CO129-558-11 Mission of Sir F. Leith-Ross to China- proposals for a Hong Kong - China customs... 29-9-1936 - 30-12-1936 — Page 25

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Mr. Eden agrees therefore win the view expressed in the

concluding paragraph of the Secretary of State's memorandum

that the immediate object of any negotiations that may now

be begun should be an agreement on the lines of the 1930

draft rather than a full Customs Union. It seems desirable,

however, not to lose any opportunity that may present

itself of enlarging the scope of the negotiations to secure

if possible some at any rate of the advantages of a Customs

Union.

4.

In this connexion attention may be drawn to the

arrangements that were in force at the port of Tsingtao

during the period that the Kiaochow territory was under lease

to Germany. Under the Sino-German agreement of 1899-1906

Tsingtao enjoyed all the advantages of a Treaty port combined

with free port status and the manufactures of the Leased

Territory were to some extent brought within China's tariff

There are of course great differences between the

circumstances of Kiaochow at that time and the present

circumstances of Hong Kong and Kowloon.

arrangements at Tsingtao under the agreements in question

might with advantage be studied, in conjunction with the

authorities at Hong Kong, with a view to ascertaining

whether it would be practicable and useful to secure the

adoption of some similar arrangement at Hong Kong.

wall.

I am,

Sir,

Nevertheless the

Your obedient Servant,

Aw. Orde