CO129-578-5 Development of Whampoa Port 13-12-1938 - 11-5-1939 — Page 3

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The Consul General gives as his opinion that

the Japanese are now likely to undertake further

development of this scheme. He thinks that there

can be no longer any question of the development of

Whampoa to the ambitious extent envisaged by the

Chinese. If the Japanese take up the scheme themselves,

as seems probable from the enclosed extract from a

Japanese news paper, they would almost certainly

confine the future port of Whampoa to more modest

proportions. The advantage, of course, from the

Japanese point of view is that Whampoa would stand a

chance of taking from Hong Kong a fair percentage of

her entrepôt trade with south China, which in normal

times forms a considerable and growing part of Hong

Kong trade. It therefore looks as if the threat of

Whampoa becoming a rival port to Hong Kong at least

looks as if it might materialise to a certain extent.

But in spite of the Japanese newspaper

article there may still be much force in the arguments

contained in Mr. Scott's memorandum. Small coasters

of about 2,000 tons already proceed up as far as

Canton, and that being so, are not really likely to

use Whampoa any more than Hong Kong. Nevertheless,

although the Japanese would be constructi

ructing the port

in the first place, presumably for the use of their

own ships, their object is, at the same time, to

divert as much as possible of Hong Kong's trade;

Mr. Scott admitted in his memorandum that the

success or failure of the project would not depend

wholly on technical and commercial factors, but also

on political. But we are still powerless to do anything

about it.

? Economic Department to see, then put by.

A. N. Galsworthy

29.1.39.