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 5

CO129 Colonial Office Hong Kong Records 理藩院香港檔案 All

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It is nulikely that recent works har eradiculed out of thes Cantonese anthontics all personal interest in the

smuggling activites at HK.. So that opposition on some scale must still be expected in practic. ING.

7A

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negotiated in 1930 and dropped at the very last

minute by the Chinese, owing, it is alleged, to

x

financially interested opposition from Canton.

(The annexure to the memorandum tells that story

more fully, if the Secretary of State has time

to read it). We have just learnt that

Sir F. Maze (the Inspector General of the Chinese

Maritime Customs) has unofficially asked if

negotiations on the basis of the 1930 draft might

be resumed and has received a favourable answer

from the Governor. A despatch on the subject

is now on its way from Hong Kong and consideration

of any action should await its arrival.

The Secretary of State also asked about

currency policy in Hong Kong and I attach a

separate note on the recent history of that.

As shown there, that policy was determined in the

closest consultation with the Governor (who kept

in close touch with banking and trade interests

in Hong Kong) and with our "experts" here,

particularly the Treasury and the Bank of England,

the views on the crucial issues expressed on

behalf of the Bank being, we were given to

understand, those of the Governor himself. It is

fairly certain, in the light of after events that

Hong Kong would have benefited by depreciating

its currency parallel with Shanghai throughout,

but it was by no means obvious that that would be

wise when the question originally arose. It is

perhaps not necessary to consider whether any blame

should be apportioned but it may truthfully be

said that those responsible in the Colonial

Office were at all times more disposed to take

action than the advisers whose advice they

actually agreed to take,

sell lose?

on return

EWGent. 5.

12-10

12-10-36

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