CO129-396 - Public Offices - 1912 — Page 7

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The value of this stock at 400l. per chest of Bengal opium and 3501. per chest of Malwa opium is:

---

Bengal opium.. Malwa opium..

Total ..

6,000,000 5,950,000

11,950,000

or, say, 12,000,0001, and I am assured that this is a conservative estimate.

3. The financial position is therefore extremely serious; for, if the price of certified opium continues to fall, this stock can only be worked off at an enormous loss. For this reason the Hong Kong and Shanghai Banking Corporation, the Chartered Bank of India, Australia, and China, and the Hong Kong General Chamber of Commerce have taken the matter up, and have requested me to make representations to you on the subject.

4. I am informed that the upset price of opium at the auctions held by the Government of India is very low. If, therefore, the opium merchants refrain from bidding at the July or any subsequent auctions, they fear that some outside firm may, as a speculation, purchase at a very low price such opium as is put up for auction, and then undersell the stock previously purchased at very high prices for the China market. On the other hand, the more the opium merchants buy at the mouthly auctions in India the more capital is tied up in stocks which lie idle and can only be disposed of gradually, and the greater is the risk of ultimate loss owing to the uncertainties of the opium trade and the instability of the political situation in China.

5. The opium merchants argue, as it seems to me with great cogency, that they purchase their opium from the British Government on the faith of treaties now existing between Great Britain and China, but that, owing to the chaotic state of China, these treaties are for the time being inoperative. They contend, therefore, that it is the duty of the British Government either to compel the Chinese Government to observe the opium treaties, or, if that is impossible, to suspend the auctions of certified opium in India until such time as the treaties can be made effective.

6. The situation in Macao is most unsatisfactory, and I enclose copies of correspondence which has recently passed. There can be little doubt that the smuggling of opium into China is being conducted on a very large scale, and so long as the Government of Macao allow their opium farmer to import a number of chests so much in excess of the legitimate requirements of the colony there is little hope of it ceasing.

7. I am forwarding a copy of this despatch to Sir John Jordan.

Enclosure 2 in No. 1.

I have, &c.

CLAUD SEVERN.

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Enclosure 3 in No. 1.

Messrs. David and Messrs. E. D. Sassoon and Co, to Hong Kong General Chamber of Commerce. Dear Sir,

Hong Kong, June 7, 1912. WE regret to be compelled again to bring before you the extremely unsatisfactory condition of the opium trade, and would request you to be good enough to forward a telegram to His Britannic Majesty's Minister at Peking, drawing his attention to the

serious state of affairs.

We would suggest wiring as follows :-

Heavy decline of 1,700 rupees per chest between May and June; Indian Govern- ment opium sales clearly demonstrates the serious effect on the trade due to disregard Position of British merchants owing of opium agreement by Chinese Government.

to heavy depreciation has become more serious. Indian Government continue monthly sales notwithstanding inability enforce observance of treaty. Under circumstances only solution Indian Government should discontinue selling Bengal and Malwa pending adherence treaty. Hong Kong and Chartered Banks confirm seriousness of situation and need for relief without delay,"

In connection with the concluding paragraph of the telegram, we beg to say that we have obtained the authority of the Hong Kong and Shanghai Banking Corporation and the Chartered Bank of India, Australia, and China.

We would further request you to ask the Colonial Secretary to dispatch a telegam in the same sense to the Foreign Office.

Thanking you in anticipation, we are, &c.

Sir,

DAVID SASSOON AND Co. (Limited). E. D. SASSOON AND Co.

Enclosure 1 in No. 1.

Colonial Secretary, Hong Kong, to Secretary-General, Macao.

Hong Kong, May 2, 1912. I AM directed to inform you that on 1st September, 1911, this Government prohibited the importation into Hong Kong of any kind of raw Indian opium unless covered by export permits from the Government of India to the effect that it har been declared for shipment to or consumption in China, provided, however, that the Hong Kong opium farmer is allowed to import for consumption in the colony 900 chests per annum which are not covered by such permits.

2. I am to enquire whether your Government are taking any steps to limit the amount of uncertificated opium which can be imported into Macao."

I ain, &c.

C. CLEMENTI.

Sir,

Hong Kong General Chamber of Commerce to Colonial Secretary, Hong Kong.

Hong Kong, June 7, 1912.

I BEG to inform you that Messrs. David Sassoon and Co. (Limited) and Messrs. E. D. Sassoon and Co. have addressed this chamber under this date on the subject of the extremely unsatisfactory condition of the opium trade, and I enclose a copy of their letter for the information of his Excellency the Officer administering the Government,

The committee gave this matter their consideration, and immediately dispatched a telegram to His Majesty's Minister at Peking in the sense desired by Messrs. Sassoon's. With reference to the last paragraph of Messrs. Sassoon's letter, my committee would be glad if his Excellency could see his way to accede to the request made, inasmuch as that a continuance of the present unsatisfactory state of affairs is calculated to seriously affect the interests of the colony.

I am &c.

E. A. M. WILLIAMS, Secretary.

(Translation.) Sir,

Enclosure 5 in No. 1.

Secretary-General, Macao, to Colonial Secretary, Hong Kong.

Macao, Mag 4, 1912. HIS Excellency the Governor directs me to thank you for the information contained in your letter, and to inform you that the necessity for adopting special measures in Macao relative to the importation of uncertificated raw opium has not yet made itself felt. Uncertificate raw opium is actually imported by the Macao opium farmer only for the use of his farm, and such importation is made within the limits prescribed in the

contract.

The other opium dealers in Macao confine themselves to the trade in raw opiutu with China, and therefore only import raw Indian opium destined for exportation to China by the Government of India.

Health and fraternity.

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MANUEL FERRA, DA ROCHA.

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