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place in the commercial life of the Far East. In November, 1945, the Colony was formally opened to private trading and the total value of foreign trade jumped from HK$12 million in November to $28 million in December. By January, 1946, imports were running at a value in excess of pre-war; exports topped the pre-war level first in March. By the end of the year foreign trade amounted to HK$194 million per month as against the pre-war level of $100 million. Shipping too made as rapid a recovery as could have been expected. British shipping was returned to the area as quickly as possible and every effort was made to resume as soon as possible the provision of normal facilities for the ships of all nations. Port facilities, although in a bad state of repair, were speedily rehabilitated so that by the middle of 1946 turn-round was almost normal. By the end of the year ships entering the port had reached about 40% of the pre-war level and the tonnage of cargo discharged and loaded approached nearer to the normal level.
Industry did not recover quite so quickly owing to lack of raw materials. Matches and rúbber shoes were first in the field as they were able to make a start with raw materials found in stock. Ship-repairing was also re-started without delay. But the biggest single industry cotton weaving and knitting - was largely at a standstill throughout the year as no cotton yarn was available anywhere in the world. The first shipment, of two million pounds, was on its way from Japan in December and the industry seemed ready to resume opera- tions in early 1947, although the all-important question of the level of local costs as compared with world costs was still a matter for conjecture. Trade with Japan was re-opened during the year, but only on a Government to Government basis. Japan supplied coal and piece-goods, and Hong Kong gave food and matrush in exchange. During the year law and order and a stable currency had attracted much business to Hong Kong. Business men had been encouraged to rebuild their concerns and many who had no pre-war interest in the Colony had established themselves and commenced operations. For most of the year it was a sellers' market, but difficulties were by no means absent. As an entrepôt Hong Kong must depend in the long run on prosperity in the markets she serves. Economic instability in China may give a temporary local advantage, but so long as there is political and economic instability in China, Hong Kong's prosperity cannot be secure. Further, war-time scarcities and controls have in the Far East, as elsewhere, denied commercial access to a large sector of pre-war trade, which has either not materialised at all or has remained in Government hands; in a world of controls an entrepôt is something of an anomaly.
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Greater Responsibilities for Local Staff.
In Admiral Harcourt's report on the Military Administra- tion it was written:-
"In those difficult days the Administration relied on its Chinese and Portuguese assistants. Without them the per- sonnel position would have been untenable, and it can hardly be denied that they thereby established credentials which it would be hard for any future Government to ignore."
After the resumption of Civil Government the question of giving wider opportunities for promotion to locally recruited officials came under early consideration and in September, 1946, the Governor, in his address to the Legislative Council during the debate on the Budget for 1946-1947, said:
"The policy of Government is to ensure that every oppor- tunity shall be given to locally recruited persons not only to enter but to rise in the service of the public up to the highest posts and to fulfil the highest responsibilities of which they are capable or can be assisted to become capable."
A beginning has been made in the Medical Department by the promotion of some local officers to grades of Medical Officer, Nursing Sister, and Health Inspector, and in the Education Department to the grade of Master, all these grades having hitherto been confined to non-local officers. Two local engineers have been appointed to the Kowloon-Canton Rail- way. Steps are being taken to recruit local officers for certain technical appointments in the Public Works Department and the first Chinese candidate to be selected for training for the Colonial Administrative Service is now undergoing a course at Oxford University. With the intention of reducing as soon as possible the number of subordinate European officers in the Police Department the number of local officers has been increased. Facilities by way of scholarships in the United Kingdom and elsewhere to enable suitable persons of local domicile to obtain additional qualifi- cations to fit them for higher posts have been made available from Colonial Development and Welfare Funds, in addition to normal Government scholarships. Several such scholarships have already been awarded.
Labour Advisory Board.
The Labour Advisory Board, which had existed before the war, was set up again after the re-occupation on a much wider basis so as to include members of the Services and the Civil Affairs Unit and representatives of the larger European employers of labour. The duties of this Board were to advise Government on labour matters and to negotiate with the representatives of labour when disputes arose. On the resumption of Civil Government the Board was reconstituted on a tripartite basis, its members representing the interests of European and Chinese employers and, for the first time, of Chinese labour. The advice of this Board has been sought