CO129-589-11 Port of Hong Kong- Report on future control and development 18-7-1941 - 10-10-1944 — Page 4

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The Govenor has now sent us his observations on Sir David Owen's report which in our telegram at 2 we told him that we would wait.

The report has received consideration from all the Government Departments concerned, as well as from the Commodore-in-Charge and the General Chamber of Commerce. The Governor does not give us the views of these different bodies, but he does enclose what he describes as "some interesting comments" provided

by a group of citizens headed by the Bishop.

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These comments are not in any way supported by the Executive Council, but they are no doubt sent to us as showing another side of the case which is worthy of consideration. It will be seen that the Bishop and his fellow signatories are opposed to Sir David Owen's proposals that the new Harbour Trust should "control" and not "operate" the harbour facilities in the Colony. On this I would draw particular attention to para. 77 and para. 83(j) of Sir David's report. From the first of these references it will be seen that there is a widespread fear among mercantile interests in the Colony that a form of port authority which would "operate" the harbour facilities would inevitably increase charges on vessels and goods, and that in the second of the references he stated that he would strongly recommend leaving "operations" in the hands of private enterprise, having regard to conditions in Hong Kong. The plea for complete public control of port administration in the Colony is certainly put very attractively in the statement by the Bishop and his fellow signatories, but their statement that such a change would be more in line with modern developments is not, in the light of the report, absolutely true. A system such as Sir Davi Oven has suggested is found for instance, at Liverpool. The crux of the matter, however, lies in the question of expense. The Bishop and his fellow signatories point out that the present low rates in the port are not due to the efficiency of private ownership so much as to the low cost of labour in Hong Kong, and they would, no doubt, be glad to see the labourer receiving higher wages. from a public authority. That, however, raises the aifficulty that Hong Kong owes its pre-eminenc

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port not us to any natural advantages of site and that an undue increase in the costs of operation of the port might well lead to rivals springing up and taking way the entrepôt trade which is the Colony's life blood. Sir David Owen evidently felt that a Port Trust operating harbour facilities would in fact lead to some increase in cost, and in the face of his opinion, as backed by the Executive Council, I do not think that we would be justified in

accepting