6
11.
for
tel. 974 Sar.
25-141.
(3 ani).
12. for.
tel.1878
21-12-49
(Mt. on 54485/+4)
Mr. Hall (through Mr. Palmer.)
31
There are really two separate issues in this:-
(a) claims by the Hong Kong Government against
the War office in respect of railway materials requisitioned in 1941, and work done by the railway workshops on behalf of the War Office;
(b)
claims by the Chinese Government in respect
of railway materials owned by them but stored in Hong Kong for safe keeping during the Sino-Japanese war, and similarly requisitioned.
2. Both these issues were originally raised in Sir Mark Young's despatch of the 10th April 1947 which is at (5; on 55136/90/47. Desultory discussion of both has continued ever since that date, the latest position being set out in our savingram at (3) hereon, to which the present savingram is the reply.
3. In respect of (a), Hong Kong accept the war Office offer, subject to its being regarded as an interim settlement only in two respects
(i)
(ii)
that part of the war Supplies Board claim
which is for a commissi n of 2% of the total value of the Chinese equipment shipped, on account of work done in preparing it for shipment. A final figure for this commission cannot be fixed until the value of the equipment is fixed; War Office have offered 185,847, and on 54460/49 we have sent a telegram suggesting that this offer should be discussed with Mr. Kwok. But this does not seem anything more than a forlorn hope, and it is most likely that the claims will fall into abeyance unless and until the Communist Government stumble upon some record of them. We should see that Hong Kong's claim for commission does not fall equally into abeyance.
Item 3 of the claim in respect of the
railway, for work done by the railway workshops in supplying missing parts for 600 Chinese-owned wagons. The difficulty here is lack of evidence as to the amount of work actually done; War Office maintains most of that which Hong Kong claims to have done was actually done in India, and Hong Kong, as they admit, can produce little evidence to the contrary. War Office have therefore scaled down their claim of £108,000 to £28,650 (representing £3 a ton for the actual work of preparing the equipment for shipment). Hong Kong now propose to accept this offer as a purely interim settlement, at the same time proposing that
50,3