2
Ref.:
CO 537/1374
THE NATIONAL ARCHIVES
1
Ins
restrictions. Further information is given in the enclosed Terms and Conditions of supply of National Archives' leaflet Please note that this copy is supplied subject to the National Archives' terms and conditions and that your use of it may be subject to copyright
legg
00072
7/46
&
To:
The Secretary of State for the Colonies
From: The Governor, Hong Kong
SECRET
Date:
30th September 1946
No:
2/4 (15/2524/45)
31
72
RECEIVED 15 OCT 196
C. O. BEGI
1
2
cms
Ref.:
THE NATIONAL ARCHIVES
CO 537/1374
restrictions. Further information is given in the enclosed Terms and Conditions of supply of National Archives' leaflet Please note that this copy is supplied subject to the National Archives' terms and conditions and that your use of it may be subject to copyright
SAVING TELEGRAM
124
Your Telegram No. 734 Debtor-Creditor Relationships. Matter has been discussed with Morse at considerable length. One point which has not perhaps been sufficiently emphasised hitherto is that any proposal to give value to Yen payments would only benefit about 1/5th of the Debtors consisting entirely of Chinese and a few neutrals. It would not benefit any allied nationals or those Chinese and neutral residents who refrained from taking advantage of the position and who retained their military yen until they became worthless. The figures show that 124 Chinese accounts totalling 12 million dollars were paid off while 44 totalling 8 million dollars were not. Of accounts belonging to other nationals only 39 totalling 6 million dollars were paid off while 342 totalling 57 million dollars were not. The firms who paid off their overdrafts were generally speaking those who were doing good business during the Japanese occupation and in most cases they were deliberately gambling on the possibility of a Japanese victory. Most of them had been pressed for years before the war to pay off these overdrafts but only when the opportunity arose to pay in depreciated yen did they do so. Moreover some of the larger overdrafts paid off had only been agreed to by the Bank with considerable reluctance on representations from the Government. A case in point is that of the Sincere Company who paid off 44 million dollars which was the balance of an overdraft of 6 million dollars, arranged in 1936 on representations from the Government in order to avert a bankruptcy which might have had serious consequences to Hong Kong's commerce generally. Strenuous efforts between 1936 and 1941 to have this overdraft reduced had only resulted in the payment of
million dollars. There is therefore some substance in the Banks' contention that the proposals outlined in your Telegram No. 637 would benefit a class of persons who are not particularly deserving of any special treatment.
2. Morse states that none of those who paid off have alleged that they did so under duress and it is clear that one person at least applied to liquidator for permission to do so. No evidence has come to light during the course of the year since the Colony was liberated which supports the suggestion that persons with overdrafts were subjected to any serious pressure to pay them off except in a few cases where the property
/securing
2
ins