SPECIAL REPORTS FOR FEDERAL TRADE COMMISSION. 223

For other comment under the heading of competitive conditions
nay, of course, be mentioned the extensive attaché systems of the
British and Germans in China, the aid rendered by the German Government
 to the German medicine and engineering school at Shanghai
and to other institutions throughout China for the education of
Chinese along German lines, with the naturally apparent results
thereof, and the close diplomatic support of foreign railway and loan
proposals, in accord with the spheres of influence and political considerations
 of the several powers.
Government attitude.—On the subject of the activities of the
Chinese Government in behalf of China’s industries for home competition
 with foreign products, reference might be made to the railway
 loan agreements, as for example the Hukuang Railway loan
agreement concluded May 20, 1911. This agreement provides that
“with a view to the encouragement of Chinese industries, preference
 avill be given at equal prices and quantities over British, French,
German, American, and other foreign goods to Chinese materials
and goods manufactured in China.” In the same article of the
agreement (Article XVIII) it is specifically recommended that rails
and their accessories should be manufactured and supplied by the
Hanyang Iron Works, the price to be settled by the ministry of
posts and communications with the Hanyang Iron Works, after
comparison with the current quotations for rails purchased by other
lines from Europe or America. Recently the Yangtze Engineering
Works (Ltd.), a Chinese company at Hankow, by virtue of the provisions
 of the same agreement became a competitor in bridge construction
 work with considerable success, and the agreement gives
the Chinese interests the further advantage that the purchasing
agents do not receive the 5 per cent purchasing commission on
Hanyang products furnished, such as is provided for on purchases
of materials from abroad.
The American consul general at Hankow mentions the Government
paper mill at Seven Mile Creek, near Hankow, and the Hupeh government
 spinning and weaving mills at Wuchang, as Chinese Gov
ernment industrial enterprises which may be mentioned as competing
to some extent with foreign goods in their particular lines, and to
this list might be added other Government enterprises, such as the
Kiangnan Dock &amp; Engineering Works at Shanghai, the Chinese
Government dockyards and arsenals at Foochow and Whampoa,
Government leather factories at Wuchang, Chengtu, Yunnanftu, etc.,
the Government paper mill at Shanghai, the Canton government
paper and printing works at Canton, the Government paper mill at
Isinanfu, and other Government institutions, all of small size, howaver,

The Government salt monopoly may be mentioned, and also the
native wine and native tobacco monopolies, etc., and the agreement
with the Standard Oil Co., of New York, for the joint prospecting
of the petroleum fields of China and possible subsequent joint operation
 thereof.
So far as concerns the activities of the Chinese Government toward
fostering the foreign trade of its manufacturers, little, if anything,
has been done in this line.