CO885-11 — Page 676

PUBLIC RECORD OFFICE

Reference :-

C.O.882/11

PUBLIC RECORD OFFICE, LONDON

|ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-

COPYRIGHT PHOTOGRAPH—NOT TO

176

the adoption of the course, unanimously recommended by the Members of my Execu- tive Council, of calling for tenders in the open market.

14. The action taken by His Majesty's Government in May last must, of course, have been based upon information of an impeccable and irrefutable character, such as would justify this Government in refusing to consider any tender submitted by him or by any persons associated with him. Up to date, however, my Government has not been placed in possession of this evidence against Nemazi, in this connexion, I submit for your consideration, a minute by the Attorney-General, dealing with the facts against this individual which are on record on our files, and I would suggest that a statement of the full case against him would greatly assist me to justify such discriminatory action.

15. I and my advisers, however, are not convinced that the best interests of this Government will be served by discarding the usual practice of calling for tenders in the open market, merely or principally in order to avoid the risk of Nemazi obtaining a share in the contract; while it is very acutely conscious of the extreme difficulty and embarrassment that it will experience in publicly justifying the proposed bargain with Messrs. Bellairs, Atkinson and Co., late M. P. Nicolaidi and Co.

16.

In this matter, the safeguards suggested in your telegram of 10th November will not greatly help us. They will make our position ris-à-cis Messrs. Bellairs, Atkinson and Co., less insecure than it would have been under the agreement as originally drafted; but they will not greatly aid us to justify the employment of that firm, more or less upon terms of its own selection, to the exclusion of all other possible competitors.

I have, &c.,

L

IIUGH CLIFFORD,

Malayan Civil Service,

Governor.

Enclosure in No. 132.

MEMORANDUM.

THE only direct evidence" against M. A. Nemazi in this file is that set out in the letter of the Acting Consul-General, Saigon, dated the 16th March, 1923. It is stated in that letter that in August, 1922, M. A. Nemazi was implicated with two Frenchmen in an alleged attempt to bribe the Director-General of Indo-Chinese Customs to facilitate the passage of opium into China. The three men were arrested and tried. The Court found that, as against Nemazi and one of the others, there was no case. It is not suggested that any facts have been discovered other than those before the Court, which tend to establish Nemazi's complicity. So far, then, as the information furnished to this Government goes, the Saigon episode is not evidence that Nemazi was engaged in the illicit opium traffic.

2. This file contains numerous allegations against Haji Muhammed Hassan Nemazi of Hong Kong. His complicity in the opium traffic is stated to be notorious, although no definite evidence on which a charge could be brought under the Iong Kong Ordinance has heen forthcoming. M. A. Nemazi is connected with this man in two ways he is his nephew and he is the agent in Singapore for his ships. I can find nothing in the file which indicates that these two men have been associated in any operations relating to opium. It is true that the Deputy Secretary to the Government of India in his letter of the 16th June, 1927, states that the Government of India suspect that M. A. Nemazi is connected with the Hong Kong firm, but no grounds for the suspicion are given.

On the information furnished to this Government there appear to be no adequate grounds for such suspicion.

M. H. WHITLEY,

Attorney-General, Straits Settlements.

C. 53017/28 [No. 16].

177-

No. 133.

670

SIR M. DELEVINGNE (HOME OFFICE) to SIR G. GRINDLE (Colonial Office).

MY DEAR GRINDLE,

Home Office, Whitehall, S.W.1,

27th February, 1928.

I HAVE given a good deal of consideration to Sir Hugh Clifford's despatch of the 22nd December* and to your note to me of the 14th February. The Governor's despatch astonished me both as regards its substance and its tone and 1 should imagine astonished you too.

When he says in paragraph 3 that the requirements of his Government, including a requirement that the price charged is not exorbitant, have all been satisfied by the local dealers from whom Persian opium has been bought in the past, and that these dealers, so far as his Government's information goes, are to a large extent in com- petition with each other, he is saying what is inconsistent with the previous despatches from his Government and with the information given to us by his own officials. In the copy of Mr. Wilson's note which Paskin sent me on the 27th August last‡ Mr. Wilson Baid that it would pay the Straits Settlements Government handsomely to give their business through Bellairs Atkinson as Government agents to Haji Ali Akbar and Sous as merchants, allowing the latter say od. per pound over the lowest current price; and he explained at the Interdepartmental Conference that he meant by this that it would pay them handsomely in comparison with the price they had been paying Nemazi. The same view that Nemazi had been making the Straits Settlements Govern- ment pay excessively was expressed, as you will remember, by our Consul-General at Bushire, for example, in his despatch of the 24th March, 1927§ (the despatch to which you allude in your note). Then again, as regards the firms to a large extent being in competition with each other, you will remember Sir Hugh Clifford in his despatch of 1st October said there was reason to believe that the local dealers, if not actually constituting a ring, had a working arrangement by which too keen competition is obviated. This also, as you point out, is supported by the Bushire despatch of 24th March, 1927,§ and by what Mr. Wilson told us.

It seems to me obvious that Sir Hugh Clifford has developed a very strong prejudice on the whole subject. It appears in almost every sentence of his despatch. If the agency system is so wholly indefensible as he thinks, it is strange that he did not find this out before. In his despatch of the 1st October last it was the question of security "that preoccupied him. Apart from this, he had no objection to the arrangement and he put forward one or two suggestions as to means by which the Government could secure that it was not charged an exorbitant price if the agency system were adopted. Nothing is said as to those suggestions in the present despatch. Then again, what is the ground for the prejudice, which you yourself notice, against Bellairs. Atkinson and Co.? No indication of this appeared before; in his despatch of the 21st March. 1927, enclosed with Paskin's note of the 25th April, Guillemard evidently thought that Bellairs, Atkinson and Co., would be quite à suitable firm to employ. What has occurred to influence the Governor I do not, of course, know, but the effects are manifest enough in the despatch.

Again, why in paragraph 2 of the despatch, does the Governor speak of the course proposed by the Home Government as exceptional "? Will not the Straits Govern- ment be making a new departure, whatever course is taken? Were there any pur chases by them of Persian opium on the large scale before the new Indian opium policy? Is not the system of tenders for opium which the Governor and his Executive Council favour as

as anything else?

""

exceptional

"

It appears to me quite impossible that the Home Government should accept the Governor's contention that the method of purchasing Persian opium and the dealers or agents employed for the purpose are primarily domestic matters. The price to he paid. no doubt, is so; but as regards the methods and the agents employed the Imperial Government has a strong and direct interest in view of the discreditable character of a great deal of the traffic in opium, and especially Persian opium, in the Far East, and of the special action which has been taken by the League in regard to

24th November, 1927.

* No. 132.

§ No. 122.

.

† C. 53017/28 [No. 5]: not printed.

No. 130.

↑ C. 30801/A/27 [No. 76]: not printed. C. 30801/A/27 [No. 30]: not printed.