CO129-396 - Public Offices - 1912 — Page 37

35

[This Document is the Property of His Britannic Majesty's Government.]

2

Up to the present only about 1,000 dollars' worth of opium has been bought in bri the bureau, the farmers easily finding secret buyers willing to pay from 65 to 75 cents per Chinese ounce, according to quality. I am told that large quantities have been buried by the farmers, who feared that the Government would confiscate the opium when the efforts of the latter to buy it at 30 cents an ounce had failed; moreover, that a considerable amount is being smuggled from Yünnau into Tonquin, Burmah, and Szechuan.

In Yunnan-fu at the present moment the price of new opium is from 70 to 80 cents per ounce, and fold opium of former harvests has dropped from 1 dol. 30 c in April to 1 dol. 15 c, per Chinese ounce. (Copy to Burmah and Tengyuch)

I have, &c.

P. E. O'BRIEN-BUTLER,

Enclosure 2 in No. 1.

Memorandum communicated to the Wai-chiao Pu by Sir J. Jordan.

HIS Majesty's Minister begs to inform the Wai-chiao Pu that he is in receipt of a despatch from His Majesty's consul-general at: Yünnan-fu, stating that the opium crop in the province of Yunnan has all been harvested, and that the yield averages about 80 per cent. of that obtained before the cultivation of the poppy was prohibited, and, owing to suitable climatic conditions, is of very good quality. that in May of the present year an official opium bureau, with a working capital of He further reports 1,000,000 dollars, half of which was furnished by the Provincial Government in newly-issued notes, and the balance in silver 1,000 dollar shares by former opium firms, was established, and farmers were called upon to hand over all their opium to the bureau, which would pay them 30 cents a Chinese ounce, the intention of the bureau being to export the drug to Tonquin, and there dispose of it to the Opium Régie at from 1 dol. 60 e. to 1 dol. 80 c. per ounce.

His Majesty's Minister begs to cite the above as an illustration of the way in which China is carrying out her share of the Opium Agreement of last year. There is no national policy, for, while Chekiang and other provinces are breaking the agreement by prohibiting the sale and transit of Indian opium within their borders, the province of Yunnan has resumed cultivation of the poppy on a scale little short of pre-restriction days, and has become an exporter of opium. Should such a policy, or lack of policy, continue, the result will be that Great Britain, acting from humanitarian motives, will have stopped the Indian export to China merely to advance the native cultivation, and the last state of China will be no better than the first,

Sir John Jordan considers it useless to discuss what the policy of the Chinese Government on this subject may be, but the uncontrolled action of the provinces is fast leading to the inevitable practical result, namely, the exclusion of Indian opium and the protection of native cultivation for home consumption as well as for export.

J. N. JORDAN.

Peking, July 18, 1912,

OPIUM.

CONFIDENTIAL

[33382]

No. 1.

[August 8.]

SECTION 1.

India Office to Foreign Office.-(Received August 8.)

Sir,

India Office, August 7, 1912. WITH reference to your letter of the 25th July, 1912, on the subject of the losses alleged by Messrs. Sassoons to have been sustained by them and by other firme engaged in the China opium trade, I am directed by the Secretary of State for India in Council to say that he is doubtful whether any reply is required to Messrs. Sassoons' contentions that the merchants are not responsible for the magnitude of the losses complained of. If a reply is considered necessary I am to suggest that it might be somewhat to the following effect:-

In

"His Majesty's Government do not think that any useful result would follow from pursuing the discussion as to what brought about the exceedingly high prices for certificated opium which ruled last year in the treaty ports, and consequentialy in India, or whether these prices were justified. But exception must be taken to the statement that the prices in question were solely due to the action of the Government of India in establishing two descriptions of opium, namely, a small quantity certificated for China, and a large quantity uncertificated and not available for importation into Chiun. 1911 the number of certificated chests of Indian opium was 30,600, and of uncertificated chests 14,000. In addition to the 30,600 chests exported from India, uncertificated opium to the amount of 11,459 chests, which was in bond in treaty ports or in stock in Hong Kong, was by annex to the agreement of May 1911, allowed to outer China. In the aggregate, therefore, the quantity of Indian opium permitted to enter China in 1911 was actually three times as great as the exports to non-China markets, and from no point of view could be regarded as small.”

With regard to the enquiry made in the last paragraph of your letter whether steps should not be taken to meet the views of the opium merchants as to a reduction in the amount of uncertificated opium exported from India, I am to say that these views are not universally held. In 1911, when the export of uncertificated opium was fixed at 14,000 chests by the Indian Government, complaints were made by the Government of the Straits Settlements that this amount was insufficient for the requirements of non-Chinese markets, and that by thus limiting it the Indian Government was unwittingly helping the Hong Kong firms to create an artificial scarcity of the article and to force up the price both of certificated and uncertificated opium. In the current year the export of uncertificated opium has been further reduced to 13,200 chests. The figure for 1913 has not yet been announced by the Government of India, and their attention will be called to the suggestion made in your letter. The Marquess of Crowe trusts that the representations which have been made to the l'ortuguese Government will result in that Government fixing a limit to the amount of opium that may be imported into Macao. If in Sir Edward Grey's opinion an early settlement would be promoted by prohibiting or restricting further cousiguments to Macao as a temporary measure, the Government of India will again be invited to examine the question.

I am,

&c.

LIONEL ABRAHAMS.

[2604 -1