Mr. Grosvenor to Earl Granville.―(Received January 16, 1883)

(No. 140 Most Confidential)
Peking, November 25, 1882

My Lord,

RUMOURS have from some little time past been current that M. von Möllendorff, a German, had entered into an arrangement with the Corean Envoys, lately in China to serve the Corean Government as foreign adviser. These rumours have now received confirmation.
M. von Möllendorff's career in China has, up to the present, been short but checquered. He came out in 1871 as an employé of the Foreign Customs Service, left that Service in 1874, and was subsequently employed as Interpreter to the German Consulate at Tien-tsin. He left the German service in the course of last year, and has, up to the present, served as one of the many foreign employés in the suite of his Excellency Li Hung-chang.
Mr. Brenan, Acting Consul at Tien-tsin, had some few days ago an opportunity of reading rapidly the agreement in Chinese that has been drawn up between M. von Möllendorff and the Corean Government. Mr. Brenan informs me that the gist of the agreement is as follows:-
M. von Möllendorff agrees to go to Corea to assist the Government in its foreign relations. His former experience in the Chinese Customs will enable him to assist the Coreans in establishing a foreign Customs system. If the Corean Government, or any Chinese Deputy sent to assist the Corean Government, gives him orders with regard to Customs matters, or directs him to proceed to any port, he must obey. He will at first find it necessary to employ foreign subordinates, but they must only be employed from year to year, so that they may gradually make way for Coreans, as these learn that work. At first the Customs revenue will be insufficient to pay expenses, so a certain sum will be allowed from some other source to carry on the service. M. von Möllendorff must not, however, incur any expense without the sanction of the Corean Government. When the Customs revenue, after a year or two, becomes considerable, a certain sum out of this will be set aside for the purpose of these expenses. M. von Möllendorff is to receive [300 taels (circa80)] a-month. He will, besides, be allowed quarters. His agreement is terminable all three months’ notice on either side.
Some surprise has been felt and expressed in Peking that the organization of the Corean Foreign Customs was not intrusted to Sir Robert Hart, who has rendered such valuable services to the Chinese Government in this direction, as it is well known that his Excellency Li Hung-chang is the motive power in all matters concerning the relations of Corea to foreign powers. His Excellency’s action in this matter, as will be seen further on, appears to have been in opposition to Sir R. Hart’s.
A few days after Mr. Brenan had sent me the precis of the arrangement concluded between M. von Möllendorff and the Corean Government, he had a conversation with M. von Möllendorff on the subject of the latter’s appointment, in Corea. M. von Möllendorff, stated that Sir Robert Hart began, as soon as he had the opportunity, to offer his assistance in organizing the Corean Customs Service, and suggested to the Tsung-li Yanem that the Corean Customs should be incorporated with the Chinese. The Yamen demurred to this arrangement because it would place Corea in the position of a Chinese province. Sir Robert Hart then, according to M. von Möllendorff, proposed some scheme whereby Corea should have a separate establishment under Sir Robert Hart’s supervision. His Excellency Li Hung-chang had, in the meanwhile, made other suggestions to the Corean Envoys, one of which was that M. von Möllendorff should become their adviser on foreign affairs, with a special view to assist them in establishing a Foreign Customs Service. His Excellency Li is stated by M. von Möllendorff to have placed Sir Robert Hart’s and his own proposal very fairly before the Corean Envoys; to have requested them to return home and explain matters to the King, and to come back to Tien-tsin with their minds made up as to which plan was most acceptable, and also to bring with them full powers to conclude an arrangement on the subject. The Coreans went, returned, and stated their preference for his Excellency Li’s scheme, which has consequently been adopted. M. von Mollendorff went on to say that, previous to the decision of the Corean Envoys, Sir Robert Hart had his plans ready, and had selected two members of the China Foreign Customs staff to commence operations in Corea, and had, moreover, offered the Inspector-Generalship of Corean Customs to Mr. Cartwright, an Englishman who has just resigned the post of Commissioner of Chinese Customs. Mr. Cartwright, however, declined the proffered appointment. One of the gentlemen whom Sir Robert Hart meant to send to Corea has just been appointed to serve in the Inspectorate here. His name is Carral.
I cannot help feeling that the Coreans have made a great mistake in accepting His Excellency Li’s nominee as a foreign adviser with the mission of organizing their Customs Service. Whilst crediting M. von Möllendorff, who is almost an entire stranger to me, with the best intentions, both with regard to foreigners in general and Coreans in particular, I cannot but think that his somewhat spasmodic changes of career since he has been in China, and his relations to His Excellency Li, do not offer the guarantee requisite for so delicate an operation as the establishment of a Foreign Customs Service in a new country. I think that Coreans and foreigners alike would have been much safer in the hands of so experienced and able an organizer as Sir Robert Hart, and I am sure that no Customs official in China would have performed the duties for which he was intended by Sir Robert Hart more efficiently than Mr. Cartwright.
Your Lordship will observe in the terms of the agreement given in the earlier portion of this despatch that foreigners are only to be employed temporarily in the Corean Customs Service. In order to enable the Coreans to learn English, of which they must necessarily know something in order to become Customs officials, M. von Möllendorff is taking over to Corea with him six of the Chinese youths who have completed their course of study in America.
M. von Möllendorff spoke to Mr. Brenan of his decided intention of pushing the Coreans to develop the resources of their country in the way of mines, manufactures and other industrial enterprises, and stated, moreover, that the Coreans were, in his opinion, ready to go in for anything that promised future wealth. As M. von Möllendorff has lately seen a great deal of the Corean Envoy, his opinion on this point is worth consideration.
The impression which M. von Möllendorff left upon Mr. Brenan was that he counted upon English support a good deal for the success of his new enterprise, and that he hoped to induce English capitalists to invest money in Corea.
M. von Möllendorff went on to say that he could not hope for much support from his former chief, M. von Brandt, from whom he parted, on leaving the German service, on terms the reverse of friendly; and he did not expect Sir Robert Hart would view his proceedings very favourably. In both these forecasts I should say that his view is correct.

I have, &c.
(Signed) T.G. GROSVENOR