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In this connexion it is of great interest to note that on June 10, 1898, acting
under instructions from H.M.G. in connexion with the negoti- ations for the Hongkong Exten- sion Agreement, Sir Claude MacDonald assured the Taung Li Yamen that as soon as the leased territory was handed over the Hongkong Government would take all possible pre- cautions to prevent it from being used to facilitate smuggling into China or in any other way detrimental to Chinese interests (p.187 China Blue Book No. 1 of 1899). Later, Sir C. Mac- Donald asked Sir R. Hart to state what arrangements the Customs would propose to safeguard the revenue inter- ests of China, and Sir R. Hart replied stating his requirements categorically (1b1d.p.201). The main
item of these requirements was that the Customs should be allowed to function in Hongkong, and their cruisers allowed to patrol Hongkong waters, just as is desired now. These requests were apposed vigo- rously by the commercial bodies (ibid p.295-298) and not acceded to. A copy of Sir R.Hart's letter is annexed to this meno. (See also Sir C.Clementi's account of the history of the fiscal blockade attached, next section).
of the handing over of the New Territory
to the Hongkong Government in 1899, in
accordance with the terms of the convention
of 1898, for the Extension of Hongkong,
these four stations - with the temporary
exception of Kowloon - were closed, and
new stations were established at various
distant points along the new frontier,
while the Chinese waters, outside the
British area, were patrolled by the Customs
Revenue cruisers. In 1910 the Commission-
er of Customs for Kowloon, Mr.A.H.Harris,
with a view principally to checking the
considerable loss of revenue on salt, be-
gan moving for an agreement with the Hong-
kong Government, by which the Customs
would be allowed to function much more
extensively in the Colony, and he suc-
ceeded in drawing up an agreement which
was acceptable to the Hongkong Govern-
ment, offering certain concessions in re-
gard to goods transiting Hongkong, and
rights of inland navigation, in return
for control of salt smuggling, establish-
ment of Customs offices in the colony,
etc. The Hongkong Government at that
time (1910-11) looked upon the negotiation
of this agreement which they thought the
Chinese desired, as a lever for getting
what they wanted (1.e. joint management)
in the Canton-Kowloon Railway Working
Agreement, over which the Chinese were
on the other hand making difficulties.
/In
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