286
[This Document is the Property of His Britannic Majesty's Government.]
C.0.
OPIUM.
CONFIDENTIAL.
(41553)
37169
REC2
REG 25 NOV 12
No. 1.
[October 4.]
SECTION 1.
Messrs. E. D. and Messrs. D. Sassoon and Co. to Foreign Office.-(Received October 4.)
Sir,
17, St. Helen's Place, London, October 3, 1912.
WE have the honour to acknowledge receipt of your letter of the 1st instant. We are pleased to learn that energetic measures are being taken with regard to the destruction of Indian opium by the Chinese provincial authorities, and we trust that this action will have the effect of making China adhere more closely to her treaty obligations.
With regard to the Canton proclamation as to the non-renewal of smokers' licences after the end of this year, we note that His Majesty's Minister at Peking is being asked for a report, We trust, however, that this important matter may not be lost sight of, as if carried into effect it will effectually close the outlet for Indian opium in the south.
We beg to thank you for the information regarding the Bill introduced into the National Council relating to the entire suppression of the opium traffic, and note that it was referred back to the committee for revision and will be discussed again later on by the National Council. Before any such Bill is passed we beg leave to urge the necessity for His Majesty's Government to insist upon adequate time being allowed for stocks in Hong Kong and Shanghai to be sold and delivered to the Chinese dealers, who, however, will only pay for and take up their bargains if they are assured that they can do so in safety.
If the Chinese Government cannot he prevailed upon to allow sufficient time for clearing off the stocks, we beg to suggest that arrangements should be made for China to take over the entire stock at a fair price.
On a previous occasion we had the honour to direct your attention to the extensive smuggling of uncertificated opium into China from Macao. The protest then lodged with the Portuguese Government by His Majesty's Government appeared at first to have the desired effect, as the Macao farmer ceased boiling in the early part of June, and in consequence deliveries of certificated opium improved considerably. In July, however, the Macao farmer received a large shipment from Calcutta, resumed boiling, and smuggling recommenced. The immediate effect of this was the falling off in deliveries of certificated.
Further large shipments have since reached Macao from Calcutta, the total receipts for the first eight months of the year amounting to about 1,300 chests, as far as can be ascertained.
The local requirements being less than 200 chests per annum, practically the whole of the opium imported into Macao is smuggled into China, thus seriously affecting the deliveries of certificated owing to the large difference in price between certificated and uncertificated opium.
At the end of August the price of opium certified for China was 5,550 rupees, while uncertificated was 1,850 rupees a difference of 3,700 rupees, equal to 2,500 dollars. To this has to be added the duty and li-kin of 650 dollars, which is evaded by the smugglers, making a total difference of 3,150 dollars per chest. It is obvious that with an initial advantage of 3,150 dollars per chest the smugglers are in a position to overcome all obstacles in getting their opium into China on a wholesale basis
It is clear that Portugal, a signatory to The Hague Convention, should be urged to observe her part of the agreement and take such steps as will effectually put an end at once to smuggling from Macao into China. France has closed the port of Kwan Chao Wan to this illicit traffic, and Portugal should be pressed to do the same with Macao, it being impossible to reduce stocks in Hong Kong, or induce dealers to take delivery of opium already sold, while such extensive smuggling prevails.
British trade, already sufficiently handicapped by the restrictions imposed by the Chinese provincial authorities, will, we hope, be protected by His Majesty's Government from this further menace by vigorous representations to Portugal.
[2660 d--1]
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