and died within two days of his wounds. An indemnity of 20,000 taels was paid to his family.

In addition to other troubles cholera was unusually prevalent throughout all parts of China, and the price of grain in the South rose to famine figures. But in spite of this, and of a fall in silver which paralysed foreign trade at the end of the year, the revenue of the Maritime Customs for 1902 was over 30,000,000 taels, by far the highest on record.

On November 1 the new tariff of import duties on the basis of 5 per cent. came into force.

Work on the Pekin-Hankow Railway has been steadily continued, and the progress at the south end has been satisfactory. In Ho-nan the Pekin syndicate has constructed some thirty miles of earthworks towards the head of water communication with Tien-tsin, and has begun mining operations. On the border of Kiangsi and Hu-nan ten miles of railroad are in working order, and the line is being continued towards the Hsiang River. The German line from Kiao-chou was opened to Wei-hsien in June, and is being carried on to Tsing-chouFu. Coal has been brought down by it from the mines opened near Wei-hsien. Work has been begun on the Canton-Hankow Railroad. In Kwei-chou the Anglo-French Company has been paying much attention to its quicksilver mines at Wen-shanchiang. A contract has been made with the Russo-Chinese Bank for 40,000,000 francs for the construction of a railroad from Cheng-ting-Fu to Tai-yuan-Fu in Shan-si. The BritishChinese Corporation has made arrangements with the Chinese Government for a loan in connection with the Shanghai-Nanking Railroad. Portugal has obtained a concession for a railroad from Macao to Canton.

The fortification of the Legations at Pekin has been completed, and the memorial erected by the Chinese Government to the memory of Baron von Ketteler, on the scene of his murder, was by the close of the year ready for dedication.

The Russo-Chinese line to Port Arthur gave in the autumn evidence of the speed at which communications with Europe will be carried on when the line is in working order. But the regular carriage of passengers and mails was postponed to the spring of 1903. In October M. Witte came from St. Petersburg to inspect the line and the new towns constructed along its route.

In Tao-mu, the Viceroy at Canton, and Liu-Kun-yi, the Viceroy at Nanking, who died within a few weeks of each other, China has lost two of her most capable officials. The funeral of the latter provoked a spontaneous acknowledgment from all foreign officials of their recognition of the value of his eminent services in 1900.

Liu-Kun-yi was succeeded at Nanking by Chang-Chih-tung, but in December Wei-Kuang-tao, a Hunanese, was appointed to the post, and it is uncertain whether Chang-Chih-tung will resume his old post at Wu-chang.

Tsai-chen, a son of Prince Ching, was appointed special envoy to attend the Coronation in June. Chang Te-yi has succeeded Sir Chi-Chen Lo-feng-lou as Ambassador at St. James's; and Sir Chen Tung Liang-cheng has been appointed to Washington vice his Excellency Wu-Ting-fang.

M. Dubail has succeeded M. Beau as Minister for France at Pekin. Sir E. Satow left Pekin in November on leave, and Mr. W. B. Townley was left in charge of his Majesty's Legation.

There has been a certain display of reform in education in China. Colleges have been opened in eleven of the provinces in response to edicts ordering the encouragement of Western science. Foreigners have also been engaged by several of the provincial Governments as advisers. The most genuine advance appears to be in Hu-nan, where a Protestant chapel has been opened in the capital, which for so many years was closed to all foreigners, and British gunboats have been up the Hsiang River to Hsiang-tau, and up the Yuan River to Chang-te-Fu.

II. WEI-HAI-WEI (BRITISH).

Early in the year his Majesty's Government announced its intention of using Wei-hai-wei only as a sanatorium and place for small arm naval practice, and of abandoning the idea of fortifying it and keeping a large garrison there. In accordance with this policy orders were given for the reduction of the Chinese Regiment from 1,100 to 300 men, of whom a police force was to be formed. At the close of the year, however, it was determined to maintain the regiment at a strength of 400

men.

The Hon. J. H. Stewart Lockhart was appointed Civil Commissioner of the Colony, and arrived there on May 3.

III. KIAO-CHOU (GERMAN).

Much energy has been shown in railway and mining matters. The railway from Tsing-tao to Wei-hsein was opened on June 1, but progress to Tsing-chou-Fu has been delayed, first by floods which carried away part of the embankments, and afterwards by difficulty experienced in laying the road across a deep morass. At Fang-tzu, near Wei-hsien, a shaft has been sunk sixty feet deep, and coal was sent thence by rail to Tsing-tao in October.

IV. HONG-KONG.

A water famine occurred in April which was only met by drawing on private reservoirs.

The recurrence of the plague led to action being taken on the recommendation of a sanitary commission, and $1,000,000 were voted towards resumption of property and claims for compensation in the area in question.

The Revenue of 1901 showed an excess of income over expenditure of $100,000. The expenses entailed by sanitary and

other public works in 1902-3 will be met by a loan of $2,250,000 and an increase in licence and other fees estimated at $300,000. The Hong-Kong regiment was abolished and left for India in October. Work was begun on the new King's Park at

Kao-loon.

Sir H. Blake, G.C.M.G., returned to the Colony in September, relieving General Sir W. J. Gascoigne.

Sir W. M. Goodman was appointed Chief Justice; the Hon. F. H. May, C.M.G., Colonial Secretary; and Sir H. S. Berkeley Attorney-General.

V. FRENCH INDO-CHINA.

The most important event of the year was the opening of the railway on February 28 from Hanoi to Haiphong, which crosses the Red River by a bridge 1,620 metres long. The railroad from Hanoi to Nandinh was also completed and ready for traffic by the end of the year.

The construction of a harbour in deep water at Haiphong was authorised at an estimated cost of 21,000,000 francs.

The trade of 1901 showed an increase of 60,000,000 francs on 1900. At the close of 1902 trade was disorganised by the depreciation of silver, and more especially by the adoption by Siam of a gold standard. In consequence of this a commission was appointed by the French Ministers of Finance and Colonies to report on the probable consequences to trade and finance of the currency difficulty.

M. Beau, French Minister at Pekin, was appointed to succeed M. Doumer as Governor-General.

An International Exhibition was opened at Hanoi on November 16, and the Oriental Congress met there by invitation in December.

[The Franco-Siamese Agreement is dealt with by Sir Charles Roe under "Siam" in Chapter V.]

VI. COREA. [See also under "Japan," p. 393.]

Distress was occasioned in the early part of the year owing to the rice crop failure in 1901, when the rainfall was only 4.1 inches, but the trade returns showed an advance in value of 400,000l. over 1901. Among exports gold figured for 509,7381.

Work was begun on the Söul-Fusan Railway, and on the southern section cars have been running on some ten miles of the line. On the Soul-Wiju Railway work has been done in but a desultory manner.

Prince Yi Chai Kak was sent as special envoy to attend the Coronation in London. An Ambassador, Pak Chia San, was sent to Pekin.

M. Pavloff, the Russian Minister, left in the summer, and M. Waeber returned to Soul in the autumn on a special mission. A commercial treaty was made with Denmark.

W. R. CARLES.

VII. JAPAN.

In January the veteran Premier of Japan, Marquis Ito, visited England. He was received with great cordiality, being entertained by the Lord Mayor and created a G.C.B. by the King. He subsequently received similar honours at Berlin and Rome. Later in the year Count Matsugata, ex-Premier and Finance Minister, visited England, and Prince Komatsu, G.C.B., came in order to represent the Emperor at the King's Coronation.

The Mikasa, the last of six line of battle-ships built for Japan in England, and perhaps the most powerful ship of its class in the world, was completed. Two very large and fast destroyers" were built by Messrs. Thorneycroft for the Japanese Government during the year.

The Budget for 1902-3 showed the following figures:

On January 30, after a year's negotiation, of which the secret was successfully kept, an agreement was signed between Great Britain and Japan.

[Its tenor and its reception in Great Britain are dealt with on pp. 58-60.]

In Japan the British treaty was welcomed with enthusiasm. The Japanese were proud of having concluded an alliance on equal terms with a first-class European Power, and felt guaranteed against any such humiliations in the future as the compulsory retrocession of Liao-tung. On the whole it may be said, in the words of the King's Speech at the end of the session of 1902, that "it will contribute towards the maintenance of the general peace in the extreme East." Still the situation is not without danger. The Japanese are an impulsive nation. More than once in recent times there have been crises in their foreign relations when it required all the influence of their more sober-minded statesmen to restrain them from dangerous bellicose measures. It is doubtful whether Russia will long maintain her present attitude of acquiescence in the growing commercial, financial and political preponderance of Japan in Korea, while Japan, on the other hand, with a strong Navy, a well-organised Army and a powerful ally is certain to resent warmly any affront or aggression on the part of Russia. Nevertheless, the necessity of consulting a pacific ally must have steadying influence. The Agreement has already borne fruit in strengthening the British position in China and in confirming Japanese preponderance in Korea.

[The reception of the Anglo-Japanese Agreement by Russia

and France is referred to under "China" in the earlier part of the present chapter.]

On July 4 Lord Cranborne, speaking in the House of Lords, said, with reference to the Anglo-Japanese Treaty, "We do not seek alliances, we grant them." Some surprise and irritation were caused by this speech in Japan, which were soon, however, allayed by the explanations of Lord Cranborne's colleagues.

In March the Diet closed its sixteenth session, having been the first to complete the prescribed term of four years from a general election. The elections, which took place in August under the new ballot regulations, passed off quietly and made little apparent change in the position of parties. The Seiyukai, to which Marquis Ito belongs, retained its preponderant position. It soon appeared, however, that this party was no longer satisfied to support a Government which did not adequately represent it. The Diet met on December 9. On re-assembling on December 28, after a short prorogation, they rejected the Budget proposals, notwithstanding a speech from the Throne in which they were strongly recommended. An immediate dissolution was the consequence. This Budget showed a revenue of 253,000,000 yen and an expenditure of 257,000,000 yen. It comprised a scheme of naval expansion involving an annual outlay of 16,500,000 yen for ten years and provided for the construction of three new battleships, three large armoured cruisers and two smaller cruisers. The objections of the majority were not to this programme in itself, but were directed against the means by which it was proposed to raise the money and especially against the maintenance of a high rate of land tax.

In February the Government of Australia arrived at an amicable arrangement with the Government of Japan, by which a question which threatened to become irritating, as to the introduction of Japanese immigrants to Queensland, was settled.

A somewhat similar question which had arisen in British Columbia was settled in June by the Governor-General of Canada disallowing Acts which imposed serious disabilities on Japanese immigrants to that province. His Majesty's Government saw this decision with great satisfaction.

In October a Japanese Government Loan of 50,000,000 yen (say 5,000,000l.) was placed on the London market by the Hong-Kong and Shanghai Banking Corporation and Baring Brothers. The subscription for bonds, issued at par and bearing 5 per cent. interest, was fully covered. Smaller 6 per cent. loans to the Yokohama Waterworks and the Osaka municipality were also floated.

The Wakamatsu iron foundry (mentioned in the ANNUAL REGISTER for 1901, p. 369), upon which the Japanese Government has expended many millions of yen, has hitherto not proved a success, as it is found impossible to produce iron there nearly so cheaply as it can be bought in the market. There is talk of disposing of it to a private company.