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 35

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The possible desirability of a Customs Union or other

special arrangement on matters of trade between Hong Kong

and China.

The very close trade relations between Hong

Kong and China have led several times in the past to

consideration being given to the making of a special

S'n Iflykting agreement regulating trade between them. Si J. Maffey 11: इनडाप

It has now

been suggested by Sir Frederick Leith-Ross that con-

sideration should be given to the possibility of the

entry of Hong Kong into a Customs Union with China.

the

of such a union, Clearly ts value, apart from any general requirements

's

of British policy towards China, depends on its antici-

estad

X

pated effect on Hong Kong trade.

win

General Nature of Hong Kong Trade.

2. Four broad categories may be distinguished:-

(a) imports for consumption in Hong Kong (including

raw materials for certain industries) and exports of

Hong Kong origin;

(6) Chinese external trade passing through Hong

Kong, i.e., Chinese goods re-exported to non-Chinese

countries and non-Chinese goods re-exported to China;

(c) Chinese coastal trade, i.e., goods imported from

one part of China and re-exported to another;

(a) Non-Chinese entrepôt trade, i.e., goods imported from a non-Chinese country and re-exported to another non-

Chinese country.

B

The Hong Kong trade returns do not distinguish

between imports for consumption and imports for re-export or between exports of Hong Kong, Chinese land non-Chinese

origin,

2