254.
Copy of Telegram sent to Hongkong Chamber of Commerce
4th December, 1929.
-o000o---
Have seen original draft Hongkong Customs Agreement
which appears desirable for following reasons:-
(1)
Reduces smuggling minimum thus removing cause of
continual friction
(2)
Increases value to Chinese of Customs Organisation thus
tending to prolong its existence in present form
(3)
(4)
Fact that interport transhipments do not lose status of
origin should greatly increase entrepot trade
Non-acceptance will inevitably antagonise Chinese and
lead to stringent preventive cordon round Hongkong and
leased territory including removal of Kowloon Customs.
organisation to Shamchun which must very adversely
affect local commercial interests causing irritating delay
British cargo constant friction (stop) Chinese
insistence non-inclusion of British flag clause 5 removes
danger incidents occurring detrimental to amicable
relations and advantages outweigh any precedent created
by non-inclusion besides which inclusion would result
Japanese and other nations demanding similar privileges
under most favoured nation clause which they entitled to
do without granting reciprocal benefits (stop) When
considering apparent inadequacy China's quid pro quo think
essential take into fullest consideration probable out-
come of non-acceptance as per reason 4 (stop) Communi-
cate this to Shanghai (stop) We await your comments
before expressing above views Foreign Colonial Office.