ENG-1959 — Page 398

HISTORY

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industry which came into being to replace the traditional entrepôt trade of the Colony, which has been the most significant feature, after population growth, in the Colony's history in the post-war years.

As a result of the outbreak of war in Korea in June 1950, controls were progressively introduced over the export of strategic materials, beginning with petroleum and its derivatives in July of that year. As far as North Korea itself was concerned, a complete embargo on trade of any kind with that country was introduced on 8th July. In December the United States Government placed an embargo on goods destined for Hong Kong. This seriously affected supplies of raw materials essential for much of local industry, and led, for a time, to a serious disruption of the Colony's manufactures, with the threat of widespread unemploy- ment. Fortunately, this embargo was modified by the introduction of a system of controls, which ensured supplies of these materials for legitimate use in the Colony.

In June 1951, as a result of the United Nations Resolution of 18th May 1951, a complete embargo on the export of strategic materials to China was imposed by the Hong Kong Government. This was at the time a crippling blow to local commerce and the volume of trade in that year fell by over one million tons compared with the figure for the preceding year. During 1952 the United States Government introduced controls over imports of Chinese- type merchandise from Hong Kong, and even now commodities of this kind are admitted into the United States only under strict procedures designed to ensure that they are of non-Communist origin. The entrepôt trade with China, once the Colony's mainstay, has been reduced to a trickle. Recent reductions in the scope of strategic controls have done something to improve the situation, but it is China's own economic and commercial policies which are now the limiting factor and for the foreseeable future it is upon its industry that the Colony must rely for its survival.