247
38.
F. 0.No.89 of Jan 21, 1930 (p.11 in 5Y)
on the whole question as then brought to their notice.
The gist of their criticisms on the latest Hongkong
draft of November last may be summarised as follows.
The deletion of the salt provisions of Article 2 may
have destroyed one of the strongest Chinese incen-
tives to conclude the agreement (see history of the
question above). The amendments to Article 5 include
the deletion of the clause as to free carriage of
mail matter, to which the Chinese probably attach
importance, while the restriction of the inland water
privileges to the two Kwang provinces is of little
account in practice, but may lend colour to the
theory that China is divided into regional govern-
ments. The re-draft of Article 9 omits the stipu-
lations for bonded warehouses (to which the Board
of Trade attaches importance A.H.G.), and appears
to involve other substantial alterations. It is
difficult to see how the Chinese can be expected to
give privileged treatment to Hongkong manufactures.
It is however not possible to form an opinion as to
these various amendments till Mr. Maze has expressed
his views. The Governor's argument that Hongkong
Chinese favour insistence on inland water privileges
for British-flag vessels under Article 5 may have
we ight locally, but ignores the consideration that
the protection of the British flag in China is the
responsibility of His Majesty's Government and not
of Hongkong, and that it is undesirable to have
a large increase in the mmber of Chinese-owned
vessels under the British flag in the inland waters
of China. Sir Miles Lampson's opinion is quoted
to the effect that the agreement would be beneficial
even without Article 5 or 6 (corollary to 5), or
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