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The industrial development of China should be carried out along two lines: (1) by private enterprise and (2) by national undertaking. All matters that can be and are better carried out by private enterprise should be left to private hands which should be encouraged and fully protected by liberal laws. And in order to facilitate the industrial development by private enterprise in China, the hitherto suicidal internal taxes must be abolished, the cumbersome currency must be reformed, the various kinds of official obstacles must be removed, and transportation facilities must be provided. All matters that cannot be taken up by private concerns and those that possess monopolistic character should be taken up as national undertakings. It is for this latter line of development that we are here endeavoring to deal with. In this national undertaking, foreign capital have to be invited, foreign experts and organizers have to be enlisted, and gigantic methods have to be adopted. The property thus created will be state owned and will be managed for the benefit of the whole nation. During the construction and the operation of each of these national undertakings, before its capital and interest are fully repaid, it will be managed and supervised by foreign experts under Chinese employment. As one of their obligations, these foreign experts have to undertake the training of Chinese assistants to take their places in the future. When the capital and interest of each undertaking are paid off, the Chinese Government will have the option to employ either foreigners or Chinese to manage the concern as it thinks fit.
Before entering into the details of this International development scheme, four principles have to be considered:
(1) The most remunerative field must be selected in order to attract foreign capital.
(2) The most urgent needs of the nation must be met.
(3) The lines of least resistance must be followed.
(4) The most suitable positions must be chosen.
In conformity with the above principles, I formulate P ROGRAM I as follows:
I. The construction of a great Northern Port on the Gulf of Pechihli.
II. The building of a system of railways from the Great Northern Port to the Northwestern extremity of China.
III. The Colonization of Mongolia a nd Sinkiang (Chinese Turkestan [1] ).