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DISTRIBUTION OF THIS MESSAGE IS TO BE LIMITED TO THOSE OFFICERS WHO ARE CONCERNED WITH ITS CONTENTS
TOP SECRET 7545 IN
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jh
211236 September
FROM: C. in C. Hong Kong. DATE: 23.9.45.
RECD:
1548
C.C.M. F.O. (SEC.) BY W/T
ADDRESSED: War Office.
IMPORTANT
For Civil Affairs and Colonial Office.
1. Replacement of Yen currency by Hong Kong dollars has proceeded without incident or as yet recourse to free feeding of the population.
2. Proposo demonetising Yon as from Tuesday 25th September.
3. Total new currency issued two and throe quarter million on basis? of 200 dollars to bank customers and ten days wage requirements to essential services ?employers including Government.
4. Facilities now arranged for changing notes of large denominations. Amount of hoarded notes reappearing is unknown but must be considerable.
5. There are continued difficulties in circulation. Rice is` subsidized and controlled at 20 cents a catty but firewood, peanut oil and other essential supplies uncertain and prices erratic and high. Increasing difficulty of maintaining basic wage of one dollar a day.
6. Trade loan will probably ultimately be necessary to finance reconstruction but immediate need is to finance local trade through small businesses which lack bank facilities. Recommend I be authorised to make loan to be administered by Chinese Chamber of Commerce or other approved organisation up to one
Advances over repetition one million dollars.
10,000 dollars to require approval of CFA.
7. Am advised this is necessary to start business stalled for lack of ready cash. Hope that banks may resume normal business when American and more European staffs arrive but banks would be reluctant to advance money for the purpose envisaged for the loan and Government intervention and assistance is essential.
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