The New York herald., 1921-11-25
EXPERTS BUSY WITH
FINANCES OF CHINA
Subcommittee Takes the First
Step by Examining the
Customs System.
REAL AID IN CONSORTIUM
Plan for Different Nations to
Fix and Supply O Loan
Presents Difficulties.
BY GEORGES LIE CHARTER.


Correspondent of the JoursioI Les Debots.
special Despatch to THE NEw YoRK HlnALp.
! New York Herald Bureau.
Washington, ID. c.. Nov. "a.
The subcommittee appointed to study
the financial situation of China and
to try to find way out Of her present
financial mess. is now at work. We are
Toll that the first step was taken yes
terday, when the examination of the
actual Chinese customs system was be-
gun. 1t is generally admitted that by
this system China does not collect all
the revenue she could get from her i'm
portaticns. The question is in no way
simple.
1t has been suggested that a relaxa-
ton OF the limitations put by treaties,
In amount Of Chinese customs collection.
is now essential for China II She must
obtain from her custom tariff the rev.
enue which she badly needs If she Is
to restore herself.
Of course all tho benefit OF the meas
ure will depend on the manner in which
1t is applied. It has never. until yester
day. been imagined that II should be en-
forced by the Chinese Government alone
generally appeared that China has amply
proved herself wholly and utterly in-
capable of organizing her own finances.
1t has been assumed that should China
become free Of her present control her
annual custom Income would fall from
S7o.00.000 actually collected to sl2,0oo.oco.
or less, where ii stood before 1t was
n over and handled by the present
organization. Moreover, China Is row
IN, e.ta tt,o .f IN "a
has not paid the interest OF her debt
to the United States. As any other
bankrupt. she must legally have syn
dicate or board Of administrators as
signed to handle the interest or the
creditors as hers.
That seems to be the opinion of all
those who have been in China and know
something Of the status and ability OF
the Chinese at home.
So the declaration and protest OF Or.
SEE and Chinese delegates caused
good deal Of surprise among most of the
other delegates, especially among the
British and French experts. The inter-
probation given by DIR. Sze-and. later
on, by DR.. Koo-of the recent four
basic principles formulated by Mr.. Root
and indorsed by the seven nstions rep
resented at the conference Is to-day
concurrently held as entirely inadmis-
sible.
The contention of the Chinese is that
the four Root principles not only do not
imply the acceptance of any control or
consortium of bankers to administrate
her finances. but assure TO her unre-
stricted freedom and right TO admins
trate, on her own plan. her custom sys-
tenn. And she wants to be allowed. al
ways under thu same principles. to es-
tablish and work the new regime at
nr Gn
as to present three demands for gradual
recuperation by China of her financial
rights.
The Chinese delegation. OF more ex-
actly. Mr.. Wellington Koo. does not
seem to realize, or even to imagine that.
we're his demands to be acGorded, and
were China to be permitted on January
1. 1922, to run uncontrolled her new
custom tariff, the suggested increase of
the tariff Limitation having been war
ranted her. would not bring her 121a
per cent. on import; not even the actual
per cent. But, as previous experiences
have abundantly shown, the entire in
come in her own hands would so be
dispersed or swallowed up by so many
official appetites that for the one or
other existing republics of China 1t
would finally come TO nausht.
The only way to help China, besides
some foreign control taking care OF her
custom revenue, is for China to accept
that a consortium Of bankers belonging
to the various nations represented at the
conference, fix and supply a loan to her.
OF course, the affair Will not be an easy
one There is no money in France TO
lend to anybody, and a loan to China
will find still less favor among the
French public than among any other.
There is not much more money to be ex-
pected from the English public: nor is
there from the American public by which
China, not having paid the interest OF
her last loan, Is or should be considered
bankrupt. How this Chinese loan will
be launched by the representatives OF
these respective countries II rests 10 be
shown. In any case, IL Is obvious that
could this loan be floated. the invest
ment should be made under direct con-
troll Of tho consortium creditor as long
as the loan would last