CO129-606-4 Hong Kong Loan- government grant 1-4-1947 - 2-3-1948 — Page 88

54126/6/47

Colonial office,

Downing Street, S.w.1.

24th April, 1947.

93

Dear Serpell,

In your letter of 13th March (52150/4) you asked for a picture of the future financial prospects

In this of Malayan Union, Singapore and Hong Kong. letter I will attempt to deal with the Hong Kong position on the basis of such information as is already in our possession.

2. A copy of the Governor's despatch No.48 of 24th July 1946 was enclosed in Hayle's letter to James of 22nd August and I now enclose a copy of a further despatch No.164 transmitting the 1946/47 Estimates. Unlike the Malayan Union and Singapore, Hong Kong had no reserves on which to draw, and in consequence all expenditure has had to be met from current revenue, public loans or loans from H.M.G. The latest estimate regarding 1946/47 was that given in the Governor's telegram No.450 indicating that revenue will amount to £4,875,000 and expenditure to £5,625,000 necessitating assistance from H. M.G. in 1946/47 of £750,000. In addition ($40,000,000) £2,500,000 special expenditure is chargeable to loan funds. As regards 1947/48 a copy of telegram No.533 is enclosed, which shows that the Government aims at balancing the budget so far as recurrent expenditure is concerned but special expenditure of 160,000,000 (£3,750,000) will have to be met from loan funds. Thus up to 31.3.48 Hong Kong's estimated liabilities will be as follows:

/(a)

D.R. SERPELL, 136., 0.B.E.