ndoned. A prominent official named Sheng
Hsuan-hwai was appointed director-general of railways, and empowered
to enter into negotiations with foreign financiers for the purpose of
raising loans. It was still hoped that at least the main control would
remain in Chinese hands, but the diplomatic pressure of France and
Russia caused even that to be given up, and Great Britain insisting on
equal privileges for her subjects, the future of railways in China
remained in the hands of the various concessionaires. But after the
defeat of Russia by Japan (1904-1905) the theory of the undivided
Chinese control of railways was resuscitated. The new spirit was
exemplified in the contracts for the financing and construction of
three railways--the Canton-Kowloon line in 1907, and the
Tientsin-Yangtsze and the Shanghai-Hangchow-Ning-po lines in 1908. In
the first of these instances the railway was mortgaged as security for
the loan raised for its construction, and its finance and working were
to be modelled on the arrangements obtaining in the case of the
Imperial Northern railway, under which the administration, while
vested in the Chinese government, was supervised by a British
accountant and chief engineer. In the other two instances, however, no
such security was offered; the Chinese government undertook the
unfettered administration of the foreign capital invested in the
lines, and the Europeans connected with these works became simply
Chinese employes. Moreover, in 1908 the Peking-Hankow line was
redeemed from Belgian concessionaires, a 5% loan of L5,000,000 being
raised for the purpose in London and Paris. In that year there was
much popular outcry against foreign concessionaires being allowed to
carry out the terms of their contract, and the British and Chinese
corporation in consequence parted with their concession for the
Su-chow, Ning-po and Hang-chow railway, making instead a loan of
L1,500,000 to the ministry of communications for the provinces through
which the line would run. A double difficulty was encountered in the
construction and management of the railways; the reconciliation of the
privileges accorded to foreign syndicates and governments with the
"Recovery of Rights" campaign, and the reconciliation of the claims of
the central government at Peking with the demands of the provincial
authorities. As to the foreigners, Great Britain, France, Germany,