At the turn of the 19th – 20th century, three of the BNP Paribas Group’s forerunner banks arranged financing for one of the largest public works projects of the age: the construction of the Peking to Hankow (modern-day Beijing to Hankou) railway, a distance of 1,200 kilometres.
A technical feat and an economic success
The Chinese were highly suspicious of the imperialist ambitions of France, Great Britain, the United States and Japan, but needed access to Western technology and sources of finance, so in 1896 they turned to the Belgian financial and industrial group Société générale de Belgique. However, Société générale de Belgique came to an agreement with Banque de Paris et des Pays-Bas in 1897, with a view to sharing the risks and obtaining access to the pool of French savings. The Comptoir national d’escompte de Paris also came on board the project.
Supervision of the construction of the railway line was entrusted to the Belgian engineer Jean Jadot. Construction works began in 1899, and the line was officially opened in 1905. In the meantime however the project faced all kinds of difficulties, including the 1900 Boxer Rebellion, which meant that on-site staff had to be armed; and the Yellow River – the main natural obstacle along the route – over which they had to build a 3,010-metre-long bridge.
The Peking-Hankow railroad proved to be a great success both for its investors and for the Chinese authorities. It soon became the most profitable railway in the world. In fact, the flow of profits from the line enabled the Chinese government to buy back in 1909 the concession they had granted to the operating company.
Some of those involved with Peking-Hankow
It was Paul Claudel, then French consul in Shanghai and subsequently vice-consul à Fuzhou (Fu-chou), who took charge of the negotiations, assisted by his friend Émile Franqui, the Belgian consul in Hankou. Henri Cernuschi, founder of the Banque de Paris, had himself seen the Grand Canal clogged up with mud during his visit to the Far East. Empress Cixi of China consented to try out the railway for the first time in January 1902, travelling along part of the line that had already been built, in the company of Jean Jadot. French naval doctor and ethnographer Victor Segalen was also a passenger on the line during his stay in China.