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PUBLIC RECORD OFFICE

Reference :-

C.O. 882

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO

5 PUBLIC RECORD OFFICE, LONDON

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and which should not be later than the date at which the administration of the leased territory is taken over by the Hong Kong Government.

6. With reference to the second question, Her Majesty's Government have under- taken to adopt all possible precautions to prevent the leased area from being used to facilitate smuggling into China, or in any other way to the detriment of Chinese in-

terests.

7. You have already intimated to the Chinese Government in the note which you addressed to the Tsungli-Yamên on the 20th September, that the "Regulations" drawn up by the Viceroy of Canton with this object cannot be adopted, and the proposals of Sir Robert Hart, enclosed in your despatch, No. 139, of the 4th July, are equally inad- missible.

8. The importation of arms and munitions of war from Hongkong to China can be dealt with by proclamation under a Colonial Ordinance, and the only practical difficulty appears to be that of protecting the opium revenue. After careful consideration of the question, Her Majesty's Government have come to the conclusion that the easiest and most practical solution of the difficulty, and that which affords the best means of fulfilling their pledge to the Chinese Government, would be the establishment of a system whereby the Chinese Customs duties on opium imported into China from Hong Kang, including the new extension, should be actually collected by the Government of Hong Kong, the whole proceeds, after deductions of the expenses of collection, being paid over to the Chinese Government. This would involve regulations under which all opium imported into the Colony must be imported in bond, and none exported except out of bond. It should at the same time be stipulated that the Chinese Customs sta- tions and officers must be removed from the Colony and leased territory, or its imme- diate vicinity, in order to prevent a repetition of the difficulties and annoyances which have been so constant in past years. It is obvious that this proposal is a very advan- tageous one for the Chinese Government. It would not only enable them to obtain pay- ment of their Customs duties on opium in a much easier and more effective manner than hitherto, but it would also save them the great expense and trouble of maintaining their fleet of revenue cruisers and launches in the waters of Hong Kong and its vicinity.

9. Finally, with regard to the question of the boundary, Mr. Lockhart's report shows that the line on the map attached to the Convention cuts in two the valley of which Sham Chun the centre, and, while leaving that town to China, divides the villages in the valley, hitherto linked together by family ties and common interests. Sham Chun is also the seat of the local Government Council which controls the portion of the San On district included within the leased area. It is, moreover, to be feared that if this town be allowed to remain just outside the leased territory, it will, as was the case with Kowloon, prove a constant source of trouble and friction between the Governments of Hongkong and China, and facilitate smuggling into China to the injury of the Chinese revenue.

10. Sham Chun appears to be situated less than two miles to the north of the Convention boundary, and as the Convention provided that "the exact boundaries shall be hereafter fixed when proper surveys have been made," &c., it seems not unreasonable in view of the facts stated above, and also of the great assistance to be offered to China in the matter of the collection of Customs duties and the prevention of smuggling, to ask that it be included within the leased territory.

11. You should endeavour to come to an arrangement with the Chinese Govern. ment on the lines indicated in this despatch.

12. As regards the date to be fixed for taking over the new territory, it will be necessary that you should place yourself in communication with the Governor of Hong- kong, and it will be desirable to keep him informed of the progress of your negotiations.

27906.

(Confidential.)

No. 53.

COLONIAL OFFICE to FOREIGN OFFICE.

[See No. 72.]

SIR,

Downing Street, December 13, 1898. I AM directed by Mr. Secretary Chamberlain to acknowledge the receipt of your confidential letter of the 10th instant,* having reference to the newly-acquired terri-

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tory in the vicinity of Hongkong, and enclosing the draft of a despatch which the Marquess of Salisbury proposes to address to Her Majesty's Minister at Pekin on the subject.

2. I am to request that you will inform His Lordship that Mr. Chamberlain en- tirely concurs in the terms of this despatch.

28240.

SIB,

No. 54.

I am, &c.,

C. P. LUCAS.

ADMIRALTY to COLONIAL OFFICE.

(Received December 16, 1898.)

Admiralty, December 15, 1898. WITH reference to your letter of the 30th ultimo, No. 23608,* enclosing a copy of the report by Mr. Stewart Lockhart on the extension of the Colony of Hong Kong, I am commanded by My Lords Commissioners of the Admiralty to request you will in- form the Secretary of State that a survey of Deep Bay will be made as soon as circum- stances admit of this being done.

I am, &c.,

27906.

No. 55.

EVAN MACGREGOR.

MR. CHAMBERLAIN to GOVERNOR SIR H. A. BLAKE.

1

(Confidential.)

SIR,

Downing Street, December 23, 1898.

I HAD hoped to be able to address you fully by this week's mail on the subject of the newly-acquired territory in the vicinity of Hongkong, and to convey to you the in- structions of Her Majesty's Government as to its formal occupation.

2. I find, however, that circumstances will not admit my doing so before the mail of the 6th January; but I am anxious that you should be made acquainted with the action that has been taken in the matter by Her Majesty's Government up to the present moment, and I enclose, therefore, for your information, a copy of the recent correspond- encet with the Foreign Office, together with a copy of Mr. Lockhart's report of his recent visit to the territory. I take this opportunity of placing on record the sense en- tertained by Her Majesty's Government of the obligations they are under to Mr. Lock- hart for his interesting and valuable report.

3. The enclosed correspondence sufficiently explains itself, and no formal action You will will be necessary on your part until you receive a further despatch from me. observe, however, that Her Majesty's Minister at Pekin has been instructed to place himself in communication with you on the subject, and that the early part of February has been mentioned as an approximate date for the formal occupation of the territory. It seems hardly probable now that this date can be adhered to, and in any communica- tions with Sir C. MacDonald it may be well that you should make it clear to him that

■ postponement of a few weeks may probably be found necessary.

4. I may add that Mr. Lockhart proposes to leave this country for Hongkong by the mail steamer of the 29th inst.

I have, &c.,

J. CHAMBERLAIN.

• No. 52.

• No. 49.

+ Nos. 47 and 52.

1 No ä

BAA

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