206. REPORT ON COOPERATION IN AMERICAN EXPORT TRADE.

composed of such important manufacturing firms as Cravens (Ltd.) ;
Dorman, Long &amp; Co. (Ltd.) ; Thos. Firth &amp; Sons (Ltd.) ; Sir William
Arrol &amp; Co. (Ltd.), ete. It is not a trading concern; its sole object
is to establish and maintain staff representatives in certain Asiatic
ports for the sale of manufactures. It thus combines the features
of an agency or propaganda and a selling organization.
The Germans shortly prior to the outbreak of the war were instituting
 similar import combinations. The Export Verband of Germany
 is an illustration. This company had started an organized
effort of trade propaganda. It was an agency of represéntation for
discovering and investigating trade opportunities and guiding manufacturers
 in Germany in their competition with foreign enterprise.
International combinations.—The international cartels, syndicates,
or combinations which engage in business in China are mainly banks
or institutions created for loaning purposes or carrying into effect
the terms of the loan given.
The greatest of these is the Hongkong-Shanghai Bank, which was
incorporated by special ordinance of the legislative council of Hongkong,
 July 20, 1867, and confirmed by her late Majesty’s Government.
It has a capital of $15,000,000 Mexican, a reserve of $32,000,000
Mexican, and has branches in all the large cities in India, China, and
Japan. Up to 1905 the operations of the bank were practically confined
 to exchange business, but, from 1905 on, the policy and proceedings
 of the bank were completely changed. All the large British
rallway and governmental loans have been made through its Peking
agency.
The English concern, Jardine, Matheson &amp; Co. (Ltd.), are the fiscal
agents and business partners for the Hongkong-Shanghai Bank, and
up to 1905 the political side of the operations of that bank was handled
 entirely by this firm. It took charge of the expenditure of the
bank’s loans on railways, and in handling such business it secured a
5 per cent prciasyy commission. This concern, as merchants, represents
 25 firms, while in their engineering department they are the
sole agents for some 26 manufacturing establishments from the different
 parts of the world.
An outgrowth of the connection of the Jardine, Matheson &amp; Co:
combining with the Hongkong-Shanghai Bank is the British &amp;
Chinese Gorporation (Ltd.), or sometimes called the Chinese Central
 Railways (Ltd.). This is an Anglo-French syndicate formed
in 1898 in view of German competition with the English loans in the
Yangtsze Valley, and it was used by the British for the purpose of
nndertaking railway and financial Hor ho north of the Yangtsze
River. To this syndicate was intrusted the carrying out of some of
the valuable concessions obtained by the British Government.
The German financial interests are represented in China by a
branch of the Deutsch-Asiatische Bank, which began to exert influence
 in 1895, at which time, by agreement with the Hongkong-Shanghai
 Bank, it secured a share of the British loans in the
Yangtsze Valley, and by 1909 effective control of the loan funds in
the case of the Tientsin-Pukow Railway. This bank used several
large German firms as its fiscal agents in China, such as Carlowitz &amp;
Co., import and export merchants, and Diederichsen &amp; Co., Government
 contractors.