The consequent fall from 1/5 to 1/33 was fortunately unattended by any very marked disturbance in local banking circles, as Hong Kong commitments were mainly on foreign account.
30. The relative stability of silver prices in New York and London during the period of falling exchange led to considerable smuggling of silver out of China in evasion of the heavy duties imposed for the purpose of conserving the metallic backing of the nation's currency. Silver stocks in this Colony were mainly earmarked against Bank note issues, but such free silver as was available in the market or surplus to the note reserves exported and much of the silver smuggled from China passed through this port for shipment abroad. The export of silver from Hong Kong was prohibited as from 9th November.
31. The value of silver exports during the period of rising exchange and during the later period when exchange was falling is shown as under:
EXPORTS OF BULLION AND SPECIE FROM HONG KONG (EXCLUDING GOLD).
January to June 1935 $24,156,038 July to December 1935 $150,661,90832. The adoption of a managed currency in this Colony is a concession to the accepted principle that Hong Kong is bound to China in its currency policy, in so far as any wide divergence of the Hong Kong Dollar from the Chinese Dollar means dislocation of trading facilities. There can be no doubt as to the prudence of the measures adopted by China to check the depletion of the national reserves.
33. So far as Hong Kong is concerned, a basic change of this significance involves too many uncertainties to warrant any prediction as to the future. Stability of exchange is said to be the first step towards rehabilitation of trade, and a managed currency should promote confidence in the machinery of our commerce. It is not, however, to be expected that it will restore to merchants markets lost by tariff barriers, cheap foreign labour and subsidized competition. Its fullest effect will be felt in proportion as the manufacturing and producing resources of the Colony are developed. The slight expansion evident on these lines during recent years can give rise to no confident optimism as to the immediate future, though such enterprises that may be exploited will escape the risk of violent fluctuations in exchange that have proved frequently disastrous to promising ventures in the past.
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T
The consequent fall from 1/5 to 1/33 was fortunately unattended by any very marked disturbance in local banking circles, as Hong Kong commitments were mainly on foreign account.
30. The relative stability of silver prices in New York and London during the period of falling exchange led to considerable smuggling of silver out of China in evasion of the heavy duties imposed for the purpose of conserving the metallic backing of the nation's currency. Silver stocks in this Colony were mainly earmarked against Bank note issues, but such free silver as was available in the market or surplus to the note reserves exported and much of the silver smuggled from China passed through this port for shipment abroad. The export of silver from Hong Kong was prohibited as from 9th November.
was
31. The value of silver exports during the period of rising exchange and during the later period when exchange was falling is shown as under:-
EXPORTS OF BULLION AND SPECIE FROM HONG KONG
(EXCLUDING GOLD).
January to June 1935
$24,156,038
July to December 1935
$150,661,908
32. The adoption of a managed currency in this Colony is a concession to the accepted principle that Hong Kong is bound to China in its currency policy, in so far as any wide divergence of the Hong Kong Dollar from the Chinese Dollar means dislocation of trading facilities. There can be no doubt as to the prudence of the measures adopted by China to check the depletion of the national reserves.
a
33. So far as Hong Kong is concerned, a basic change of this significance involves too many uncertainties to warrant any prediction as to the future. Stability of exchange is said to be the first step towards rehabilitation of trade, and a managed currency should promote confidence in the machinery of our commerce. It is not, however, to be expected that it will restore to merchants markets lost by tariff barriers, cheap foreign labour and subsidized competition. Its fullest effect will be felt in proportion as the manufacturing and producing resources. of the Colony are developed. The slight expansion evident on these lines during recent years can give rise to
rise to no confident optimism as to the immediate future, though such enterprises that may be exploited will escape the risk of violent fluctuations in exchange that have proved frequently disastrous to promising ventures in the past.
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