Peking, Feb. 5.
A conference began yesterday between General Chang Tso-lin and the representatives of Heilungkiang, Kirin, Snaiyuan and Jehol, in connexion with which Mr. Chang Ching-hui left for Mukden from Peking yesterday morning, after a lengthy discussion of the political situation with the Chibli representatives.
Another conference begins at Paotingfu to-day between the re-which made loans to the Govern-iment for various periods on the security of the salt surplus, are; now forming a coalition for the! purpose of consolidating the hypothecation of the salt surplus to the extent of a total of $96,000,- 000, whereof $26,000,000 is from the Japanese, British, French and Russian banks. The Bank of China and the Bank of Communications are organizing the coalition.
The banks suggest that the Government should issue notes covering the total, at eight per cent, interest and at ten per cent. discount to the public, plus—six per cent. discount to the bankers, redeemable in eight years. The first security will be the prospective increase in the Customs revenue, and the second' the salt surplus.
The banks are now negotiating with the Ministry of Finance to arrange for the Foreign Inspectorate's recognition of this obligation. This would be inevitable if the Consortium refused to finance" a similar consolidation, thereby forfeiting according to Article 17 of the old Consortium Agreement their claim upon this security. The foreign authorities are of the opinion that this eventuality would put an end to the Consortium.
In the anticipation of a small salt surplus, the bankers' mutual agreement calls for five per cent. interest only for the first year, and thereafter full interest with 14 half-yearly amortizations.
The Chinese bankers say that this is not a loan, since no money is involved. it being but a readjustment of book-keeping and also a combination to improve the security and ensure the payment of interest, which the individual banks are powerless to arrange.
Text read from the printed page and cleaned; old type leaves the occasional error.