The Fight For The Republic in China Part 42

Art. 5. The administration measures entrusted by the Government to the Shenchang shall be enforced by the administrative organs under his supervision, and he shall be responsible for same.

Art. 6. In the enforcement of the laws and mandates of the Central Government, or of the laws and regulations of his province, he may issue orders.

Art. 7. The province shall establish the following five Departments, namely Interior, Police, Finance, Education and Industry. There shall be one Department Chief for each Department, to be appointed by the Shenchang.

Art. 8. A Provincial Council shall be organized to a.s.sist the Shenchang to enforce the administrative measures, and it shall be responsible to the Provincial a.s.sembly for same.

This Council shall be composed of all the Departmental Chiefs, and five members elected out of the Provincial a.s.sembly. It shall discuss the Bills on Budget, on administration, and on the organization of police forces, submitted by the Shenchang.

Art. 9. If one member of the Council be impeached by the Provincial a.s.sembly, the Shenchang shall replace him, but if the whole body of the Council be impeached, the Shenchang shall either dissolve the a.s.sembly or dismiss all his Departmental Chiefs. In one session the a.s.sembly shall not be dissolved twice, and after two months of the dissolution, it shall be convened again.

Art. 10. The organization and election of the Provincial a.s.sembly shall be fixed by law.

Art. 11. The Provincial a.s.sembly shall have the following duties and powers: (a) It may pa.s.s such laws as allowed by the Const.i.tution. (b) It may pa.s.s the bills on the provincial Budget and Accounts. (c) It may impeach the members of the Provincial Council. (d) It may address interpellations or give suggestions to the Provincial Council. (e) It may elect Members for the Provincial Council. (f) It may attend to the pet.i.tions submitted by the public.

Art. 12. A Magistrate shall be appointed for each hsien district to enforce administrative measures. He shall be appointed directly by the Shenchang, and his term of office shall be three years.

Art. 13. The Central Government shall hold examinations in the provinces for candidates for the Magistracy. In a province half of the total number of magistrates shall be natives of the province and the other half of other provinces; but a native shall hold office of Magistrate 300 _li_ away from his home.

Art. 14. The organization for the legislative organ of the hsien district shall be fixed by law.

TARIFF REVISION IN CHINA

The following is a translation of a memorandum prepared by the Ministry of Agriculture and Commerce regarding abolition of likin and an increase of the Customs duties:--

THE MEMORANDUM

"Disproportionate taxation on commodities at inland towns and cities tends to cripple the productive power of a country. Acting upon this principle, France in the 17th, England, America, Germany and Austria in the 18th Century abolished such kind of taxation, the Customs tariff remaining, which is a levy on imports at the first port of entry. Its purpose is to increase the cost of production of imported goods and to serve as a protection of native products (sic). Raw materials from abroad are, however, exempt from Customs duty in order to provide cheap material for home manufactures. An altogether different state of affairs, however, exists in this country. Likin stations are found throughout the country, while raw materials are taxed. Take the Hangchow silk for instance. When transported to the Capital for sale, it has to pay a tax on raw material of 18 per cent. Foreign imported goods on the other hand, are only taxed at the rate of five per cent _ad valorem_ Customs duty at the first port of entry with another 2.5 per cent transit duty at one of the other ports through which the goods pa.s.s.

Besides these only landing duty is imposed upon imported goods at the port of destination. Upon timber being s.h.i.+pped from Fengtien and Antung to Peking, it has to pay duties at five different places, the total amount of which aggregates 20 per cent of its market value, while timber from America is taxed only ten per cent. Timber from Jueichow to Hankow and Shanghai is taxed at six different places, the total amount of duty paid aggregating 17.5 per cent., while timber imported from abroad to these ports is required to pay Customs duty only one-third thereof. The above-mentioned rates on native goods are the minimum. Not every merchant can, however, obtain such special 'exemption,' without a long negotiation and special arrangements with the authorities. Otherwise, a merchant must pay 25 per cent of the market value of his goods as duty.

For this reason the import of timber into this country has greatly increased within the last few years, the total amount of which being valued at $13,000,000 a year. Is this not a great injustice to native merchants?

THE CHINESE METHOD

"Respecting the improvement of the economic condition of the people, a country can hardly attain this object without developing its foreign commerce. The United States of America, Germany and j.a.pan have one by one abolished their export duty as well as made appropriations for subsidies to encourage the export of certain kinds of commodities. We, on the other hand, impose likin all along the line upon native commodities destined for foreign markets in addition to export duty.

Goods for foreign markets are more heavily taxed than for home consumption. Take the Chekiang silk for instance. Silk for export is more heavily taxed than that for home use. Different rates of taxation are imposed upon tea for foreign and home markets. Other kinds of native products for export are also heavily taxed with the result that, within the last two decades, the annual exports of this country are exceeded by imports by over Tls. 640,000,000,000. From the 32nd year of the reign of Kuang Hsu to the 4th year of the Republic, imports exceed exports on the average by Tls. 120,000,000. These, figures speak for themselves.

LIKIN

"Likin stations have been established at places where railway communication is available. This has done a good deal of harm to transportation and the railway traffic. Lately a proposal has been made in certain quarters that likin stations along the railways be abolished; and the measure has been adopted by the Peking-Tientsin and Tientsin-Pukow Railways at certain places. When the towns and cities throughout the country are connected by railways, there will be no place for likin stations. With the increase in the number of treaty ports, the 'likin zone' will be gradually diminished. Thencefrom the proceeds from likin will be decreased year by year.

"Owing to the collection of likin the development of both home and foreign trade has been arrested and the people are working under great disadvantages. Hence in order to develop foreign and home trade the Government must do away with likin, which will bring back business prosperity, and in time the same will enable the Government to obtain new sources of revenues.

"From the above-mentioned considerations, the Government can hardly develop and encourage trade without the abolition of likin. By treaty with Great Britain, America and j.a.pan, the Government can increase the rate of Customs tariff to cover losses due to the abolition of likin.

The question under consideration is not a new one. But the cause which has prevented the Government from reaching a prompt decision upon this question is the fear that, after the abolition of likin, the proceeds from the increased Customs tariff would not be sufficient to cover the shortage caused by the abolition of likin.

COST OF ABOLITION OF LIKIN

"But such a fear should disappear when the Authorities remember the following facts:--

"(a) The loss as the result of the abolition of likin: $38,900,000.

"(b) The loss as the result of the abolition of a part of duty collected by the native Customs houses: $7,300,000.

"(c) Annual proceeds from different kinds of princ.i.p.al and miscellaneous taxes which shall be done away with the abolition of likin $11,800,000.

"The above figures are determined by comparing the actual amount of proceeds collected by the Government in the 3rd and 4th years of the Republic with the estimated amount in the Budget of the fifth year. The total amount of loss caused by the abolition of likin will be $58,000,000.

INCREASE OF CUSTOMS TARIFF

"The amount of increase in the Customs tariff which the Government expects to collect is as follows:--(a) The increase in import duties $29,000,000. (b) The increase in export duties Tls. 6,560,000.

"The above figures are determined according to the Customs returns of the 2nd, 3rd, and 4th years of the Republic. By deducting Tls. 2,200,000 of transit duty, the net increase will be Tls. 33,600,000, which is equal to $48,500,000. For the sake of prudence, allowance of five per cent. of the total amount is made against any incidental shortage. The net revenue thus increased would amount to $46,100,000. Against the loss of $58,000,000, there will be a shortage of some $11,900,000. This, however, will not be difficult to make good by new sources of revenue as the result of a tariff revision:--(a) Tax on goods at the time of manufacture $800,000. (b) Tax on goods at the time of sale $8,000,000.

(c) Tax on cattle and slaughtering houses $2,000,000. (d) Tax on foodstuffs $4,000,000.

"Under (a) and (b) are the taxes to be collected on native made foreign imitation goods and various kinds of luxurious articles. Under (c) and (d) are taxes which are already enforced in the provinces but which can be increased to that much by reorganizing the method of collection. The total sum of the proceeds set forth under above items will amount to $14,800,000. These will be quite sufficient to cover the loss caused by the abolition of likin.

A VITAL INTEREST

"As the abolition of likin concerns the vital interest of the merchants and manufacturers, it should be carried out without delay. The commercial and industrial enterprises of the country can only thrive after likin is abolished and only then can new sources of revenue be obtained. This measure will form the fundamental factor of our industrial and economical development. But one thing to which we should like to call the special attention of the Government is the procedure to be adopted to negotiate with the Foreign countries respecting the adoption of this measure. The first step in this connection should be the increase of the present Customs tariff to the actual five per cent _ad valorem_ rate. When this is done, proposals should be made to the Powers having treaty relations with us concerning the abolition of likin and revision of Customs tariff. The transit destination duties on imported goods should at the same time be done away with. This would not entail any disadvantage to the importers of foreign goods and any diplomatic question would not be difficult of solution. Meantime preparatory measures should be devised for reorganizing the method of collecting duties set forth above so that the abolition of likin can take place as soon as the Government obtains the consent of the foreign Powers respecting the increase of Customs tariff."

MEMORANDUM

THE LEADING OUTSTANDING CASES BETWEEN CHINA AND THE FOREIGN POWERS

(Author's note. The following memorandum was drawn up by Dr. C.C. Wu, Councillor at the Chinese Foreign Office and son of Dr. Wu Ting-fang, the Foreign Minister, and is a most competent and precise statement. It is a noteworthy fact that not only is Dr. C.C. Wu a British barrister but he distinguished himself above all his fellows in the year he was called to the Bar. It is also noteworthy that the Lao Hsi-kai case does not figure in this summary, China taking the view that French action throughout was _ultra vires_, and beyond discussion.)

BY DR. C.C. WU

Republican China inherited from imperial China the vast and rich territory of China Proper and its Dependencies, but the inheritance was by no means free from inc.u.mbrances as in the case of Outer Mongolia, Tibet and Manchuria, and other impediments in the form of unfavourable treaty obligations and a long list of outstanding foreign cases affecting sovereign and territorial rights.

I have been asked by the Editor of the _North-China Daily News_ to contribute an article on some of the outstanding questions between China and foreign powers, instancing Tibet, Manchuria, Mongolia, and to give the Chinese point of view on these questions. Although the subject is a delicate one to handle, particularly in the press, being as it is one in which international susceptibilities are apt to be aroused, I have yet accepted the invitation in the belief that a calm and temperate statement of the Chinese case will hurt no one whose case will bear public discussion but will perhaps do some good by bringing about a clear understanding of the points at issue between China and the foreign Powers concerned, and thus facilitating an early settlement which is so earnestly desired by China. I may say that I have appreciated the British sense of justice and fairplay displayed by the "North-China Daily News" in inviting a statement of the Chinese case in its own columns on questions one of which concerns British interests in no small degree, and the discussion cannot be conducted under a better spirit than that expressed in the motto of the senior British journal in the Far East: "Impartial not Neutral."

1 MANCHURIA

The treaty between China and j.a.pan of 1915 respecting South Manchuria and Eastern Inner Mongolia giving that power special rights and privileges in those regions has given rise to many knotty problems for the diplomatists of the two countries to solve. Two of such problems are mentioned here.

j.a.pANESE POLICE BOXES IN MANCHURIA AND MONGOLIA

Since the last days of the Tsings, the j.a.panese have been establis.h.i.+ng police boxes in different parts of South Manchuria and Eastern Inner Mongolia always under protest of the local and Peking authorities. Since the treaty of 1915, a new reason has become available in the right of mixed residence given to j.a.panese in these regions. It is said that for the protection and control of their subjects, and indeed for the interest of the Chinese themselves, it is best that this measure should be taken. It is further contended that the stationing of police officers is but a corollary to the right of exterritoriality, and that it is in no way a derogation of Chinese sovereignty.

It is pointed out by the Chinese Government that in the treaty of 1915, express provision is made for j.a.panese in South Manchuria and Eastern Inner Mongolia to submit to the police laws and ordinances and taxation of China (Article 5). This leaves the matter in no doubt. If the j.a.panese wish to facilitate the Chinese police in their duty of protection and control of the j.a.panese, they have many means at their command for so doing. It is unnecessary to point out that the establishment of foreign police on Chinese soil (except in foreign settlements and concessions where it is by the permission of the Chinese Government) is, to our thinking, at any rate, a very grave derogation to China's sovereign rights. Furthermore, from actual experience, we know that the activities of these foreign police will not be confined to their countrymen; in a dispute between a Chinese and a j.a.panese both will be taken to the j.a.panese station by the j.a.panese policeman. This existence of an imperium in imperio, so far from accomplis.h.i.+ng its avowed object of "improving the relations of the countries and bringing about the development of economic interests to no small degree," will, it is feared, be the cause of continual friction between the officials and people of the two countries.

As to the legal contention that the right of police control is a natural corollary to the right of exterritoriality, it must be said that ever since the grant of consular jurisdiction to foreigners by China in her first treaties, this is the first time that such a claim has been seriously put forward. We can only say that if this interpretation of exterritoriality is correct the other nations enjoying exterritoriality in China have been very neglectful in the a.s.sertion of their just rights.

In the Chengchiatun case, the claim of establis.h.i.+ng police boxes wherever the j.a.panese think necessary was made one of the demands. The Chinese Government in its final reply which settled the case took the stand as above outlined.

It may be mentioned in pa.s.sing that in Amoy the j.a.panese have also endeavoured to establish similar police rights. The people of that city and province, and indeed of the whole country, as evidenced by the protests received from all over China, have been very much exercised over the matter. It is sincerely hoped that with the undoubted improvement of relations between the two countries within the last several months, the matter will be smoothly and equitably settled.