have applied for leave to act.

In spite of the discouragement

afforded by the Supplementary Treaty, the Chinese Trade appears to be rather on the increase, and

Q

I have the honor to append to this Report Paper by Mr Gutzlaff, on that interesting subject . The total absence of a Custom-House, affording the regular and exact returns connected with such an Establishment, while it encourages Frade by holding out the advantages of a Free Port; at the same time renders it impossible to give a very accurate statement of the Commerce carried on. The principal English firm, that of Sardine, and Matheson, is chiefly engaged in the smuggling of Opium along the Coast, and

smuggling Frade is also carried.

on in Salt,

a

which is prohibited to Foreigners

as an inport.

as well as

A surprising increase, insprovement has taken place during the last year in the Chinese Shops. The Colonial

Almanac,

it 2.

228

Almanae, of which I have directed two copies

to be forwarded, contains a List of three hundred and eighty eight Retail Dealers, in addition to the three Government Markets.

A principal obstacle to the Chinese Commerce of the place is the system of Pracy

which infests the approaches from the bast and West; but measures which are now in progress for checking this, (and which shall be reported hereafter), will I treest have a tendency to remedy the evil. Any local measures would be uselo's previous to the receipt of the tice Admiralty Commission, which is daily expected by the Mail Steamer:

My previous Despatches, will have shown that the small quantity of level land available in the Colony for agriculture must always restrict this branch of productive -industry within narrow bounds; but the few vallies which are to be found with probably

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