The funicular tramway to the Peak opened up that desirable district in 1888, and extensive waterworks were carried out at Tytam, the original works at Pokfulam proving inadequate.
The period that followed is noteworthy principally for extensive reclamation work and roadbuilding, in the furtherance of which Sir Paul Chater took a leading part. Earnest endeavours by the authorities to promote interest among the Chinese to acquire more than a mere smattering of English have also to be recorded, in which connexion Sir Kai Ho Kai and E. R. Belilios figured prominently. Improvements in sanitation followed the outbreak of bubonic plague, when Dr. Kitasato, working in Hong Kong, succeeded in isolating the plague bacillus and it was found that the disease was transmitted by vermin.
Under the Convention of Peking, signed in 1898, the area known as the New Territories, including Mirs Bay and Deep Bay, was leased to Great Britain for a period of ninety-nine years. The Government of Hong Kong soon embarked upon a big programme of works there. The Canton-Kowloon Railway was built, public health administration and antimalarial measures were prosecuted with determination, while Chinese and others were brought more closely into touch with the problems of government and social services. Sir Henry Blake identified himself with every aspect of the community's activities, which his successor, Sir Matthew Nathan, extended to Kowloon, where the road he laid down, called "Nathan's Folly" by local wags, commemorates his confidence in the development of Kowloon and the expanse of country contiguous with it.
The development of the Colony progressed after that at a phenomenal rate. Chinese merchants began to break away from their ancient ways, taking a more prominent part in the commercial and industrial acitivities of the Colony. They established shipping lines, built wharves and warehouses, erected department stores, set up dock- yards and factories of every kind, built theatres and invested heavily in real estate. They have formed banks and insurance companies on Western lines and established great import and export houses. Hong Kong has provided the opportunity for many Chinese and members of other races to fit into the rapidly expanding world economy of the twentieth century.
Freedom of the port and freedom of entrance and egress for all persons of Chinese race were permitted in accordance with a policy which ensured for the Colony the role of entrepôt both for the trade and for the labour of China's southern provinces.
The Government has marched ahead of needs, and thought has been taken for every feature of the Colony's amenities. Hospitals and schools abound, centres where social services are maintained, efficient policing and fire-fighting services, waterworks, port facilities, are all
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