Rice:
5
72
The Administration is endeavouring to obtain some indication of the figure which the Companies have in mind as a foir rental for it would obviously be unsatisfactory to incur a liability of such a vague and indeterminate nature. This is especially the case as such reports es are available on the condition of the plant at the time of our re-occupation can easily be challenged by the companies, for only a report prepared by a consulting engineer could have any real value.
In the course of the negotiations the Administration has lande it clear that they are not prepared to meet the salaries of members of the staff of the two companies who are at present absent from the Colony on leave. The negotiations are still continuing.
The subridisation of rice to maintain the price at 20 cents a catiy is still being continued. Rice accounts paid by the Treasury for the period 20th September/15th October amounted to 25,416 piculs, costing $1,501,520. or an average cost of 59.1 cents per catty. According to information supplied by the Rice Controller, the average daily consumption amounted to 4,000 riculs, and of these figures it is estimated that the cubsidy Le costing
156,400 & day. This excludes any issue of free rice. There are still outstarcing contracts for 15,445 piculs at varying rates from bb cents to 45 cents A Ontly. Frices ure showing some reduction, for when the subsidy was started, it vay found necossary to pay 65 cents per catty.
Price Level:
Prices are still high, and where iuropean luxury goods are concerned, they are often fantastic. But within the Lake 101 digs prices of foodstuffo have shown a slightly lower trend to the extent of perhaps 6. No real improvement can, however, be locked for until supplies of aji sorta and, particularly sech dormodities as wood for household fuol, charcoal, rice, peanut oil and other similar oils arrive in adequate quantities. This is the pressing necd.
The prosperity of the Colony in the part depended on the fact that it was the recognised distribution centre for South China. It can only resume this role and regain its prosperity when it again possess、adequate stooks, always provided, however, that a satisfactory price level is mintained. Fending the arrival of further supplies which is, of course, the real solution to all our problems, every endeavour must be made to ensure that there is no further rise la prices, and that where possible costs are gradually reduced. To servo as a redistribution centre, Hong Kong must be cheap.
27.10.45.
Chief Financial Adviser.
(Civil Affairs)