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Kong and Macao to be thorns in our side, and have had no sympathy with the outcry against the "blockade." Still, I acknowledge there is a higher point of view: commerce is a grand civilizer, and ought to be carefully encouraged wherever it shows any dispo- sition to take root. Hong Kong has really useful qualities, for not only does it serve as a common meeting place, where East and West can exchange commodities without unfairly taking up each others ground, but, as a British colony, it differs from Treaty ports much as an electric light does from a "farthing dip," and is a point from which Western light might be thrown into the whole of China. The fair claims of the Hong Kong residents for general protection and freedom in their operations ought not to go down before the Chinese fashion of leaving its own work undone and fastening on another's weak point; for, although it may be convenient for the Hoppo to collect revenue round Hong Kong, China's duty is to open her ports and take proper precautions at each. From the higher point of view these and other such conditions suggest; my sympathies, I need hardly tell you, are with the Colony.
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Before 1870 it was the opium smuggling, that is, the loss our properly-accounted-for collection sustained owing to opium being distributed from Hong Kong and Macao instead of from Canton and Swatow, that suggested action-the object of that action was to add
The "blockade the lost opium duties to the Imperial revenue.
began, and has been doing its work so satisfactorily from the Chinese point of view that last year the opium stations were ordered to go a step further and collect duties on the other goods carried to blockade" is now a paying and from Hong Kong and Macao in Chinese bottoms. The but expensive operation for China, and an equally irritating one for the Colony,
faire?" the blockade is internationally, legally, and technically correct.
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The proposal I wanted to make in 1870 was the following :-
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1. Hong Kong Government to authorize Chinese Customs (or rather the Inspectorate
of foreign branch), to place two or more opium hulks in the harbour.
2. Hong Kong Government to order all vessels arriving with opium to go alongside and discharge into opium hulks.
3. Opium thus stored to leave the hulks in one of the following ways:—
(a.) To pay duty if placed on board a Chinese junk or landed otherwise than under bond.
(b.) To be exempt from payment of duty at Hong Kong if placed on board a foreign vessel for a Treaty port, but to give a bond for delivery at that port.
(c.) To be exempt from duty at Hong Kong if taken ashore under bond-the con- ditions of the bond to be:-1, that the opium shall leave by junk or foreign vessel, or enter an opium-preparing house; 2, that leaving by junk it shall pay duty, and by foreign vessel give bond for delivery; and 3, that if taken to a preparing-house (to be prepared for the California market) the special rules yet to be drawn up shall be observed.
You will at once see in how many ways this modus operandi would be preferable to the "blockade," cheaper for China and less irritating for Hong Kong. The plan proposed would exempt foreign-bottom-carried unsold Treaty-port opium from any Hong Kong charge for duty, as is the case now, and would only collect duty from such opium as passing into native hands had found buyers and virtually entered China. All that is obnoxious in connection with the "blockade" would disappear, and a very simple form of bond would be the only addition to the formalities of the trade of the day. Individual liberty would be as great as ever; capital would not be withdrawn by premature taxation; the Colonial Government would not lose in dignity, an entente cordiale would result, and the Customs would have no reason to fear the growth or expansion of the Colony. On the other hand, if the "blockade" continues, its grasp is certain to become tighter and tighter every day; besides, you cannot get rid of the blockade" except by permitting the Customs to collect at Hong Kong.
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The plan would have been feasible in 1870, as far as China is concerned, and I still think it could be introduced; but the Hoppo's Chinese have manipulated the "blockade" accounts during the last five or six years, and would probably make a fight to retain such a paying position.
I cannot think of any simpler or less objectionable plan, unless, indeed, you could induce the Indian Government to collect duty for China at the same time with its own and thus do away at a stroke with all reasons for smuggling along the Chinese
revenue, coast.
Your idea, I see, is to have the collection managed at Hong Kong hy British officials, and I at once grant that your people could do it as well, and would do it as honestly as mine; indeed, with Colonial backing they might do it more efficiently, but whether it be instinct or habit of thought, my feeling is against British collection at Hong Kong, and I should rather have the doing of it myself. The Convention between England and
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France (1815) concerning salt and opium in India is an instance in which one country (France) gave up some of its territorial rights to enable another country to protect its revenues. Hong Kong's position is somewhat analogous, and without loss of dignity, and with certainly good results on all sides. England might help China to protect Chinese revenue by permitting the establishment of a special station in the harbour of Hong Kong.
If you think well of the plan I propose, the most likely way to ensure its introduction would be for the Colonial to move the Foreign Office to instruct the British Representative at Peking to see to it. Local feeling at Canton, especially on the part of those who divide the spoils of the "blockade," would make it impossible for the Governor of Hong Kong to arrange the matter with the Viceroy at Canton. To be successful it must be taken up by Mr. Wade at Peking, where, of course, it will also be supported by me.
The plan above suggested will require very little in the way of elaboration of details, and if introduced at Hong Kong would also be given effect to (either by its introduction or by a "stricter blockade ") at Macao.
Since the Emperor died we have had quiet here; but his bride followed him three weeks ago, and his successor is half killed by the ceremonial, and will probably die too. Poor Margary's death, and the presence of a Japanese Chargé who objects to the receipt of tribute from Len Choo, are now exercising the Tsung-li Yamên. One's consolation in all these tronbles is that China is to such extent a "dog in the manger" that anything wrung from her by the foreigner will be an advance for the Empire and a source of good to its people.
Having written to such length about the Hong Kong question, I shall not weary you with further China gossip. Is it not in the "Mail" and the "Herald," and is it read or cared for by your happy folk at home?
Sir Richard Graves McDonnell, &c. &c. &c.
Believe me, &c. (Signed)
ROBERT HART.
Inclosure 2 in No. 2.
Memorandum by Sir J. Pauncefote on Mr. Hart's proposals, and on the Opium Monopoly of
Hong Kong.
SIR A. KENNEDY, in his despatch of the 25th August, 1874, writes as follows:
24. I am convinced that the shortest, best, and only remedy for disputes and references which have existed for years, endangering our good relations with the Canton Government, is the recognized establishment of a branch of the Chinese Foreign Inspectorate at Hong Kong itself, a course which is at present substantially but clan- destinely practised and acquiesced in by those Chinese merchants residing in this Colony who desire to avoid trouble and the risk of seizure and 'squeezing' by low officials outside the harbour limits.
"25. Even to this course grave objections might be made, and difficulties would doubtless attend any attempt to reconcile the interests of the free port of Hong Kong with those of the adjacent Chinese territory, where duties are levied, and many articles, such as arms, gunpowder, saltpetre, &c., are contraband." (See printed correspondence, p. 6.)
The system to which Sir A. Kennedy refers in paragraph 24 as being "clandestinely practised by Chinese merchants," is no doubt that of purchasing from secret "Customs Agencies" in Hong Kong duty" chops," or receipts, on production of which their vessels pass unmolested (see as to this paragraph 28 of the Report of the Commission, p. 10 of printed corresponence); and this is the very practice which Lord Carnarvon suggested should be carried out openly through a Chinese Consul.
Mr. Hart's scheme will be objected to in the Colony by two classes of opponents. Firstly, by those who believe that the prosperity of Hong Kong depends on the facilities which it affords for smuggling, and who would sooner run the risks of the “blockade" than see a Customs Department established in the Colony for the protection of the Chinese revenue.
Secondly, by those who, while they discountenance smuggling, are opposed to any concession whatever to the Chinese Government, and would regard the establishment in Hong Kong of a special station of the Foreign Inspectorate as an imperium in imperio and a " thin wedge," menacing to the independence of the Colony and the freedom of its trade. The first objection is one which has been already disposed of by Lord Carnarvon's despatch on the "blockade." The second objection is anticipated in Lord Carnarvon's
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