Potsdam, where he was received by the Emperor, to whom he delivered a letter of apology from the Emperor of China. After staying a few days in Germany he returned direct to China without visiting any other country.

Similarly, a high Manchu official, who was strongly suspected of having been an instigator of the Boxer movement, was sent to Japan to express regret for the murder of Mr. Sugiyama, Chancellor of the Japanese Legation. About the same time the Chinese Government proposed sending a somewhat obscure official named Chang Po-hsi to England to offer condolences on the death of Queen Victoria, and congratulations on the accession of King Edward. The proposal was declined on the ground that atonement must first be made for the events of last year.

In August an Imperial Decree was issued suspending literary examinations for five years in the districts where foreigners had been murdered during the late outbreak. In the same month was published an Imperial Decree forbidding the importation of arms for two years, the prohibition to be subsequently renewed if the foreign Powers required it.

As a condition of raising the import tariff to an effective 5 per cent. it was stipulated that the ad valorem duties should as soon as possible be converted into specific duties, and, furthermore, that measures should be taken to improve the navigation of the river Peiho at Tien-tsin, and the river Hwangpu at Shanghai. To that end a Conservancy Board was appointed for the Shanghai River on which were represented both Chinese and foreign interests. It was estimated that the work would take twenty years and that the annual outlay would amount to 400,000 taels a year. This sum was to be supplied in equal shares by the Chinese Government and the foreign interests concerned.

In July an Edict was published abolishing the Tsung-liYamên or Department of Foreign Affairs, and creating a new Board of Foreign Affairs, styled Wai Wupu, with precedence over the other six great departments of State.

The above comprises the principal points indicated in the demands presented by the foreign Powers, and on September 7 a protocol was signed at Pekin by the Chinese and foreign plenipotentiaries which recited the demands of the Powers and the manner in which effect had been given to them by the Chinese Government. The foreign Powers agreed to withdraw their troops from Pekin and from the province of Chihli during the course of the month, with the exception of the force which it had been agreed should be left for the defence of the Legations, and the approaches to Pekin from the sea-board.

The settlement thus arrived at cannot be considered satisfactory, and it fell far short of what was expected when the foreign troops entered Pekin. It was soon discovered that there were no means of putting pressure on the Court, and that

the concert of foreign Powers was not likely to last long. The Empress, who throughout the negotiations not only retained but strengthened her power, was mistress of the situation, for apart from personal inconvenience she suffered nothing by moving the Court to Si-an Fu, whereas the desire of all foreignPowers for the return of the Court to Pekin was throughout too apparent. It had been hoped that one of the results obtained would be greater commercial facilities, but the prospect is not encouraging. In the original list of demands put forward for China's acceptance in December, 1900, was one clause which ran as follows: "The Chinese Government will undertake to negotiate regarding amendments to the Treaties of Commerce and Navigation considered useful by the Powers, and also other subjects connected with Commercial relations with the object of facilitating them."

In the final protocol, signed in September, which recited the steps which China had taken to give effect to the demands of the Powers, this clause is disposed of by a mere reiteration of China's undertaking to negotiate in the terms desired. There are no stipulations as to what China shall do in satisfaction of this promise, and it is not being too pessimistic to anticipate that on the part of the Chinese negotiators nothing will be conceded to our advantage which is not fully balanced by a corresponding concession on our part.

In September a special commission was appointed by his Majesty's Government to proceed to China to deal with the commercial questions referred to above. The members were Sir James L. Mackay, K.C.I.E., a member of the India Council, with two assistant commissioners, Mr. Henry Cockburn, C.B., of his Majesty's Legation, and Mr. C. J. Dudgeon, of the firm of Ilbert & Co., Shanghai. The Chinese Government as their representative appointed Sheng Hsuan-huai, Director-General of Telegraphs, assisted by two Maritime Customs Commissioners, Messrs. A. E. Hippisley and F. E. Taylor. One of their duties will be to prepare a table of specific duties to take the place of the 5 per cent. ad valorem tariff which came in force after the signing of the peace protocol; but in the meantime a specific tariff, locally prepared at Shanghai, was temporarily adopted, as it was found impracticable to levy duties on an ad valorem basis.

In August was completed the scheme for the defence of the foreign Legations. An area about a mile in length and a quarter of mile in depth was surrounded by a wall loopholed throughout, and the ground outside this wall was cleared of houses for a certain distance. The southern boundary of the Legation area is formed by the city wall itself, which for a section between two of the city gates dominates the foreign quarter.

Although foreign troops remained in Pekin until September, as early as January a beginning was made of restoring Chinese authority. Chinese Judges with power of awarding

the death penalty were appointed by the foreign commanders in the quarters of the city respectively held by them, and the policing of the city was gradually replaced in the hands of the Chinese, in anticipation of the time when foreign troops would evacuate Pekin.

On April 17 a portion of the Imperial Palace in Pekin which was being used as the headquarters of Field-Marshal Count von Waldersee was destroyed by fire, and General Schwarzhoff, the Chief of the Staff, lost his life.

The formal evacuation of Pekin took place on September 17, when the Japanese and American Guards handed over the Forbidden City to the Chinese.

At the suggestion of the British and American Ministers the honours of which Chang Yin-hwan had been deprived were restored to him posthumously. It was he who had been Chinese Minister for some years at Washington, and came to England on the occasion of the Diamond Jubilee. Having been banished to Turkestan at the time of the coup d'Etat in 1898, he was put to death by order of the Empress-Dowager at the beginning of the anti-foreign outbreak in 1900.

The Chinese Government proposed to send a mission to collect contributions from Chinese abroad towards the payment of the indemnity, and they applied to the foreign Powers concerned for passports, but these were refused.

In October the Heir Apparent, Pu-chun, was set aside by the Empress-Dowager. He was the son of Prince Tuan, who received a sentence of banishment for his participation in the anti-foreign movement, and this fact made it impossible that his son could succeed as Emperor. No successor to the Emperor Kwanghsü, who is childless, has yet been named.

In December a striking ceremony took place at Tungchow, near Pekin. During the Boxer outbreak a fearful massacre of native converts had taken place. The Protestant missionaries, chiefly Americans, agreed not to press for the punishment of the guilty on the condition that the Chinese officials made public atonement and impressed on the people that missionaries and their converts must be respected and protected. A most imposing funeral procession was arranged, and all the principal officials were in attendance at the cemetery where the coffins of some seventy victims were buried.

In the course of the year several Imperial Edicts were promulgated which seemed to indicate that the Court intended to adopt measures of reform; these manifestoes dealt chiefly with changes in the educational system, the selection of competent officials, and the abolition of useless offices; but these promises of reform have been made so often before that they must not be taken as showing that any real change will take place. Yuan Shih-Kai, the new Viceroy of Chihli, engaged several Japanese officers in December to drill his troops. The Japanese Government offered to lend China a general to

reorganise her army, and this proposal was strongly supported by Yuan Shih-Kai, with what result is not yet known.

The Court, which on the approach of the foreign troops had fled from Pekin to Si-an Fu, started on the return journey on October 6. It proceeded very leisurely, and at much expense to the towns on the road. By the end of the year it had reached Kai-feng-fu, the capital of Honan, where it halted to await the course of events in Pekin. It resumed its journey towards Pekin in the beginning of December.

M. Beau replaced M. Simon as French Minister at Pekin, and M. Lessar succeeded M. de Giers as Russian Minister. Admiral Sir Edward Seymour's term of service was extended so long as the situation in China was critical, and he was then replaced by Admiral Sir Cyprian Bridge.

It was announced that Chang Te-yi would succeed Lo Fengluh as Chinese Minister in London, but the change has not yet taken place.

Early in the year an Imperial Decree ordered Yuan ShihKai, the Governor of Shantung, to proceed to Pekin to assist in the peace negotiations. Later, when Li Hung Chang died, he was appointed to succeed him as Viceroy of Chihli. The rise of Yuan Shih-Kai has been phenomenally rapid, and at the age of forty-three he is probably the youngest official who has held such high position. He first came into notice as Chinese Resident in Corea when China, as the suzerain Power, required to have a strong man to keep the King of Corea straight, in the early days of the emergence of the Hermit Kingdom from seclusion into the arena of international relations with the outside world. In 1898 Yuan Shih-Kai was Commandant of the Chief Army Corps in the metropolitan provinces and at the time of the coup d'Etat which deposed the Emperor the fate of the Throne lay in his hands. He sided with the Empress-Dowager, and his reward was the Governorship of Shantung. When the Boxer rising occurred he threw the Empress-Dowager's cause over and sided with the Yangtze Viceroys who refused to be drawn into the antiforeign movement. While Governor of Shantung he issued a proclamation promising to protect foreign missionaries and their converts; and went out of his way to invite missionaries to return to their work on the ground that they set a good example, and did not interfere with the course of Chinese justice. Li Hung Chang's successor in the Viceroyalty and as Imperial Commissioner for the North he is one of the coming men, and even now he and Jung-lu are the two men who have most influence with the Empress-Dowager.

As

The death of Li Hung Chang at the age of seventy-eight occurred on November 7. He had outlived by some years the great reputation he had made, and his removal from the scene had no immediate effect on Chinese politics. For some years he had been suspected of being the tool of Russia, and, from whatever motive, it is true that he was willing and even anxious to put

Russia in such a position in Manchuria as would have meant in a few years the absolute cession of that country. His influence with the Court, especially in international questions, was so great that it is probable that had he lived much longer Manchuria would have been practically lost to China; and his death now leaves the patriotic provincial viceroys, who still hope to preserve the integrity of China, in a much stronger position. By order of the Empress a temple is to be erected to his memory; and the title of marquess is conferred on his eldest son and successors for twenty-three generations. Li Hung Chang himself had the rank of earl.

Owing to the disturbed condition of the north and the seizure by the allies of the Pekin-Shanhaikuan railway, there were no earnings out of which to pay the February coupon for interest due to the British bondholders. The contract for the railway loan gives the bondholders the right to take possession of the railway in the event of such default, and the Chinese Government was desirous that the bondholders should take over the railway. The explanation probably is that, as the railway was at the time under Russian military occupation, the Chinese hoped that Great Britain and Russia would quarrel over the affair. The bondholders were ready to take over such a valuable asset, but the British Government discouraged the transaction and pointed out to China how her credit would suffer at this juncture if the Government repudiated its liability; and money was then found to pay the coupons.

Both the Pekin-Tien-tsin railway and the Paotingfu-Pekin railway were brought into Pekin, breaches being made in the city wall to admit the lines. On February 21 the PekinShanhaikuan railway, which since the commencement of hostilities had been under Russian control, was handed over to the British military authorities, who continued to run it throughout the year. In spite of the disturbed state of the country and the interruption of trade, the receipts under British management far exceeded those which the line had yielded when under native control. The British military authorities extended the line beyond Pekin as far as the city of Tungchow, which is at the head of the navigation of the Peiho River.

The city of Tien-tsin continued to be under the control of the so-called Provisional Government, consisting of Commissioners nominated by the principal Powers. Much good work was done in improving the city. The city walls were removed and new roads and canals were constructed, and under the supervision of the Provisional Government the work of improving the navigation of the river Peiho was begun. After the withdrawal of the army of occupation from the province of Chihli the Chinese authorities requested that the city of Tien-tsin should be handed back to them, but for the present the military occupation continues.

A dispute which at one moment seemed likely to have very