CO129-568-4 Estimates 1939 8-10-1938 - 6-7-1939 — Page 7

7

leopy for mr., howell Mr. Grat

ENTERED

FRONT OF REGISTER

IN

Mr. Rogers.

3 Extract from Hassard Report of 13/10/38

revised

4. You.

Gov Refl. by Leg. bo. on

5 you.

844

Tro. dfs: estimates 1939 as approved

1

21/11/38

10/1/58. Requests approval.

864

28/11/38

"Its. sealed copy of ordie. 22/38. Appropriation ordie. 1939

at

Last year the Hong Kong estimates

showed the effect of the interruption, by the

Sino-Japanese conflict, of normal and improving

conditions in China after the previous trade

depression. While the conflict gravely

embarrassed Hong Kong in a number of ways, the

purely financial effect was that Hong Kong's

trade gained by the diversion of trade from

Shanghai and by the war boom, while the

finances of the Colonial Government benefitted

from the increased number of persons in the

Colony and from the flourishing trade conditions.

The 1939 estimates have been prepared

during a further interruption of those conditions

by the Japanese capture of Canton, which has

resulted in Japanese control of Hong Kong's

hinterland and its land connections with China.

This interruption is likely to have more serious

effects than the previous one, both upon the

Colony's general interests and, in the long run,

on its finances. There is as yet no

immediate indication of a shortage of revenue

as a result of the Japanese occupation of

Kuangtung, but the Colony's position is

obviously