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HISTORY

foreign trade at Canton but found conditions unsatisfactory, mainly because of the conflicting viewpoints of two quite dissimilar civilisations. The Chinese regarded themselves as the only civilised people and treated all others as barbarians. Foreigners trading at Canton were subjected to humiliating personal restrictions. Confined to the factory area, they were allowed to reside only for the trading season, during which they had to leave their families at Macau. They were forbidden to enter the city and to learn the Chinese language. Shipping dues were arbitrarily varied and generally much bickering resulted between British and Chinese. Yet there was mutual trust and the spoken word alone was sufficient for even the largest transactions.

Trade had been in China's favour, and silver flowed in until the growth of the opium trade from 1800 onwards reversed this trend. The outflow of silver became more marked after 1834, when the East India Company lost its monopoly of the China trade and the foreign free traders, hoping to get rich quickly, joined in the lucrative opium trade, which the Chinese had made illegal in 1799. This led to the appointment of Lin Tse-hsu in March 1839 as special Commissioner in Canton, with orders to stamp out the opium trade. A week later he surrounded the foreign factories with troops, stopped food supplies and refused to allow anyone to leave until all stocks of opium had been surrendered and dealers and ships' masters had signed a bond not to import opium on pain of execution. Captain Charles Elliot, RN, the British Government's Representative as Superintendent of Trade, was shut up with the rest and authorised the surrender of 20,283 chests of opium after a siege of six weeks. But he would not allow normal trade to resume until he had reported fully to the British Government and received instructions. The British community retired to Macau and, when warned by the Portuguese Governor that he could not be re- sponsible for their safety, took refuge on board ship in Hong Kong harbour in the summer of 1839.

Lord Palmerston, the Foreign Secretary, decided that the time had come for a settlement of Sino-British commercial relations. Arguing that, in surrendering the opium, the British in Canton had been forced to ransom their lives--though in fact their lives had never been in danger-he demanded either a commercial treaty which would put trade relations on a satisfactory footing, or the cession of a small island where the British could live free from threats under their own flag. An expeditionary force arrived in June 1840 to back these demands and thus began the so-called First Opium War, 1840-2. Hostilities alternated with negotiations until agreement was reached between Elliot and Keshen, the new Manchu Commissioner who had replaced Lin after the latter's exile in disgrace, over the preliminaries of a treaty. Under the convention of Chuenpi, January 20, 1841, Hong Kong Island was ceded to Britain. A naval landing party hoisted the flag at Possession Point on January 26, 1841 and Elliot proclaimed Hong Kong a British Colony; in June he sold plots of land and settlement began.

Neither side accepted the Chuenpi terms. The cession of a part of China aroused shame and anger among the Chinese, and the unfortunate Keshen was ordered to Peking in chains. Palmerston was equally dissatisfied with Hong Kong which he contemptuously described as 'a barren island with hardly a house upon it' and refused