** CONFIDENTIAL.
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Endlosures 1to5.
6 to M
My Lord,
GOVERNMENT HOUSE.
HONGKONG. 10th December, 1919.
With reference to the second paragraph of
Mr. Severn's Confidential Despatch of the 25th September, and the seventh paragraph of his public Despatch No. 308 of the sume date, I have the honour to forward the enclosed copies of correspondence with the Government of Macao and with the Commissioner of Chinese Maritime Customs, stationed at Macao, regarding the "Amherst" opium case.
3.
2.
Under the terms of the Memorandum which
was signed at the Foreign Office on the 17th April, 1913, the farmers of Macao and Hongkong are permitted to import, per annum, respectively, 240 and 120 chests of raw opium ex- -clusively destined for exportation to countries which had not at that date prohibited or which should not subsequently pro- -bibit hereafter such imports of opium, The raw opium so imported is made into prepared opium prior to exportation, although this is not definitely stated in the memorandum.
The Government of Hongkong has never made use of this right of exporting prepared opium, as, apart from other considerations, there is no legitimate market open to receive such opium in any quantity. In the case of Macao it appears to be beyond question that the privilege is being used to cover wholesale smuggling into China and Your Lordship will probably, after perusing this correspondence, share my
opinion HE RIGHT HONOURABLE
VISCOUNT MILNER, G.C.B.,
&c.,
&c...