In regard to mines, development by the Chinese themselves is urgent, since undeveloped resources tempt the greed of the Great Powers, and development by foreigners makes it possible to keep China enslaved.  It should therefore be enacted that, in future, no sale of mines or of any interest in mines to foreigners, and no loan from foreigners on the security of mines, will be recognized as legally valid.  In view of extra-territoriality, it will be difficult to induce foreigners to accept such legislation, and Consular Courts will not readily admit its validity.  But, as the example of extra-territoriality in Japan shows, such matters depend upon the national strength; if the Powers fear China, they will recognize the validity of Chinese legislation, but if not, not.  In view of the need of rapid development of mining by Chinese, it would probably be unwise to nationalize all mines here and now.  It would be better to provide every possible encouragement to genuinely Chinese private enterprise, and to offer the assistance of geological and mining experts, etc.  The Government should, however, retain the right (a) to buy out any mining concern at a fair valuation; (b) to work minerals itself in cases where the private owners fail to do so, in spite of expert opinion in favour of their being worked.  These powers should be widely exercised, and as soon as mining has reached the point compatible with national security, the mines should be all nationalized, except where, as at Tayeh, diplomatic agreements stand in the way.  It is clear that the Tayeh mines must be recovered by China as soon as opportunity offers, but when or how that will be it is as yet impossible to say.  Of course I have been assuming an orderly government established in China, but without that nothing vigorous can be done to repel foreign aggression.  This is a point to which, along with other general questions connected with the industrializing of China, I shall return in my last chapter.

It is said by Europeans who have business experience in China that the Chinese are not good at managing large joint-stock companies, such as modern industry requires.  As everyone knows, they are proverbially honest in business, in spite of the corruption of their politics.  But their successful businesses—­so one gathers—­do not usually extend beyond a single family; and even they are apt to come to grief sooner or later through nepotism.  This is what Europeans say; I cannot speak from my own knowledge.  But I am convinced that modern education is very quickly changing this state of affairs, which was connected with Confucianism and the family ethic.  Many Chinese have been trained in business methods in America; there are Colleges of Commerce at Woosung and other places; and the patriotism of Young China has led men of the highest education to devote themselves to industrial development.  The Chinese are no doubt, by temperament and tradition, more suited to commerce than to industry,