CO129-516-5 Policy of Hong Kong government on the purchase and supply of opium 25-2-1929 - 10-5-1929 — Page 2

1. Gov. Secret.

See No. 2 on

52836/28

E2 30236/29

25.2·292

by

Seeks authy to purchase, instalments, 146 cheats of Persian aprim & to revise scale of prices for sale of apuin.

fa Requests tel reply.

Hong Kong have again raised the question

of reducing the price of Opium. It will be

remembered that in 1927 the Governor, without

consulting us, considerably reduced the price of

Government Opium in order to compete with the

smugglers. The result was a large increase in the

sales of Government Opium and a temporary cessation

of smuggling. The sale of Opium at a low price

could not, however, be continued without the

purchase of Persian Opium. Permission for this

was, after much discussion between the Colonial

Office, Home Office and Foreign Office, and

after reference to the Cabinet, refused.

The Governor now submits proposals with

the same object but in a much modified and less

object ionable form. He takes the line that his

supplies of Indian Opium are decreasing in

See 6 milF14158/26 accordance with the export restriction policy of

the Indian Government and that he ought, therefore,

to be allowed to supplement them with Persian

Opium. He suggests, therefore, that he be allowed

in effect to make up his total supplies of Opium

to the amount of Indian Opium imported in 1927 (the standard year) by the purchase of Persian

Opium. With these supplies he would be able to

effect an adjustment of the price of Government Opium which he thinks would lead to some diminution top-quality opium of the smuggling. will actually one

is

adjustment,

not simply reduction; f

more.

"

are:-

The arguments against this proposal

(1)