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the period of inactivity which has

lasted in effect for three years.

He states that it is imperative

to proceed with overaue improvements

in the service by introduction of

equipment and regularising and

recruiting establishment.

He

represents that the interests of

Hong Kong are being prejudiced

by the long delay in arriving at a

settlement and therefore proposes

that negotiations with your Company

should be broken off, and that the

Colony shoula proceed to develop its

own service with China in the

interests of local trade, which would be

prejudiced materially by further delay,

and also to develop communications with

the neighbouring Eastern countries which

are almost of equal urgency ana importance.

3. As your Directors are aware,

it has always been the aesire of the

Government

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