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endeavour to misuse it for the purpose of destroying British

treaty-rights. They may usurp tariff autonomy and then call upon the Foreign Inspectorate to assist them in enforcing the collection of illegal customs duties by a fiscal blockade of Hong Kong similar to that instituted by the

Hoppo between 1868 and 1887. This threat has in fact been made already in the manner described in my secret despatch of the 9th August. I earnestly hope that, if an attempt is made

to put this threat into execution, His Majesty's Government

will at once take forcible steps to prevent such an outrage.

But, if this is not done, it will be necessary for this

Government immediately to suspend all activities of the

Chinese Maritime Customs at the Kowloon terminus of the

Kowloon-Canton Railway and to require the complete removal

from Hong Kong of the staff of the Foreign Inspectorate, now

stationed here, as well as the closure of its Hong Kong

office. Obviously the officials engaged in directing a fiscal

blockade of the Colony could not be allowed to have their

headquarters in Hong Kong itself.

15.

I need hardly say how much I should deplore

being driven to take this action. The proper course beyond all question is for His Lajesty's Government to defend

British treaty-rights in respect of the tariff and to prevent

the disintegration of the Chinese Maritime Customs, in which

case the dangers to Hong Kong which I have indicated would

be obviated. The wish nearest my heart is to re-establish

relations between Hong Kong and Canton on the old friendly

footing. But it has been difficult - almost impossible

to make any progress towards such a reconciliation, because

His Majesty's Government will not yet accept the fact that

China

Chiness.

ILicensils.

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