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So much as regards the general conditions of the Trade of the Colony which evidence the grave misrepresentations contained in the Nottingham address, but in order to show conclusively, by official returns ou matters of fact, the groundlessness of the specific accusations made by Sir Jonn POPE HENNESSY, your attention is invited to the annexed copies of corre- spondence, with its enclosures, between the Colonial Government and the Committee of this Chamber.

In response to the request of the Committee, the Acting Colonial Secretary under the direction of His Excellency the Administrator has furnished the Chamber with the following documents, viz. :----

1. Extract from a Report by the Colonial Treasurer and Registrar General upon the

Opium Trade of the Colony.

2. Return from the Harbour Master, showing the character of the native vessels engaged in Opium Smuggling and the number of cases of alleged smuggling brought before the Marine Court since April, 1877.

3. Return from the Captain Superintendent of Police, showing the total number of attacks and seizures made by Customs Revenue Cruisers in the neighbourhood of the Colony and reported to the Police since 1st January, 1877.

The Colonial Treasurer's Report on the Opium Trade for 1876, confirms the figures of the approximate estimate made by this Chamber from independent sources and given above, as to the probable quantity of Opium smuggled into China from this Colony.

The Harbour Master's Return shows that there is no special class of vessels fitted out in the Colony and heavily armed for the purpose of Opium smuggling, as alleged by Governor HENNESSY, and in the 5 cases cited in the report which comprise the whole number brought before the Marine Court in the course of five years, it will be seen that the quantity of Opium found in the vessels charged with being engaged in illicit trade was so inconsiderable, as to make it obvious that the concealment of Opium took place in each case in an ordinary trading junk. It is also clear from this Return, that nothing is known in the Harbour Master's Department of the armed organisation for the purpose of Opium smuggling which is stated by Governor HENNESSY to carry on a chronic war with the Empire of China.

The return from the Captain Superintendent of Police dealing with the entire number of cases reported to the Police Authorities during the years 1878 to 1882 (inclusive) of seizures by Chinese Revenue Cruisers and affrays between the Cruisers and Native vessels on the neighbouring China Coast, is instructive.

The number of cases is 23, but of these only 6 are reported to be connected with the Opium Trade and the value of the Opium seized varies from $3 in one case to the maximum amount in another of $800, showing, in confirmation of the Report by the Harbour Master to a similar effect, the comparatively unimportant character of the Opium smuggling which prevails in these waters, and the absurdity of the allegation that there is a large contraband trade conducted in heavily armed junks fitted for the purpose in this harbour.

The remaining 17 cases of seizures by Revenue Cruisers during 5 years do not appear by the returns to have been connected with Opium; 7 of them were Salt junks, 1 Sulphur and Saltpetre, 3 General cargo and 2 Sugar. In 4 cases the particulars of cargoes are not stated.

The return shows the numbers of casualties with fatal results reported to the Police as having occurred in affrays between Native vessels and the Revenue Cruisers during the period of five years under review. Such casualties have been 8 in number, but not one of them appears to have had any connection with Opium smuggling, or to have arisen out of any case of contraband trading with which this Colony was concerned.

In August 1878, a fisherman on the Hongkong shore was accidentally killed by a shot fired by a Revenue Cruiser when pursuing a junk ultimately seized for some breach of Chinese regulations with general cargo on board.

Salt.

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In May 1879, 3 men of a Revenue Cruiser were killed in an affray with a junk carrying As Salt is not produced or prepared in this Island, this affray was not generated in the Colony or within Colonial waters. The preparation of Salt in China is conducted as a very strict monopoly by means of Government licenses, and trade in it other than by duly authorized persons is contraband.

Serious affrays between Salt smugglers and Revenue Officers are well-known to be common throughout the Empire, they are frequently alluded to in the Peking Gazette, and in the case referred to in the Police Report, the junk must have been passing from one part of the territory of China to another part outside British waters.

On 28th November 1881, a man was killed in a boat which was conveying two gentle- men of this Colony who were returning from a shooting expedition on the mainland. Passing by a Customs Station on the Chinese side of the channel the boat was ordered to heave to, not doing so promptly musket shots were fired at it and one of the crew was most unfortunately killed. In this case, there appears to have been no smuggling attempted.

In April this year a man was killed on board a rowing boat in the narrow channel separating Hongkong from the mainland, and in June last 2 men were killed outside British waters in a trading junk carrying Sulphur and Saltpetre which are contraband articles of trade in China. In neither case does it appear that Opium was concerned.

With reference, therefore, to Sir JOHN POPE HENNESSY's allegations which were to the following effect:--

a. That this Island is the base of operations for a class of desperate men who carry on

a large contraband trade in Opium with China,

b. That, for the purpose of carrying on that trade, junks heavily armed with cannon are

fitted out here and wage a chronic war with the neighbouring Empire,

c. That these junks engage, within sight of the Island, in naval battles with the Chinese

Revenue Cruisers resulting in large loss of life on both sides,

the facts are:--

a. There is no large contraband trade in Opium carried on between this Colony and the China Coast. On the contrary the Opium smuggled, considering the extent of the trade, is inconsiderable and for the most part is carried into China in small quantities, portable and easily concealed, just as parcels of tobacco are smuggled into the United Kingdom.

b. That within the knowledge of the Harbour Master and the Colonial Police Authorities no armed junks have been fitted out in this harbour during the last five years for the purpose of Opium smuggling. Smuggling of Opium, when attempted at all otherwise than by passengers in the various steamers trading to the Coast of China, is carried on in ordinary trading junks or in rowing boats dependent for success in their illicit trade upon their swiftness and small size.

c. No such contests as those referred to in allegation c. have taken place within the last

five years,

and no loss of life in connection with Opium smuggling during the same period has come under the notice of the Police. Any serious affrays attended with loss of life which have occurred in the neighbourhood of this Colony between Native vessels and Revenue Cruisers, have been in connection with contraband traffic in other articles on the adjacent China Coast with which, so far as is known, this Colony has had no concern. The only instance reported by the Police in which Revenue Officers have been injured, was the case of the Salt junk referred to above and shown to be a purely Chinese affair.

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