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per acre. Another of 33,000 square feet costing $250,000 in 1886, sold for $500,000 in 1889 (45/- per square foot or £98,000 per acre). The price of another of the same area rose in the same period from $310,000 to $500,000, and another of 38,000 square feet which cost $310,000 in 1882, is now refused for sale at $450,000 or over 50/- per square foot. The above instances are all of Marine Lots; but I am informed on good authority that Inland Lots, of large area in the aggregate, situate in the Chinese business quarter could not be obtained at a price less than $15 to $20 (45/- to 60/- sterling) a square foot or £97,000 to £130,000

an acre.

66. In the Hill District the advance in value has been relatively even greater than elsewhere; as for instance from $2,000 in 1879 to $35,000 in 1888; $10,000 in 1882 to $46,000 in 1888; $23,000 (estimated) in 1885 to $50,000 in 1888- while Government land which could not have been sold at 5 cents a square foot within this decade, has realised at auction from 20 to 50 cents per square foot.

67. The most recent advance in Marine Lots has been probably due to the prospects of profit from the Reclamation scheme mentioned above, and that in the Hill District is, no doubt, in considerable measure owing to the Tramway from the town to Victoria Gap (1,100 feet above the sea) worked on a plan similar, I understand, to that of the Railway on Mount Vesuvius. By means of this line (which was opened in May, 1887, and which carried 148,344 passengers in its first year) residence at "the Peak" is rendered much more easy to those-and they include nearly all the male population of the neighbourhood-whose occupations require their daily presence in town. And from this and other causes the demand for houses at this high altitude has become so great that 35 have been erected within the last two years, and 39 more are in course of construction.

68. Each of these houses is built on a site more or less precipitous, the requisite level for buildings and tennis courts being obtained by blasting; and as every brick, stone, timber, and other article used in construction, as well as the furniture on completion, requires to be carried on coolies' shoulders for distances varying from one to two miles to a height of 1,100 to 1,600 feet,* it may be imagined what has been the labour and cost involved in the work, and why it is that residence at the Peak must be confined to the comparatively wealthy.

69. Another of the leading features of the most recent history of the Colony is the number of joint-stock enterprises undertaken almost entirely with local capital- to which, it may be noted, Chinese have, for the first time, begun to make considerable subscriptions in common with Europeans. Since the beginning of 1888, 35+ Com- panies have been formed, with capital already paid-up aggregating $9,508,475, for land investment, manufacture, and trade in Hongkong and for mining and planting enterprises in the Malay Peninsula, Borneo, and Tongking. So strong has been the tendency towards joint-stock investment that the shares of most of the Com- panies have been insufficient in number for the demand; and it may be mentioned as shewing the amount of capital available for the purpose that within two months of this year the sum of $4,890,000 was paid into the Hongkong and Shanghai Bank in connection with the shares of one Company. ‡

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70. As far as is known all, or nearly all, of these Companies, especially those whose field of operations is in Hongkong, have good, some of them excellent, pros- pects of success. There can moreover be little doubt that land in Hongkong will eventually be even more valuable than now. But it remains to be seen whether property in either land or shares is at present worth the high price to which it has been advanced by speculative purchase. It may indeed be taken as certain that in very few instances can the profits within the next year or two afford a fair interest on present outlay; and hence probably arise the signs of reaction which are now beginning to show themselves. If this depression of values should continue, it would no doubt cause much distress among those who have been speculating beyond their means; but any general injury is not at all likely to be other than temporary; and in a Colony having so many solid elements of prosperity it may be taken as certain that, in the absence of calamity, the wound will be very quickly healed.

* According to a return made for me by the Police there are at the present time being carried thus to "the Peak" from 2,800 to 3,000 loads per diem of bricks and other materials.

†There are 10 other Companies registered in Hongkong of which I have been unable to ascertain the paid-up Capital, making a total of 45,

The Hongkong Land Investment Company, Limited. Capital $5,000,000 of which $2,500,000 has been paid-up together with $1,250,000 premium on the 2nd issue. The sum of $1,140,000 paid for shares not allotted was returned to the applicants.