HONGKONG TO-DAY

Otago Daily Times, Issue 22628, 20 July 1935, Page 19

HONGKONG TO-DAY

ITS APPREHENSIONS ECONOMIC NATIONALISM JAPANESE COMPETITION. The affairs of South China, in comparison with those of the north, have been somewhat neglected by writers on the Far East (says a correspondent in the Manchester Guardian). The justification for directing attention to the south lies partly in the fact that many, if not most, of the moral and political influences which gave birth to, and are developing, modern China originated in, and still draw much of their force from, Kwangtung; partly in the fact that the southern treaty ports are responsible for about a quarter of China’s foreign trade, and partly in the fact that Japan’s bid for domination in the Far East makes clear appreciation of the significance of the British colony of Hongkong important. THE COLONY. Hongkong is not only the distributing centre of British trade in South China, but a focal point of British influence in the Pacific. It is? a hilly island, 11 miles long and from two to five miles in breadth, encircled by smaller islands, and approached from the sea by deepwater channels of great variety and charm; the channels and bays which separate it from the mainland form one of the finest and most picturesque harbours in the world. High above the harbour on the north rise the bare hills of the mainland, one gaunt range lying like a barrier across the base of a flat, tongue-shaped peninsula known as Kowloon. This area and a narrow strip of the northern side of the island constitute one of the world’s most important ports, from which commercial routes radiate by sea and land in all directions. Behind Kowloon lies territory leased from China for 99 years in 1898. Including certain islands it is approximately 345 square miles in extent. The population of the port is in the neighbourhood of 1,000,000, of which non-Chinese persona*total approximately 20,000. The Government of the colony comprises a Governor, an Executive Council of six official and three unofficial members, and a Legislative Council of nine official and eight unofficial members, three of whom are Chinese, RECENT PROGRESS.

To revisit. Hongkong after an absence of nearly 10 years is to become aware of two quite different, and to some extent contradictory, sets of changes. One group comprises structural developments of impressive magnitude, a great variety of new buildings, comprising banks and other business premises of the most up-to-date kind, many new residential sites, and houses, new and spacious hotels, flats of the latest model, picture houses, factories, improved wharves and other shipping facilities, new roads, and a large increase in motor transport.

Accompanying these changes one notes a striking modernisation of Chinese districts, and a still more striking modernisation of the Chinese men and women to be seen in them. Streets, shop windows, hotel lounges, refreshment rooms —all bespeak new social standards and a liveliness, variety, and gaiety which are in striking contrast with the staidness and uniformity of 10 years ago. Accordingly, at the end of one's sightseeing, one goes to bed much impressed by the progress which the colony has made by its purposefulness, vitality, and j success. j On the other hand, the moment one > begins to look closely into local conditions one becomes aware that Hongkong; is less sure of itself than it used to be. j At the moment, indeed, notwithstanding appearances, it is in the dumps, a mood resulting largely from the fact that the colony, after a surprisingly long period of resistance, is now feeling the effects of the world depression. , As long as China kept out of it Hongkong was able to do the same. Now that China is in it Hongkong is too. Nor has she any chance of emerging till China emerges, a deliverance governed, amongst other factors, by the future of silver, the price of which is being raised artificially above that of the goods which China sells. Given a restoration of China’s capacity to sell, which is handicapped by other factors besides silver, Hongkong’s fit of the dumps will brighten into relative cheerfulness. JAPANESE COMPETITION. She is, however, less certain of herself than she used to be for reasons unconnected with these causes of depression. In describing one reason, Japanese competition, it is desirable to distinguish between the entities which arc affected lay it —that is to say, between Hongkong and the distributing centre and free port and Hongkong as represented by its British community. It might be argued that to Hongkong considered as a distributing centre and free port th’e provenance of imports is unimportant. It Is clear, on the other hand, that to Hongkong as represented by its British traders, who are the main channel for the sale of the United Kingdom’s manufactures in South China, and upon whose prosperity the welfare of the port largely depends, Japanese competition is vital. Statistics show that in 1931 Japan’s proportion of the import trade was smaller than Great Britain’s; in 1934 it was greater, notwithstanding the anti-Japanese boycott. In the event of a rapprochement between China and Japan, involving special economic arrangements —as is anticipated this fact would become still more disturbing. Hongkong’s position as a strategic centre is being revalued. Another reason for Hongkong s diminished self-assurance is to be found in China’s tariff policy and industrialisation. Ten years ago these were inconsiderable factors in her economic outlook; to-day they bulk large. They are producing two effects, of which one is general, and felt all along the China coast—namely, a progressive restriction of the import of consumable as opposed to capital goods. In this respect Hongkong is no worse off than Shanghai, except that Shanghai’s import trade is much larger and can therefore afford the restriction better than Hongkong’s. Moreover, what Shanghai loses in imports it gains in exports, for goods manufactured in and around Shanghai are being increasingly shipped to Canton and other South China ports. Goods manufactured in Hongkong, on the other hand, have to pay the same import duties as United Kingdom manufactures.

Confronted by Japan’s policy on tiie one hand and by China’s economic nationalism on the other, Hongkong’s outlook is less ample and assured than it used to be. By reason of its geographical position, however, its splendid harbour, _ its upright and orderly administration, and its financial and shipping facilities, it remains not merely one of the most substantial of British assets, but an essential makeweight in the maintenance of a Just and fair balance of commercial and other opportunites in the Far East. All the more important is it that the colony should be linked aerially with existing air routes.