indemnity was becoming due, and it was much discussed how and on what
terms China would be able to raise the amount. The Russian government,
as has been stated, had made China a loan of the sum required for the
first portion of the indemnity, viz. L15,000,000, taking a charge on
the customs revenue as security. The British government was urged to
make a like loan of L16,000,000 both as a matter of friendship to
China and as a counterpoise to the Russian influence. An arrangement
was come to accordingly, on very favourable terms financially to the
Chinese, but at the last moment they drew back, being overawed, as
they said, by the threatening attitude of Russia. Taking advantage of
the position which this refusal gave him, the British minister
obtained from the Tsung-Li-Yamen, besides the declaration as to the
non-alienation of the Yangtsze valley above mentioned, an undertaking
to throw the whole of the inland waterways open to steam traffic. The
Chinese government at the same time undertook that the post of
inspector-general of customs (then held by Sir Robert Hart) should
always be held by an Englishman so long as the trade of Great Britain
was greater than that of any other nation. Minor concessions were also
made, but the opening of the waterways was by far the greatest advance
that had been made since 1860.

Of still greater importance were the railway and mining concessions
granted during the same year (1898). The Chinese government had been
generally disposed to railway construction since the conclusion of the
Japanese War, but hoped to be able to retain the control in their own
hands. The masterful methods of Russia and Germany had obliged them to
surrender this control so far as concerned Manchuria and Shan-tung. In
the Yangtsze valley, Sheng, the director-general of railways, had been
negotiating with several competing syndicates. One of these was a
Franco-Belgian syndicate, which was endeavouring to obtain the trunk
line from Hankow to Peking. A British company was tendering for the
same work, and as the line lay mainly within the British sphere it was
considered not unreasonable to expect it should be given to the
latter. At a critical moment, however, the French and Russian
ministers intervened, and practically forced the Yamen to grant a
contract in favour of the Franco-Belgian company. The Yamen had a few
days before explicitly promi