Hong Kong Reparation Association
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Deptartante! рефеё перву
Thank you for your letter of 13 September about reparations for currency issued during the Japanese Occupation the Second World War.
Let me say first of all, that this Government greatly sympathises with the hardship and losses suffered by Hong Kong citizens during the Japanese occupation. The behaviour of the Japanese forces in the countries they occupied was horrendous.
However, as you are aware, a Treaty of Peace with Japan was signed by the United Kingdom and other Allied Powers in San Francisco in 1951. The UK's ratification of the Treaty bound Hong Kong as well as other parts of the UK. In many countries in South-East Asia occupied by the Japanese there were large amounts of Japanese currency in circulation by the end of the war. The question of this currency was considered before the ending of hostilities when decisions were being made about the re-establishment of British administration in the then British colonies in South-East Asia. It was decided that no value whatever should be given to Japanese currency or to any local currencies introduced under the Japanese occupation. Among the reasons for this was the fear that giving any value to this currency would expose British currency to heavy inflationary pressures as very large amounts of currency had been circulated by the Japanese. Non-recognition would also discredit Japanese currency, in areas still occupied by the Japanese, as doubts would arise about how long Japan would be able to maintain its control. This policy was accepted and enforced, in most places, with little difficulty when hostilities ceased. In Hong Kong the Japanese yen was recognised for a short period before Hong Kong dollars became available. Hong Kong dollars arrived on 11 September 1945 and the Japanese yen was demonetised on 13 September 1945.
In your letter you refer to compensation agreements in other South-East Asian countries. Our information is that no such agreements were enacted. In Burma, Malaya and the Philippines, as well as in Hong Kong, there was no redemption of Japanese currency. In Indonesia there was exchange of yen for legal tender at a very low rate until March 1946 when Dutch gilders were reintroduced.
MT1ACJ
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