ENG-1946 — Page 42

1939 to 80% and in China 39.4%, U.S.A.

export trade. This figure declined in 1946 to 71.9% apportioned as follows: 10.9%, Siam 6%, Macao 4.4%, French Indo-China 4.2%, all other foreign countries 7%.

Factors Assisting Revival of Trade.

The comparatively rapid revival of commercial activity in and through Hong Kong was made possible and encouraged by the following factors: law and order and the legal framework within which commercial transactions could take place were re-established without avoidable delay and the physical security of goods, money and merchants became reasonably assured; the insatiable demand for food and con- sumer goods to meet the requirements of a market which had been starved for three and a half years by a regime of oppression and isolation, together with the Chinese merchants' enterprise and resource, ensured that all possible sources of supply were tapped; the port facilities of Hong Kong had fortunately not been entirely disabled during hostilities; and finally, in accordance with Hong Kong's traditional status as a free port, restrictions on trade were kept to a minimum. The market was so favourable to the sellers that there was mushroom growth of firms engaged in commercial enterprise. Many of these were new concerns set up by Chinese, British and foreign business men who had not previously traded in the Colony. The close of the year showed an increasing demand for industrial products from Europe. the U.S.A. and Australia. The demand for goods from the United Kingdom is considerable, for their quality is respected in the Far East and they can in general be sold at competitive prices in Far Eastern markets when they are available.

Price Control.

A measure of retail price control was brought into force during 1946 through the medium of the temporary Depart- ment of Supplies, Trade and Industry. This was necessarily a gradual process since in the early days of the re-occupation the only goods available were local products or goods from neighbouring parts of China and any attempt at strict price control would have discouraged their production or entry at a time when they were most needed. As goods began to arrive from the world's markets in adequate quantities, price control was gradually extended. Various means were used to enforce it, apart from straight price fixing backed by legal action. For example, goods were directed into selected retail shops which had guaranteed to sell at control prices and thus acted as a check on the market. The Supplies Department went into business and made bread, confectionery, towels and shirts which were sold under its control.