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 61

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1935, the Chinese Government announced a new scheme

involving the definite devaluation of the Chinese

currency, and it was then felt that the time had come

when action must be taken in Hong Kong. As a preliminary

step the export of silver was prohibited, and this was

followed by a new Currency Ordinance taking over the whole

as warching for he

the

of the silver formerly held bot from note issues by the

three banks, as well as all the other silver

Colony, and setting up a managed currency. Since then

the policy which has been successfully pursued has been that of gradually allowing the Hong Kong currency to depreciate to approximately the same value as the Shanghai

dollar. There has been no difficulty in pursuing this

policy, and it is now generally agreed that it was the

right thing to do.