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SECRET.

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+ 4 bennes.

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Hong Kong.

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Factual Background.

1. Hong Kong at the time of its cession to Great Britain

by the Treaty of Nanking a hundred years ago, was a desolate

island with no inhabitants except a few groups of fishermen.

It has grown under the direction of the British Government

to be one of the great sea ports of the world based upon

British law and order and on the enterprise of all peoples

and nations alike.

2.

The British policy has been and will continue to be that

Hong Kong should be a free port for the services of all

trade and commerce in the Far East. Hong Kong is the depôt

for an incessant flow of people and goods in and out of

China. Of the population of nearly a million residents which

it had attained, all had freely come in of their own choice

or were the children of immigrants who had done so.

If any

prefer to live under Chinese rule there is no let or hindrance

to their moving over the border for the purpose.

3. It was a centre of settled and orderly conditions for

the benefit of all countries having relations with China

throughout the prolonged era of revolutionary disturbance in

South China.

4. When the Japanese overran Shanghai and South China the

Colony was for 3 years up to December 1941 able to serve as

a channel of supplies to China and a refuge for hundreds of

thousands of displaced and largely destitute Chinese people,

and for numbers of foreign nationals in China.

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5. /

The following is an extract from the Colonial Office list: "Hong Kong is a free port except for an import tariff on all intoxicating liquors, on spirituous liquors containing more than 2% of pure alcohol by weight, on tobacco, and on hydro-carbon oils (including motor spirit), and on motor vehicles not of British Empire origin. There is no export tariff."

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