A coalition of European powers, Russia, Germany, and France--England refused to join--decided that it would never do to let Japan possess Port Arthur, and forced her to accept a money payment instead.

So it was restored to China--for the moment; and at the same time a republic was declared in Formosa; but of this the Japanese made short work.
[I once read the memoirs of a Japanese foreign minister from this period.

He didn't think much of most of the Chinese diplomats, whom he considered completely untrustworthy .-- JB.] The following year was marked by an unusual display of initiative on the part of the Emperor, who now ordered the introduction of railways; but in 1897 complications with foreign powers rather gave a check to these aspirations.

Two German Catholic priests were murdered, and as a punitive measure Germany seized Kiaochow in Shantung; while in 1898 Russia "leased" Port Arthur, and as a counterblast, England thought it advisable to "lease" Wei-hai-wai.

So soon as the Manchu court had recovered from the shock of these events, and had resumed its normal state of torpor, it was rudely shaken from within by a series of edicts which peremptorily commanded certain reforms of a most far-reaching description.