RAILROADS
Unable to Borrow Huge Sums
Needed, Empire Considers
European Syndicate's Offer
MiIitarism Hurts Credit and
Government Lines Must Be
Leased for Revenue

TOKYO, March 15.-The government
OF Japan, finding that the imposed
burden of national railroads is likely
to prove too heavy. Is now engaged in
consideration of tentative projects for
relieving itself and at the same time
serving the double purpose of building
up the industries OF the country, pro-
viding additional exports for its sub
sidized steamship lines and increasing s
It's own income by the revenue to be
derived from Increased production.
To the layman nothing presents so
difficult problem at the present time
rs that of high finance in Japan. The
tremendous outlay on army and navy
has been and still continues to be the
point on which statesmen, politicians
and financiers are quarreling. With 6S
per cent of its appropriations given to
the three diyisions-finance army and
navy-but little necessarily is left for
the much needed improvement of the
railroads, and in the present condition
of the country the s400.000,000 that
must be paid to the old railroad COM
panies for the purpose will strain the
ingenuity of the financiers who have
undertaken the reorganization. Mean
while but little can be done to extend
the trackage throughout those sections
of Japan where it is much needed for
development.
SYNDICATE WILLING
1t is in this connection that hnan-
ciers, engineers and railroadmen from
foreign countries have been in confer
ence for the last month with leading
men in Japan. 1t is understood that
the proposition now finding favor is
that the railroads OF Japan should be
leased for q period of years to a pri-
vate company or syndicate which will
pay the government a certain percent
age of profits and will undertake i'm
provements and extensions under a
given schedule.
The plans in this connection are at
present entirely tentative, but it may
be stated that they have assumed a
concrete form and that, under certain
conditions, European inanciers have
expressed their willingness to under
take the work.
The influence that undoubtedly has
prompted Japan to at least take into
consider ltfon this question of the fu
ture conduct of the railroads is stated
to be the fact that. in view of the finan-
cial necessities Of the coming year,
financiers believed that foreign loan
was inevitable, and that when the for
eign markets were sounded it devel-
oped that Europe and America regarded
pan as fatal to Japan's credit. In other
words, Japan has been told that money
will not be forthcoming for the build
ing up of an army and navy beyond
such standard as it is reasonable to ex-
pect Japan to maintain, and that the
financial world would prefer to see ia
pan really and in earnest developing e
her resources for the betterment of her
people than taxing those people for an
army and navy which, rightly or
wrongly, are said to be destined for ag
gression sooner or later
MILLIONS ARE NEEDED
The outlined proposition therefore to
which the government of Japan has
lent an ear and which it is now consid-
ering is that syndicate of European
financiers will assist Japan in working
out the financial problem of the future,
provided the Japanese government is
content that this financial relief shall
be applied to the betterment of its rail-
road system and for internal develop
ment.
The project is large, but there is an
indication that the syndicate is serious
in making the proposition and believes
that only under such plan can for
eign capitalists be induced to invest
two or three hundred million ven in
Japanese securities.
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