Directory_and_Chronicle_1941 — Page 396

A160

SHANGHAI

manufacturers. Owing to the increased population, sales of soap manufactured locally showed a decided improvement. Generally speaking, most of the local industries, taking advantage of the low exchange, were in a position to compete with their rivals abroad.

Comparing the year 1939 with 1936, a gradual return to normal conditions was noticeable in overseas shipping, but in the case of coastal shipping the figures were still a very long way behind, there being only 4,360 vessels entered and cleared as against 13,057 in the year 1936. By flags, Great Britain was able to maintain her leading position in both overseas and coastal shipping during the year. Japan held second place in both cases. As a result of the blockade of the China coast, Chinese-flag vessels, which held second place in 1936 and 1937 with several million tons, dwindled to an insignificant proportion during 1939 with only 10,500 tons. The volume of shipping business showed a higher activity when compared with 1938, and results were generally good, although the amount of inward cargo declined heavily in the second half-year owing to the drastic fall in exchange in June and later to the outbreak of war in Europe.

As a result of the European situation, the demand for tonnage for special purposes showed a remarkable increase. Towards the end of the year a certain shortage of tonnage for local exports was noticeable on account of lesser tonnage available. In the coastal business there was a great demand for tonnage in the last few months of 1939, resulting in the enhancement of charter rates to a con- siderable extent. Because of the depreciation of the dollar and of all the costs of running their ships, specially insurance, going up as a result of the war situation, shipping companies were compelled to increase their rates of freight, but, in terms of Hongkong dollars or sterling, freight rates on coastal services were about the same or slightly lower than those in 1938.

Imports of gold and silver from foreign countries were negligible, and there was no record of any outflow of treasure from this port throughout the year. The highest rates for sterling and U.S. dollars quoted during the year were 81d. and U.S. $16.50 respectively, and the lowest were 3d. and U.S. $6.375. The violent drop in exchange and the Government regulations limiting cash with- drawals from Chinese banks halted the ingress of many a commodity, bulk as well as luxuries. Importers who were unable to obtain sufficient foreign ex- change from the Central Bank had to buy at higher prices a demand which gave rise to what is known as the "black market," quoting exchange at much less favourable rates than those given by the Central Bank.

Concerning the Whangpoo Conservancy Board, negotiations which had been proceeding during 1938 and 1939 came to a conclusion in November, when an agreement for resumption of conservancy work was arrived at. With condi- tions in Shanghai and in the interior gradually returning to normalcy, the post office transacted a very brisk business in 1939, although operations were main- tained under difficult and extraordinary circumstances. Owing to high costs of operation, there was a general increase in the rates of remuneration for carriage of mails by the steamship companies. The acceptance of insured mail matter for European countries was temporarily suspended from September on account of the European War. A revision of the tariff for international mail matter also took place in September.