PUBLIC RECORD
OFFICE
Reference :-
TEC.O. 882
5 PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO
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lying purpose to render impossible the acceptance of capital requests which it had sp....... peared desirable, for some reason, to prefer.
Grievances which had been, hitherto, in some degree sentimental would then indeed assume a practical form. If the presence of customs stations on the adjacent mainland, and at the entrance to the harbour, and of customs cruisers in the waters surrounding the colony, has been a hindrance and a source of vexation when these territories and waters were Chinese, the annoyance would be less endurable still when they assumed the character of foreign establishments within territory under British control.
Great allowance has been made for the position of Hong Kong, and greater allow- ance still for the inefficiency of Chinese administration. The British Government does very much more for the Chinese fisc than any European Government would do for another Power; and the Chinese Government responds by a degree of intrusion which no European Government would admit. It is no exaggeration to say that the entire native junk trade with the mainland is controlled by the staff attached to the Chinese Customs Office in Hong Kong, for the Colony is supervised by Chinese native employés, while its waters are patrolled by customs armed steam launches, and we may be sure that very little escapes such a system under European supervision. The arrangements made in pursuance of the Chefoo Convention may have minimised the ostensible trouble, but it is open, to contention that the result has been attained at the cost of sacrificing the free- dom of the port. The maintenance of the rule that junks shall not leave their anchorage at Hong Kong after dark may afford another instance in point. Instituted, no doubt, with a view to piracy rather than smuggling, it has nevertheless greatly helped the Chinese Customs Authorities to prevent evasion of the cordon which they have found it easier to draw around the island than along their own coast, and has since the original motive ceased to be cogent-been regarded in the Colony chiefly from that point of view. That Chinese traders and junk owners dislike these conditions is well known. Neither are the reasons which deter them from remonstrance far to seek, when we re- member the methods of Chinese mandarins and the facilities which knowledge acquired in Hong Kong may afford for action on the mainland. Chinese members of the Hong Kong Legislative Council have, however, ventured to, speak freely, under cover of acquired British nationality; and Your Lordship may gather from the annexed com- munication (2) the state of feeling which they have found to exist.
The junk trade between Hong Kong and the mainland is an important distributing medium. If existing arrangements have prejudicially affected it, the intensity of the resentment felt at the prospect of further interference becomes intelligible.
It may be permissible to insist, again, that the Chefoo Convention had two aims, although the second was imperfectly attained. The Chinese revenue has been safe- guarded; but the annoyance from the Canton customs revenue cruisers remains; and the removal of the customs cordon was one of the greatest benefits which the Colony hoped to derive from the extension which it has so long desired.
It is suggested that opium affords the key of the situation. The temptation to smuggle a highly-taxed article, which represents a large value in a small compass, is great, and a good deal of what the Imperial Maritime Customs Authorities call smuggling used, no doubt, to go on. That is to say that, although the opium exported from Hong Kong to the mainland contributed, measurably, to the provincial revenue and to the private incomes of the provincial officials, it failed to benefit the Imperial Exchequer.
There is not, in casting this side-light on the situation, any purpose of deprecating the attitude which Her Majesty's Government saw fit to adopt. It is desirable, how ever, to throw all the facts of the situation into relief, when we encounter ulterior de- mands such as those which the Association is concerned to combat. The practical ques- tion is how willingness to assist a service and a purpose towards which Her Majesty's Government has naturally been sympathetic, can be reconciled with the desire of the Colony to see the Chinese revenue stations and revenue cruisers removed beyond the limits of British territory and British waters.
It has been suggested that this might be accomplished by taking the collection of the opium revenue into our own hands. Hong Kong is rightly jealous of the status as an absolutely free port to which its commercial prosperity is so largely due. The creation of bonded warehouses, and insistence that all opium imported into the Colony shall be deposited therein would be a certain infringement upon that status; but the conve- nience of admitting a foreign preventive service would be immeasurably greater.
That is, then, the solution which is proposed. (3) The Hong Kong Government would presumably, in such case, undertake to collect as an export tax, and hand over to
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the Chinese authorities (after deducting the cost of collection) the recognised amount which the latter ought properly to collect as an import duty on their own soil. The service would be great, and the consideration required should be the complete removal of the Chinese customs and all its accessories beyond British limits.
It would be desirable, as a corollary, that the proposed boundary line of the new concession should be rectified. That which has been indicated appears arbitrary and unsatisfactory, in that it presents no natural division; whereas a good natural frontier exists in a range of hills a little farther to the north. The extension would be slight, and the change would be an advantage to the Chinese not less than to ourselves, as passes through hills can be more easily protected against smugglers than the open frontier which was at first proposed. The terms of the Convention appear sufficiently elastic to permit the rectification as a logical consequence of surveys which have, pre- sumably, for their object to ascertain the line along which a boundary can be most. con- veniently drawn.
It would be desirable also, as a second precaution, to cease to recognise the customs revenue cruisers as men-of-war, as it is in that capacity that they haunt the waters of the Colony, to the constant vexation of all who have its prestige and independence at heart. The importance of this reservation becomes evident in face of the stipulation that "the existing landing place near Kowloong city shall be reserved for the convenience of Chinese men-of-war, merchant, and passenger vessels, which may come and go and lie there at pleasure."
The trade of Jersey with France is not comparable in volume to the trade of Hong Kong with Kwangtung. The situations are, however, analogous, and the mere suppo- sition of the French authorities making, in regard to Jersey, such demands as the Chinese authorities are understood to have made in regard to Hong Kong appears sufficient to demonstrate their inadmissibility.
The Right Honourable
The Marquess of Salisbury, K.G.,
DEAR SIR,
I have, &c.,
R. S. GUNDRY,
Hon. Sec. China Association.
Her Majesty's Secretary of State for Foreign Affairs.
(1.)
HONG KONG Branch of CHINA ASSOCIATION to GENERAL COMMITTEE.
Hong Kong, July 30, 1898. IMPORTANT information has reached this Branch in regard to the demands made upon the Hong Kong Government by the Imperial Maritime Customs in connection with the recent accession of territory to this Colony. The matter has been before the Com- mittee of this Branch, and, at their request, I address you on the subject. I am sending you at the same time a short wire as follows:-
"Customs demand plenary powers Hong Kong new territory. Strongly oppose. Letters follow."
You are fully acquainted with the position occupied by the Imperial Maritime Customs in Hong Kong at the present moment, under the arrangements made in Sep- tember, 1886, by the late Sir James Russell, under the provisions of the Chefoo Conven- tion. For present purposes it is sufficient to say that their presence in the Colony simply tolerated. They have no official position. They are not recognised, and, in theory, the whole work of the Customs is done on the opposite mainland of China.
Under the Convention of the 9th June last, the whole of the mainland opposite Hong Kong and for a considerable distance cast and west becomes practically British territory (the City of Kowloong, about which we wired you, excepted) under a lease for years. This Convention has not yet been published in Hong Kong, so that we do not know what special provisions there may be in it for the control and management of the new territory. We are assured, however, that there is nothing in it about the customs; but that, at the same time the Convention was signed, letters were exchanged between our Minister and the Tsungli-Yamen, to the effect that the British Government would do all it could to safeguard the Chinese revenue in the new territory; and in con- nection with that promise Sir Robert Hart has put forward the following demands :-
(1) That the Commissioner of Customs, now known as the (Chinese) Kowloong
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