工商業管理處年報 Commerce and Industry Department Annaul Report 1954-1955

HONG KONG

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Library Copy No.DR.274

Date 19 MAR 1988

Library Book No. 351.0%

ANNUAL

1108

DEPARTMENTAL

REPORTS

1954-55

DIRECTOR OF

COMMERCE AND INDUSTRY

Library Book No.351.06

HONG KONG

ANNUAL DEPARTMENTAL REPORT

BY THE

DIRECTOR OF

COMMERCE AND INDUSTRY

FOR THE

FINANCIAL YEAR 1954-55

PRINTED AND PUBLISHED BY W. F. C. JENNER, GOVERNMENT PRINTER,

AT THE GOVERNMENT PRESS.

JAVA ROAD, HONG KONG.

1108

нк 574 COM 55

1108

MARINE DEPARTMEN LOKARI

Official Exchange Rates for the H.K. dollar

The official rate for conversion to pounds sterling is H.K.$16 = £1 (H.K.$11/3d.). The official rate for con- verting to U.S. dollars is H.K.$5.714 = U.S.$1 (based on £1 = U.S.$2.80) but a more realistic, though approximate, rate based on the local fluctuating open market would be nearer H.K.$5.90 U.S.$1.

}

CONTENTS

I. GENERAL REVIEW

II. THE COLONY'S TRADE

General

China Mainland

United Kingdom

Japan

Indonesia

United States of America

Thailand

Paragraphs

1 - 12

D •

•

.....

III. TRADE AND INDUSTRY ADVISORY COMMITTEE.

IV. INDUSTRIAL DEVELOPMENT

Exports of Hong Kong Products

Raw Materials

New Developments

Industrial Sites

V. TRADE DEVELOPMENT

}

General

Trade Promotion

24 - 28

38 -

•

Comprehensive Certificates of Origin Imperial Preference Certificates and

Ordinary Certificates of Origin ....

47 -

63 - 67

CONTENTS-Contd.

Paragraphs

VI. TRADE CONTROLS

Import Control

Export Control

69 72

Essential Supplies Certificates

VII.

STATISTICS

VIII.

PREVENTIVE SERVICE

73 80

81. 85

86 98

99 - 107

2288

IX. REVENUE

X. BUSINESS REGISTRATION

XI. DEPARTMENTAL TRADE ACTIVITIES

Rice

Frozen Meat

Other Foodstuffs

Coal and Coke

Firewood

Accounts

XII. WELFARE

Welfare Officer

Education

Leave

Loans

108

111

112 117

118 120

121

122

126

127

128 - 130

131

132 - 133

134

135

136

137

138

139

140

141

Working Conditions

Canteen

Sport and Recreation

Magazine

XIII.

LEGISLATION

XIV. STAFF

CONTENTS—Contd.

XV. REPORT OF THE DIRECTOR OF THE HONG KONG

GOVERNMENT OFFICE IN LONDON

Paragraphs

142

143 - 162

General

163

Controls

164

Imperial Preference

165 - 168

British Industries Fair

169 - 170

Commercial Relations

171 - 175

Public Relations

176 178

Other Matters

179 - 183

Staff

184

XVI. REPORT OF THE HONG KONG GOVERNMENT

REPRESENTATIVE IN TOKYO

General

185

Inquiries

186

Publications

187

Trade Fairs, Visits and Meetings

188

Claims

189

Other Activities

190 - 192

iii

Appendix No.

II.

III.

LIST OF APPENDICES

Comparative Table of Total Values of Imports for the Years 1953 and 1954

Comparative Table of Total Values of Exports for the Years 1953 and 1954 ...

Comparison of Volume of Trade, Hong Kong, 1954 with 1953 and 1952 (Moving Average 3 months)

Page

IV.

Values of Imports and Exports, 1954 (in

million H.K.$)

Volume of Hong Kong's Imports and Exports, 1954 (in thousand long tons) ...

VI.

VII.

Comparative Table showing the Percentage of Increase or Decrease of Quantity of Principal Hong Kong Products exported in 1953 and 1954

Comparative Table Showing Total Values of Exports of Hong Kong Products (classified separately in the Trade Statistics) for the years 1953 and 1954...

VIII. Import Licences issued for the year ending

31st December, 1954

IX.

Export Licences received and dealt with from 1st January, 1954 to 31st December, 1954

Appendix No.

LIST OF APPENDICES—(Contd.)

Page

Comparative Table showing the Number of Essential Supplies Certificates Issued during the Years 1951-1954

XI.

Comparative

Table of Numbers of

Manifests received during the Years 1953 and 1954

XII.

Comparative Table of Numbers of Declarations received during the Years 1953 and 1954

XIII.

Details of arrests, seizures and convictions during the financial year ending 31st March, 1955

XIV.

Details of main seizures of articles subject to import and export licensing under the Importation and

Exportation (Pro-

hibition) (Specified Articles) Regulations, 1952 and other regulations

XV.

Details of seizures of petroleum products...

XVI.

XVII.

XVIII.

Details of seizures of dutiable commodities.

Details of seizures of dangerous drugs

Revenue for the period from 1st April,

1954 to 31st March, 1955

XIX.

Details of duty from European-type liquor.

XX.

Details of duty from Chinese-type liquor ...

XXI.

Details of duty from liquor

LIST OF APPENDICES—(Contd.)

Appendix

No.

Page

XXII.

Details of duty from tobacco

XXIII.

Details of duty from hydrocarbon oils

XXIV. Details of duty from toilet preparations

and proprietary medicines

XXV.

Details of duty from table waters

XXVI.

Details of licences for liquor issued for the period from 1st April, 1954 to 31st March, 1955

XXVII.

Details of licences for tobacco issued for the period from 1st April, 1954 to 31st March, 1955

XXVIII.

XXIX.

XXX.

XXXI.

Details of licences for hydrocarbon oils issued for the period from 1st April, 1954 to 31st March, 1955

Details of licences for toilet preparations

and proprietary medicines issued for the period from 1st April, 1954 to 31st March, 1955

Details of licences for table waters issued for the period from 1st April, 1954 to 31st March, 1955

Summarized Accounts, Supplies Division...

I- GENERAL REVIEW

1. In terms of value the Colony's trade in 1954 declined by 11% as compared with 1953. Imports and exports for the year 1954 were valued at $5,852 million, a reduction of 11% ($754 million). Both imports and exports fell by the same percentage. The value figures alone do not, however, give a true picture of trade during the year. Cargo tonnages in fact increased from 5,021,866 tons in 1953 to 5,176,256 tons in 1954. A breakdown of imports and exports shows that the latter were the same as in 1953, 1.55 million long tons, while imports actually increased by 0.2 million long tons over the 1953 total of 3.5 million. This apparent anomaly indicates a general falling off in prices and reduced profits during 1954, rather than a further fall in the level of trade. It is evident, in fact, that the deflationary trend which set in in 1953 continued during 1954.

2. One of the bright features of trade was a further increase in the value of exports of Hong Kong products from $635 million in 1953 to $662 million in 1954. This increase was relatively small, but taking price reductions into account, it is probable that the volume of exports of local products was con- siderably higher than previously. Indeed, 28% of all exports from the Colony consisted of local manufactures. There are good signs that such trade will continue to increase.

3. The Trade Development Division set up in August, 1953, continued to expand its activities during the year under review, with particular emphasis on making the possibilities of trade with Hong Kong more widely known overseas and improving the reliability of Hong Kong Government Certificates of Origin for locally manufactured commodities. An additional 17 items of Chinese-type goods made in the Colony were cleared for export to the United States under Comprehensive Certificates of Origin.

Improvement in the monthly "Trade Bulletin" con- tinued to be made and during the year the overseas distribution of this publication was stabilized at 8,000 copies. In addition, some 1,250 copies were sold in the Colony each month.

5. The Twelfth Annual Exhibition of Hong Kong products, organized by the Chinese Manufacturers' Union, was held from 16th December, 1954, until 12th January, 1955. The Exhibition was once more opened by His Excellency the Governor. Again there was a new record of attendance, exceeding one million, and including a number of important delegations from overseas. The Exhibition coincided with the Meeting of the E.C.A.F.E. Sub-Committee on Trade held in Hong Kong from 6th to 12th January, 1955, and the opportunity was taken by the Chinese Manufacturers' Union to arrange for members of delegations from other countries to be conducted around the Exhibition and to be entertained.

The Exhibition was on a larger scale than before and contained a record number of 654 stall units. There was again a general display section, this time comprised of 1,400 show cases, giving the overseas visitor a comprehensive view of nearly all products manufactured in the Colony.

7. The 1954 British Industries Fair was held in London, at Earl's Court, from 3rd to 14th May, and the Colony was represented at this Fair for the seventh year in succession. Considerable interest was shown in the wide range of products on display at the Hong Kong stand and no less than 638 inquiries were recorded a new record. The opportunity was taken to distribute various publications about Hong Kong, including 500 copies of the Hong Kong Directory specially produced for the Fair. As mentioned elsewhere (paragraph 55), an additional 5,000 copies of the Directory were distributed by the depart- ment to suitable addresses overseas. Thanks are due to all members of the official delegation to the Fair, which was led by Mr. J. D. Clague, C.B.E., M.C., for their able representation of Hong Kong's interests and the assistance which they rendered at the stand. Acknowledgment must also be made to the Hong

Kong British Industries Fair Committee for their hard work and sound advice in connexion with preparations for the Fair, and to visitors from Hong Kong to the Colony's stand during the period of the Fair, whose assistance relieved the staff of the Hong Kong Government Office in London of much onerous work in manning the stand and answering inquiries.

8. In October, 1954, the former Hong Kong British Industries Fair Committee was dissolved by its own resolution, and on its advice its assets were handed over to Government which assumed financial responsibility for the Colony's parti- cipation in future British Industries Fairs. The functions of the former Committee were taken over by the Trade and Industry Advisory Committee on 5th November, 1954, which authorized the department to handle the arrangements for a Hong Kong display at the Fair in May, 1955, on the advice of the Committee and in co-operation with the Director of the Hong Kong Government Office in London. At the end of the year under review preparations for the display at the 1955 British Industries Fair had reached an advanced stage.

9. Measures to improve the efficiency of the Preventive Service continued to be taken during the year,

10. Revenue collected from all sources during the year under review reached a new record total of $93,191,786.35.

11. The activities of the Supplies Division may be said to have reflected the gradual improvement which has taken place in the world supply position. The shortages of the immediate post-war period, which of necessity dictated a policy of Govern- ment trading in certain essential commodities, have slowly been made good. As a result, it was possible during the year to bring to an end direct participation by Government in the rice, coal and frozen meat trades. Although the phase of actual shortages is passing, the risk of shortages remains, and the former system of direct participation has therefore been replaced by one of controls, which represent only a "half way house" in the direction of complete freedom of trade. The basis of

these controls, in each of the three commodities concerned, has been the return of the trade to a restricted number of importers, who hold precautionary reserve stocks in proportion to the import quotas which have been allocated to them. Legislative sanction for this new system of control was provided by the Importation and Exportation (Reserved Commodities) Regula- tions, 1954, brought into force on 30th November, 1954.

12. The department continued to maintain close and effective liaison with the Director of the Hong Kong Govern- ment Office in London and the Hong Kong Government Representative in Tokyo, and with trade commissioners and foreign consular officials in Hong Kong. The reports of the Director of the Hong Kong Government Office in London and the Hong Kong Government Representative in Tokyo are at Chapters XV and XVI respectively. Relations with merchants and manufacturers in Hong Kong remained as cordial as usual, and in this connexion tribute is due to the various Chambers of Commerce and the Chinese Manufacturers' Union for the advice which they have given to the department from time to time, particularly through the medium of the Trade and Industry Advisory Committee, and for their continued willing- ness to assist the department in all its activities.

General

II- THE COLONY'S TRADE

13. Monthly values of imports and exports are shown in Appendices I and II at page 47. The remarks which follow relate to trade in the calendar year 1954.

14. Despite some improvement in the latter part of the year, the value of trade in 1954 showed a slight decline com- pared with the value in 1953. The total value of imports and exports in 1954 was $5,852 million, a fall of $754 million (11%) from the 1953 figure. (In fact, both imports and exports fell by 11% in 1954). Cargo tonnage, however, increased from 5,021,866 tons in 1953 to 5,176,256 tons in 1954, indicating that

)

there had been a decline in commodity prices and that the value figures were not an accurate indication of the success of the year's trading.

15. The principal sources of the Colony's imports in 1954, in order of importance, were China, Japan, the United Kingdom, United States, Malaya, and Western Germany, while the chief markets for Hong Kong's exports were China, Malaya, Indonesia, the United Kingdom, Thailand and Japan. The only one of these countries which showed an increase in total trade was the United States, with increased values for both imports and exports over the 1953 totals.

16. Textile yarns and fabrics imported during the year were valued at $555 million, and were followed in order of importance by textile fibres $259 million; fruits and vegetables $197 million; live animals for food $154 million; cereals and cereal preparations $146 million; dyeing and tanning materials $129 million; and mineral fuels and lubricants $127 million. The principal exports were textile yarns and fabrics $496 million; clothing $265 million; dyeing and tanning materials $151 million; animal and vegetable crude materials $140 million; and fruits and vegetables $129 million.

17. Graphs illustrating the Colony's trade are at Appen- dices III, IV and V (pages 48, 49 and 50). The first shows the value of trade on a three months moving average for the years 1952, 1953 and 1954, while the others show the value and volume of trade respectively for each month of 1954.

China Mainland

18. In value, imports from, and exports to, China were much below the 1953 levels. Imports fell by 19% to $692 million and exports by 28% to $391 million. The principal differences were reduced imports of fruits and vegetables,

textile fibres, and animal and vegetable oils; while exports to

China of manufactured products and pharmaceuticals were on a reduced scale.

United Kingdom

19. Imports from the United Kingdom declined from $474 million in 1953 to $369 million in 1954, a reduction of 22%. There was, however, a considerable increase in the value of goods exported to the United Kingdom, consisting largely of Hong Kong manufactures, and total exports in 1954 amounted to $162 million as compared with $119 million in the previous

year.

Japan

20. The removal in January, 1954, of restrictions on the importation of Japanese goods into the Colony and their re-export to any destination resulted in a 21% increase in the value of imports from Japan during the year. Imports rose to a total of $464 million. On the other hand, exports to Japan declined from $221 million in 1953 to $114 million in 1954, a fall of 48%.

Indonesia

21. There was a further fall in the value of exports to Indonesia, the total for 1954 being $224 million, a decline of 40% compared with the 1953 figure.

United States of America

22. The value of imports from the United States rose from $225 million in 1953 to $281 million in 1954, and the value of exports from $62 to $70 million. Part of the increase in exports can be attributed to the release of more items of locally- manufactured Chinese-type products for shipment to the United States under the Comprehensive Certificate of Origin system.

Thailand

23. Trade with Thailand showed a considerable decline. Imports fell from $290 million in 1953 to $131 million in 1954, and exports from $206 to $130 million. The principal changes were reduced imports of cereals ($85 million as compared with $247 million in 1953) and reduced exports of fruits and vegetables, textile yarns and fabrics, metal manufactures, clothing and footwear.

III — TRADE AND INDUSTRY ADVISORY COMMITTEE

24. This Committee, which was appointed on 1st January, 1954, in place of the former Trade Advisory Committee, has the following terms of reference:-"To advise the Director of Commerce and Industry on all matters, other than labour, which affect the Colony's trade and industry." It consists of the Director of Commerce and Industry, as Chairman, one representative each from the Hong Kong General Chamber of Commerce, the Chinese General Chamber of Commerce, and the Chinese Manufacturers' Union, and two members appointed by the Colonial Secretary. The Secretary of the Department of Commerce and Industry is the Secretary of the Committee. The Chairman is empowered to co-opt advisers and to appoint sub-committees.

25. The following changes in membership occurred during the year under review:-Mr. J. H. Hamm acted as representa- tive of the Hong Kong General Chamber of Commerce from May to September, during the absence of Mr. J. D. Clague, C.B.E., M.C. On 1st January, 1955, and until the end of the year, the Committee was constituted as follows:-

The Director of Commerce and Industry (Chairman) Hon. Kwok Chan, O.B.E. and Mr. J. H. Hamm,

representatives appointed by the Colonial Secretary. (Mr. Hamm replaced Mr. J. Finnie). Mr. J. D. Clague, C.B.E., M.C., representative of the

Hong Kong General Chamber of Commerce.

Mr. Singnam Choy, representative of the Chinese General Chamber of Commerce (in place of Mr. Wong Ping Ying).

Mr. U Tat Chee, O.B.E., representative of the Chinese

Manufacturers' Union.

26. The Committee met twelve times during the year and gave valuable advice on a wide range of subjects, including (to name only some) industrial development; industrial manage- ment; participation in the British Industries Fair, 1954, and other trade fairs overseas; the 12th Annual Exhibition of Hong Kong Products; problems concerning specific local industries and trade with specific countries abroad; trade controls; Merchandise Marks; posters and firms concerning local industry; and publications, including the Trade Bulletin and the Commerce, Industry, and Finance Directory, 1955. A Sub- Committee was formed in July, 1954, to advise on the publica- tion of the Directory and rendered considerable assistance to the department in this respect.

27. The Export Trade Development Sub-Committee set up in January, 1954, (paragraph 54 of my Report for 1953/54), to suggest ways and means whereby the department could assist in developing trade by improving standards and eliminating inferior shipments of products, reported to the full Committee in May, 1954. On the advice of the full Committee, the Hong Kong General Chamber of Commerce was asked to initiate action, in co-operation with the Chinese General Chamber of Commerce and the Chinese Manufacturers' Union, on the formation of a Hong Kong Exporters' Association comprised of reputable merchant houses and manufacturing concerns with satisfactory export departments. Work on the establishment of

the Association was nearing fruition at the end of the year.

28. I gladly acknowledge my sincere thanks to all Members of the Trade and Industry Advisory Committee for devoting so much of their time and energy in assisting the department with their advice and providing an effective means of liaison with local commercial and industrial interests.

)

IV — INDUSTRIAL DEVELOPMENT

Exports of Hong Kong Products

29. A notable feature of trade in 1954 was a further increase in the value of exports of Hong Kong manufactured goods. The figure rose from $635 million in 1953 to $682 million in 1954, the proportions by value of all exports from the Colony being 23.2% and 28% respectively.

30. The modest increase of $47 million in 1954 over the 1953 figure does not, however, give a complete picture of the gains made during the year by local industry, for many Hong Kong products decreased in price in 1954 and foreign buyers were getting more for their money. A comparison on the basis of quantity of exports shows that considerable progress was made in 1954 in certain well-established lines, such as paints and varnishes, footwear and vacuum flasks.

31. A comparative table showing the percentage of increase or decrease of quantity of principal local products exported in 1953 and 1954 is at Appendix VI (page 51). The cause of the fall in prices mentioned above was undoubtedly keen com- petition--both locally and overseas.

32. Exports of Hong Kong products to markets in South East Asia declined considerably during 1954. Both Indonesia and Thailand found it necessary, for economic reasons, to curtail imports, and imports by Pakistan were also on a lower scale than in 1953. North Borneo, however, showed a greater interest in the Colony's products, and there was too a very marked increase in the value of goods exported to South Korea.

33. The growing success of Hong Kong products in British East and West Africa and in South Africa was particularly apparent and this offset losses in other markets. A favourable reaction in Central and South America was also noticeable. The most encouraging feature of all, however, was the sub- stantial increase in the quantity of locally manufactured goods

sold to the United Kingdom, Australia and New Zealand. While price is always an important selling feature of goods from Hong Kong, these markets demand quality too, and no better advertisement for this can be found than the large repeat orders being placed by buyers in these countries.

34. The three largest buyers of Hong Kong products during the year were, in order of importance, Indonesia, the United Kingdom, and Malaya. A table showing total values of exports of Hong Kong products for the years 1953 and 1954 is at Appendix VII (page 52).

Raw Materials

35. Difficulty in obtaining black sheet waste waste and borax continued, the former accentuated by a sudden over- development in the enamelware industry which was being corrected at the end of the year by natural economic forces.

36. Rolling mills continued to operate below capacity, although more iron and steel scrap was available, including scrap from old ships purchased for breaking up. Some export orders for reinforcing bars were lost through temporary shortage of raw materials.

37. Despite an increase in the world production of aluminium, there was still an unfulfilled demand for this com- modity in the Colony. Sulphur became easier to obtain, but not to the extent that re-export from the Colony could be considered. Adequate stocks of nickel and commodities contain- ing chrome and cobalt were acquired.

New Developments

38. The steady rise in the number of factories and work- shops registered during the year with the Labour Department under the Factories and Workshops Ordinance was reflected in the increase in factories registered with the Department of

)

Commerce and Industry for Certificates of Origin. Among the new items manufactured in the Colony, which were recorded during the year, adding to the already wide range of local products, were automatic kerosene water heaters, air condi- tioners, cigarette lighters, imitation pearls, plastic-coated rattan and seamless torch cases. Cotton spinning, one of the Colony's major industries, continued to expand steadily and over 274,000 spindles were in operation at the end of March, 1955.

39. The advances made in local industry are too numerous to record in detail, but the following are worthy of special mention. In April, 1954, a new electric clock factory received its first substantial orders. In June, the local shipbuilding industry was encouraged by the award of a contract for the building of ten diesel trawlers for the United Nations' Korean Reconstruction Agency, and in the same month a new worsted mill, capable of producing 2,000 lbs. of yarn a day, started operation. In July a new factory for manufacturing tee-shirts and underwear from fully combed yarn came into existence. A knitting needle factory opened in September, and a large modern flour mill, the first of its kind in the Colony, also began produc- tion that month. In October plans were announced by a leading spinning mill to establish a zip fastener factory on a large and scientific scale.

40. The potential production of aluminium articles rose by the establishment of an additional rolling mill and the conversion of some enamelware plants to production of aluminiumware. Machinery was ordered to enable precision die-casting of metal objects to be undertaken and for the vacuum metallization of plastic and other articles. Plans were under consideration for increased manufacture of pressure lamps and incandescent gas mantles, and one new mantle factory came into operation in December, 1954. The output of plasticware continued to expand, mainly in cottage-type establishments. Modernization of machinery gained further ground, with increasing replace- ment of line shafting by direct drive.

41. Apart from the trawlers mentioned above, local ship- yards were also engaged on building craft for the Hong Kong Government and other Governments, as well as for local ferry companies. Work in hand by the larger shipbuilding concerns in the Colony included two motor vessels of 5,790 gross tons each, powered by two 4450 BHP Taikoo-Doxford diesel engines, and two 150 tons self-propelled oil fuel bunkering lighters.

42. Mention is also made here of the enterprise shown in the less mechanized industries in the Colony, such as embroidery, ivory and wood carving, and many types of handmade novelties, which are gaining popularity abroad and are eagerly sought by tourists who visit the Colony. They continued to represent the other side of the Colony's character and skill which is based upon its Chinese craftsmen.

43. The Colony's manufacturers show confidence in their future and there is every reason to suppose that local industry will expand still further if its products are not arbitrarily excluded from overseas markets.

Industrial Sites

44. The report of the Inter-Departmental Committee set up in January, 1954, to investigate the development of new indus- trial sites in the Colony was submitted to the Governor in Council in July, 1954. This was followed by an announcement in August that Government would reclaim from the sea a total area of about 140 acres at Kun Tong on the eastern shore of Kowloon Bay for the provision of such sites. The first two stages of this scheme comprise the reclamation of about 78 acres of land, and it is expected that 59 acres will become available by 1957, as follows:-17 acres for allocation early in 1956, an additional 26 acres towards the end of 1956, and a further 15 acres in 1957. At the end of the year under review the method of disposal of sites to applicants was under close consideration.

General

―

MARINE DEPARTM

TRADE DEVELOPMENT

LORARY

45. The activities of the Trade Development Division, which was set up in August, 1953, continued to expand. During the year two new Trade Officers assumed duty (the first in November, 1954, and the second in March, 1955), one for Trade Development and the other for Industrial Development. (There was a temporary Trade Officer appointment by secondment from the Executive Grade from January until June, 1954). It was not possible, however, to initiate any large-scale work on industrial development before the end of the year.

46. Under

an Assistant Director and the two Trade Officers, the Division continued to function in the three Sections dealing with

(a) Trade inquiries and trade promotion generally;

(b) Comprehensive and other similar Certificates of Origin for locally-produced Chinese-type goods exported to the United States; and

Trade Promotion

47. The Section concerned with Trade Promotion generally dealt with inquiries and commercial disputes, arranged factory tours and contacts for business visitors to the Colony, edited the monthly Trade Bulletin, assisted in the preparation of other publications issued by the department, distributed trade and other literature about Hong Kong, and assisted in the planning, selection and display of exhibits of local products overseas.

48. In September, 1954, the printing and publication of the monthly Trade Bulletin from material supplied by the depart- ment was handed over to a local advertising firm, and, with a view to making the Bulletin self-sustaining, commercial

advertisements were accepted. Further, a charge of $1 a copy (or $10 for an annual subscription) for the local edition of the Bulletin was made. The appearance and the contents of the Bulletin were gradually improved and it appears to have been successful in attracting more interest from abroad in the possibilities of trade with Hong Kong. Overseas distribution of the Bulletin was stabilized at 8,000 copies, most of which are distributed to Chambers of Commerce, business concerns and Government organizations. At the end of the year about 1,250 copies of the Bulletin were being sold in the Colony each month.

49. In June, 1954, on the advice of the Trade and Industry Advisory Committee, it was decided to produce a new Directory combining the functions of the former Hong Kong British Industries Fair Directory and the Commercial Guide. The Committee advised that revenue derived from this new publica- tion should be spent on trade promotion, and in particular on participation on a Colony basis in trade fairs overseas. A Sub- Committee was set up in July, 1954, to advise on the production of the 1955 Directory and rendered considerable help in this connexion. By the end of the year under review the Directory was nearing completion.

50. The Section continued to build up a Commercial Reference Library and all new books and publications received were mentioned in the Trade Bulletin. Local businessmen showed an increasing interest in the facilities afforded by the department.

51. No less than 1,200 copies of the Annual Report on Hong Kong, 1954, were distributed to appropriate addresses overseas or handed out to business visitors to Hong Kong. In addition, 10,000 copies of the Government booklet, "Hong Kong", prepared by the Public Relations Office, were similarly dis- tributed, and numerous requests from overseas for copies of the "Commercial Guide, 1953", and the Hong Kong British Industries Fair Directories for 1953 and 1954 were met. Literature on the Colony was also supplied for the use of passengers on the luxury liners "Kungsholm" and "Caronia"

which called at Hong Kong in the early part of 1955 during world cruises. In November, 1954, a representative selection of Hong Kong products was prepared for exhibition in the United States by special arrangement with North West Orient Air Lines. This Company kindly undertook to exhibit the goods at various of their offices in the United States and reports indicated that these displays had aroused considerable interest.

52. At the end of the year under review arrangements were in hand for the provision of a comprehensive Colony exhibit at the Canadian International Trade Fair in Toronto in May/June, 1955.

53. The Assistant Director (Trade Development) was appointed as an alternate delegate in the Hong Kong Delegation to the Meeting of the E.C.A.F.E. Sub-Committee on Trade held in Hong Kong from 6th to 12th January, 1955. The oppor- tunity was taken to distribute trade and other literature about Hong Kong to the 28 delegations from other countries which attended the Meeting.

54. For the first time 3,500 Christmas cards were produced and despatched to suitable addresses overseas. The cards con- tained a photograph showing ships unloading at wharves in the harbour and a seasonal message from the department. Several appreciative letters were received in reply.

55. Assistance was once again given to the Chinese Manu- facturers' Union in its preparations for the Annual Exhibition of Hong Kong Products, as well as to the Hong Kong British Industries Fair Committee, 1954, in arranging for the packing and despatch to London of exhibits for the Fair held' in May of that year.

Five hundred copies of the Hong Kong Directory prepared for the British Industries Fair were sent to London for distribution from the Hong Kong stand. Another 5,000 copies were sent by the department to appropriate addresses

overseas.

56. Numerous overseas visitors called at the department during the year under review and every effort was made to help them regarding business contacts, visits to local factories, etc.

Comprehensive Certificates of Origin

57. There was a steady increase in the number of Com- prehensive Certificates of Origin issued for Chinese-type exports to the United States of America. In particular, Tourist Certi- ficates of Origin were in greater demand.

58. In December, 1954, arrangements were made for the introduction of a new type of Certificate, entitled "Gift Plan" Certificate of Origin, for bona fide gifts sent from Hong Kong to the United States and its dependencies. The cost of this new certificate is $5 and it is available for purchases up to the value of $500 in establishments approved for the purpose by the department.

59. The number of locally manufactured Chinese-type items cleared for export rose from 49 to 66 in the year under review.

60. The United States authorities released no additional items in the period August, 1954,-March, 1955, but at the end of the year there were indications that additional items would shortly be added to the list detailed below: —

Abacuses

Apricots, preserved

Bean curd, wet or dried

Beans, salted

Bean thread

Brass trays and novelties

Cabbage, dried white

Cane webbing

Confectionery

Cork pictures

Cotton goods, e.g.,

Piece goods

Cloth gloves

String gloves

Waste

Yarn

Wearing apparel, etc.

Cucumber, bitter

Dolls

Dried molluscs

Ducks, preserved

Embroidered footwear

Embroidered goods of linen or cotton or mixed cotton and linen Embroidered religious vestments

Firecracker punk

Fish, i.e.,

Canned spotted fish

Dried fish maw

Fish gravy

Salted dried fish

Ginger, preserved, made from Hong Kong or Japanese ginger Hardwood furniture, including camphorwood chests

Iron and tin pictures

Ivory manufactures

Jade, i.e., greed jade, cut and polished jade, and jade stones

on which designs have been cut

Japanese porcelain decorated in Hong Kong

Japanese silk handkerchiefs hand rolled in Hong Kong

Joss candles

Lychees

Mats and squares of Formosan seagrass

Mustard, preserved

Needlepoint tapestries

Oysters and oyster sauce

Paper novelties

Pewter and tinwear novelties

Pincushions

Plum sauce

Plums, preserved

Radishes

Rice powder and rice sticks

Sandalwood fans

Sauce, bean, soy and hoi sin Shrimp, i.e.,

Dried shrimp slices

Shrimp noodles

Shrimp sauce and paste

Silk and rayon folding wastepaper baskets

Silk and rayon lanterns

Silk made-up garments

Silk piecegoods

Sugar, slab and white rock

Taro

Tea, China type from Formosa Tungsten ores and concentrates

Turnips, preserved

Water chestnuts

Waterchestnut powder

Wheat starch

Wine, Chinese, non-medicinal

61. The following table shows a comparison between the certificates issued in the years 1953 and 1954:-

Comprehensive Certificates of Origin (includ- ing Tourist Certificates and "Gift Plan" Certificates)

1953

1954

8,212 21,463

62. In addition this Section issued ordinary Hong Kong Government Certificates of Origin for exports to the United States not affected by the Foreign Assets Control Regulations of the United States Treasury Department.

Imperial Preference Certificates and ordinary Certificates of

Origin

63. During the year under review there was mounting criticism against imports of Hong Kong products into various countries, particularly in the United Kingdom, including many false allegations that goods exported had not been manufactured in Hong Kong. It was necessary, therefore, in view of the

)

steadily growing demand for Imperial Preference Certificates and ordinary Hong Kong Government Certificates of Origin, to pay very close attention to applications for these Certificates, in order to ensure that they were genuine and increase the confidence in them of overseas customs authorities. Much correspondence took place with customs authorities all over the world, but particularly in the British Commonwealth, regarding the rigorous system of control and inspection under which these certificates are granted. The Director of the Hong Kong Government Office in London played an important part in answering allegations made in the United Kingdom and in main- taining effective liaison with H.M. Customs and Excise. The system of factory registration and inspection in connexion with the grant of Imperial Preference Certificates and Certificates of Origin was overhauled and improved, and the names of many factories which had ceased to exist or had moved to other addresses in the Colony were deleted from the list. At the end of the year the number of factories registered was approxi- mately 2,200, which number included many new registrations.

64. No less than 10,680 inspections of factories or ship- ments of products were carried out during 1954 in connexion with the grant of Hong Kong Government Certificates of Origin of all kinds.

65. The following table shows the increase in Certificates of Origin and Imperial Preference Certificates issued in 1954 as compared with 1953:

Certificates of Origin and Imperial Preference

Certificates

1953

1954

84,049 121,580

66. Total revenue collected for all types of certificates in 1954 was $920,810 as compared with $551,825 in 1953.

67. Special care was taken to deal with cases of abuse of the system of granting Hong Kong Government Certificates of of Origin and during the year a number of successful prosecu- tions against manufacturers and firms were made. With the

increasing co-operation which has been given by overseas customs authorities, it is hoped to eradicate the malpractices of a small number of local merchants and manufacturers who are continuing to do very serious harm to the Colony's good name in the world of trade.

Import Control

VI — TRADE CONTROLS

68. Import licences issued during 1954 totalled 73,632, compared with 92,673 issued in 1953 and 82,773 in 1952. The decline was not due to less importing, but to the extension in November, 1953, of the General Import Licence to cover more countries, thus reducing the number of special licences required. A breakdown by countries is given at Appendix VIII (page 53).

Export Control

69. The total number of export licences issued during 1954 was 178,669, the highest figure yet recorded and an increase of 16,717 over that for 1953. The monthly average in 1954 was 14,889 licences. A breakdown by groups of commodities and months, with the previous year's figures for comparison is shown at Appendix IX (page 54).

70. A few minor changes were made in the licensing procedure and on 12th May, 1954, in order to conform with certain Exchange Control relaxations, a new system of number- ing was introduced under which certain licences were prefixed with either R.E. or R.L. signifying values exceeding, or less than, H.K.$4,000 (£250).

71. During August, 1954, licensing was extended to cover all exports by parcel post to non-Sterling areas. Owing to the large number of licences involved and the increase in the volume of work, the scope of this control was reduced on 4th September to cover only goods exceeding H.K.$400 in value, except where the goods were specifically subject to licensing.

)

72. On 28th March, 1954, a number of articles which had

been controlled for many years on account of exchange or supply reasons were removed from the schedule to the Prohibited Export Order, 1946.

Essential Supplies Certificates

73. A total of 15,466 Essential Supplies Certificates were granted during the year, out of 17,539 applications received. Comparative figures from 1951 are:-

E. S. C's Monthly Issued Average

1951

1952

1953

1954

Applications

17,750

14,323 1,193

13,865

11,882

990

17,652

15,717

1,308

17,539

15,466

1,289

74. Appendix X at page 55 shows a breakdown among countries of origin for 1954 and previous years.

75. The number of inspections of factories and other investigations carried out by Preventive Service staff on behalf of the Essential Supplies Certificate Section during 1954 was 2,213.

76. On 1st April, 1954, the procedure for importing strategic type commodities for retail sale was considerably simplified by confining the controls to importers and abolishing form-filling and checking by dealers. At the same time, certain other modifications were made which gave importers greater freedom to import for retail sale. On 21st January, 1955, the procedure was further slightly modified. Import procedure for endusers of strategic commodities remained unchanged through- out the year, except that some thirty commodities were removed from control altogether and a few others were added.

77. On 2nd April, 1954, a comprehensive list of non- strategic chemicals was published for the guidance of local merchants.

78. In October the Essential Supplies Certificate Section was reorganized and the process of examining and recording applications and issues streamlined. This enabled applications to be dealt with more quickly and staff to be reduced slightly.

79. The oil bunkering of all vessels other than fishing craft continued to be controlled by this Section.

80. Details of new factories and industrial development were collected by the Section and passed on to other interested sections in the department, as well as to other departments of the Government.

VII

STATISTICS

81. A total of 592,148 import and export trade declarations was received by the Statistical Office during 1954, as compared with 627,074 in 1953. Itemized and summarized trade statistics were compiled within a few days of the end of each month, and throughout the year printed trade statistics were available to the public within a month of the period to which they related.

82. Revenue derived from trade declarations, landing certificates and ships' manifests, and from statistical services rendered to firms, etc., totalled $600,318 during the year. Tables showing numbers of manifests and trade declarations received each month during 1953 and 1954 are at Appendices XI and XII (pages 56 and 57).

83. Besides trade statistics, the work of the office included routine services for the Royal Observatory, the Urban Services Department, and the Criminal Investigation and Traffic Branches of the Police Force, returns to the United Nations and its specialized agencies, the collection of local commodity prices and the compilation of the Retail Price Index, and the preparation of the Statistical Supplement to the Government Gazette. An analysis of tuition fees in schools in the Colony was made for the Education Department, together with a tabulation of pupil according to age and sex.

T LIBRARY

84. The services of the Office were placed at the disposal of the United Nations' Refugee Survey Mission under Dr. Edvard Hambro and statistical analyses were completed in respect of more than 17,000 persons interviewed in this connexion.

85. The Retail Price Index figures for the end of each quarter of 1954, on the basis March 1947 100, were as follows:-

March June

Septem- Decem-

ber

I. Food (including drink)

130

124

132

119

II.

Rent

104

119

III.

Clothing (including footwear)

IV.

Fuel, light and cleaning:

(a) Fuel

109

102

101

104

(b) Electric Light

Other Items:

(1) Education

138

(ii) Tobacco and Cigarettes

113

(iii) Doctors and Medicines

107

106

(iv) Fares

100

(v) Household equipment

113

111

(vi) Hairdressing

122

121

120

122

(vii) Newspapers and Stationery

173

153

(viii) Shoe Repairs

(ix) Rates

100

GENERAL RETAIL PRICE INDEX

(March, 1947 = 100)

120

118

122

115

VIII - PREVENTIVE SERVICE

86. The Preventive Service continued to be fully stretched during the year in enforcing regulations affecting trade and industry and curbing the activities of smugglers. In addition to the creation on 1st April, 1954, of the new post of Deputy Chief Preventive Officer, the overall strength of the Service was

increased by the appointment during the year of twelve Revenue Officers. Details of arrests, seizures and convictions are given at Appendix XIII (see page 57).

87. The controls over strategic commodities were main- tained during the year with little alteration. Although smug- gling tended to decrease as a result of Mainland China's increasing dependence on direct shipments from Europe, the number of seizures was higher than in the previous year.

88. In the early part of 1954, oil smuggling, which had virtually ceased during the two previous years, started up again. A detailed list of seizures of strategic commodities is given at Appendix XIV (page 59) and of petroleum products at Appendix XV (page 60).

89. As in previous years, much of the time of the Preven- tive Service was employed in connexion with the Dutiable Commodities Ordinance. Seizures under this Ordinance in- creased considerably during the year and details are given at Appendix XVI (page 60). In October, 1954, there occurred the highest single haul of tobacco stems ever made, when 2 tons 11 cwts. were seized on a junk. Illicit distilleries continued to give trouble and a total of 579 stills were seized, involving 40 arrests and the confiscation of 2,164 gallons of fermenting material. Some of the licensed distilleries required constant supervision.

90. Dangerous drugs seizures declined somewhat, but the setting up, towards the end of the year, of a Narcotics Bureau in the Police Force, charged with the general direction of anti- narcotic measures in the Colony gave promise of better results in future. A special section of the Preventive Service was organized to work in collaboration with the Narcotics Bureau. On 3rd January, 1955, two plaster figures were found on examination by Revenue Officers at Kai Tak Airport to contain 125 grammes of heroin powder and 3,116 grammes of morphine powder. Details of seizures are given at Appendix XVII (page 61).

)

91. The import and export of gold continued to be totally prohibited, except when in transit, and a fair number of seizures was made during the year.

92. On the industry side, Preventive Service staff continued to carry out inspections in connexion with Essential Supplies Certificates for strategic commodities required by local manu- factures, and for Hong Kong Government Certificates of Origin of all kinds for exports of locally-made goods. It was necessary to treble the outdoor staff employed on this work.

93. An increase in offences against the Merchandise Marks and Trade Marks Ordinances was observed during the year. Prosecutions were undertaken in some cases by Government and in others by private persons or firms after Preventive Service or Police officers had made the initial seizure of offend- ing goods.

94. Anti-smuggling guards continued to be supplied for certain Shipping Companies, and Load and Draught Certificates were prepared throughout the year in conjunction with the Marine Department in respect of certain ships clearing for Mainland China.

95. One extra launch (a Motor Fishing Vessel) came into service in April, 1954, bringing the total number in use up to six, including one on loan from the Marine Department. Owing to frequent breakdowns, however, not more than five vessels and sometimes only four, were operating at any one time. Four new launches of improved design were ordered; three to be built in Hong Kong and one in Singapore. The VHF Radio-telephone equipment fitted to four of the existing launches proved useful.

96. A total of 2,294 ocean going vessels were inspected and 6,432 native craft searched within and outside the harbour limits. In addition, the Macau ferry boats were searched daily.

97. The vehicle establishment remained at nine, including the office car, and was barely sufficient to meet the increased needs of the department. Two old and worn out vans were replaced in February, 1955, and two more Land Rovers were ordered for delivery later in 1955. Both new vehicles are to be fitted with Radio-telephone equipment.

98. The discipline and morale of the Preventive Service continued to improve. A simplified drill book was brought into use in December, 1954. The whole Service was paraded for inspection twice during the year, in June and in December.

IX · REVENUE

99. The total net revenue from all sources collected during the year under review was $93,191,786.35, an increase of $5,283,063.86 over the figure for 1953/54 and the highest figure ever recorded. It exceeded by $3,130,267.40 the previous record achieved in the year 1952/53. Details are given in Appendix XVIII to XXX (pages 62 to 69).

100. The following tables show revenue from dutiable com- modities only in the years 1953/54 and 1954/55:—

1954/55 $19,411,374.44

10,234,787.44

Hydrocarbon oils

1953/54 $16,742,842.71

Imported liquor

10,768,142.51

Perfume spirits

386,479.39

365,466.98

Tobacco

34,753,820.61

35,931,744.29

Locally manufactured liquor..

7,180,995.23

7,861,671.94

Toilet preparations and

proprietary medicines

3,360,142.44

3,187,457.71

Table waters

1,691,040.44

1,902,654.66

$74,883,463.33

$78,895,157.46

Increase in 1954/55-$4,011,694.13.

101. Once again tobacco was the principal source of revenue, bringing in $35,931,744.29, an increase by $1,177,923.68 over the figure for the previous year.

102. The next most important source of revenue in 1953/54 was liquor, but in the year under review second place was taken by hydrocarbon oils which brought in $19,411,374.44, as compared with the previous year's figure of $16,742,842.71. This increase can be attributed to a number of factors including the continued expansion of the Colony's industry and population which requires increasing amounts of electric power, mostly generated from oil-fired furnaces, the growing number of road transport vehicles, and increasing resort to use of kerosene for cooking fuel, stimulated by sales promotion by companies concerned.

103. Liquor was third in line as a revenue producer. The figure of $18,461,926.36 collected from this source showed a modest increase of $126,309.23 over the figure for 1953/54.

104. Proprietary medicines and toilet preparations brought in $3,187,457.71 which was less by $172,684.73 than the figure for the previous year and indicates that this duty is being increasingly evaded.

105. The revenue from table waters amounted to $1,902,- 654.66 an increase of $211,614.22 compared with the previous year's total.

106. Fees for official certificates rose by $381,320.00 to $1,024,020.00 due mainly to increased issues of Hong Kong Government Certificates of Origin of all kinds.

107. The only other significant change in revenue during the year was the large increase in collection from business registration fees which rose from $3,582,549 in 1953/54 to $7,442,621 in the year under review. This was principally due to a large increase in business registration certificates.

X - BUSINESS REGISTRATION

108. The activities of the Business Registration Office, which is charged with the administration of the Business Regulation Ordinance, No. 14 of 1952, increased during the

year. By 31st March, 1955, the following position had been reached:

Applications registered

Demand notes issued

Original certificates issued, 1954/55

Cumulative total of original certificates issued

from 1952

Certificates renewed, 1954/55

60,537

48,638

4,500

39,328

31,596

109. On the whole, however, the work of the Business Registration Office progressed slowly, owing principally to the difficulty of covering adequately, with the staff available, all businesses affected by the Ordinance, as well as carrying out the additional inspections required by a steadily increasing number of appeals for remission of fees. No less than 3,000 such appeals, mainly by small traders and shop-keepers, were granted during the year.

110. A number of prosecutions were undertaken for the first time for failure to pay Business Registration fees and fines were imposed in a few cases.

111. The Business Regulation (Amendment) Ordinance, No. 46 of 1954, was brought into force on 19th November, 1954, to introduce a uniform type of Business Registration Certificate and to facilitate generally the work of the department in collecting fees.

Rice

XI - DEPARTMENTAL TRADE ACTIVITIES

(Figures in brackets in this chapter are comparable figures for the previous year)

112. A total of 53,322 metric tons of rice, all of edible grades, was imported on Government account between 1st April, 1954 and 31st March, 1955. During this period, in contrast with the position in previous years, Thailand was the sole source of supply. This relatively low level of Government imports

)

was largely occasioned by the presence of large stocks on hand at the beginning of the year, which stood at over 72,100 tons on the 1st April, 1954 and which dictated a policy of running down the stocks, particularly while purchasing prices remained unstable. Another determining factor was the withdrawal of the Government from direct participation in the rice trade, which became effective on the 31st December, 1954.

113. Commercial imports, which remained under restriction during the twelve months under review, amounted to 106,267 tons (including industrial grades), a figure which indicates that the estimated consumption of imported rice during the year increased to 232,500 tons, as against 226,900 tons in the previous financial year. Included in this figure is approximately 25,000 tons of rice illegally imported into the Colony between April and December, 1954. Smuggling ceased in January, 1955 owing to the fall in prices which rendered illegal imports no longer lucrative.

114. A comparatively small quantity of Government rice was sold through retail shops between 1st April and the 31st July, 1954 on which latter date rice rationing was discontinued. From July onwards, in anticipation of Government's complete withdrawal from the trade, a proportion of the stocks were sold by public tender; larger quantities were also disposed of at negotiated prices, to approved importers. The following table shows the respective quantities disposed of in these three principal ways:

Through retail shops

By tender

By negotiated sale

M/Tons

22,177.45

M/Tons

(82,599.03)

20,104.34

(

)

75,966.14

(12,750.12)

115. The net loss on storage amounted on the old stock of 72,107 tons to 2.79% and on imports during the year to .41%, the average loss being 1.80% as against .67% for the previous year. The average net loss in transit remained unchanged at .67%.

116. Two Government godowns, near Kennedy Town, which had been used for the storage of rice were relinquished on 31st August, 1954, the main rice godowns near Chatham Road and in Hung Hom, Kowloon, were similarly given up on the 28th February, 1955.

117. On 31st December, 1954 the trade was effectively returned to commercial hands, 29 importers being approved as importers-stockholders under the Importation and Exportation (Reserved Commodities) Regulations, 1954. As such, these importers alone became eligible to import edible rice, in accordance with quotas allocated in proportion to their reserve stock holdings.

Frozen Meat

118. The main frozen meat requirements of the Colony were met by Government bulk purchases from Australia, distribution for the first eight months of the period being made through the agency of the Dairy Farm Ice & Cold Storage Co., Ltd.

In December, a certain quantity of stock was stored with two additional companies, the Hong Kong Refrigerating Co. Ltd., and the Hong Kong Cold Storage and Food Industries, Ltd. who arranged distribution of the meat held in their stores. On 1st March, 1955, all Government stocks then remaining were sold to six firms who were registered as stockholders under the Importation and Exportation (Reserved Commodities) Regula- tions, 1954.

119. Imports of meats, as from 1st March until 30th Sep- tember, 1955, were restricted to these six firms, in proportion to stocks held.

120. Supplies of live cattle and pigs from mainland China built up to a good level by April, 1954, this level being main- tained satisfactorily for the remainder of the period. Ample

)

supplies of freshly slaughtered beef caused a steady reduction in Government sales through the year, average sales declining to 279 tons a month, as against 358.70 tons in the last financial

year.

Other Foodstuffs

121. Reserve stocks of certain other essential foodstuffs, the import of which was not under restriction, were held and turned over.

Coal and Coke

122. Bituminous coal and coke for local consumption were bought solely on Government account until November, save for certain specialized varieties and direct imports by utility companies. Government imports amounted to 88,430 tons, as compared with 71,750 tons in the previous financial year, as shown below:

Lump, bituminous

Dust,

Coke, foundry

85,599 tons

1,303

1,528

Sources of supply were as follows:

88,430 tons

Coal (tons)

Coke (tons)

India

70,375 (57,519)

1,528 (1,659)

Indonesia

929 ( 2,811)

( )

South Africa

1,631 ( 9,471)

(125)

Japan

China

7,202 ( 100)

6,765 (

123. An analysis of coal sales for the ten and a half months during which coal was being sold is given below:

Shipping (bunkers)

Industry

Dockyards (naval & civil)

Kowloon-Canton Railway

Services & Government

Restaurants & Hotels

Households

Miscellaneous

Shortages

20,204 tons 43,496

6,911

4,442

9,674

1,004

1,171

3,363

90,265

2,850

93,115 tons

Average monthly sales amounted to 8,868 tons, as compared with 9,655 tons for the previous year.

124. Additional supplies were imported by electricity and gas companies and by the Green Island Cement Co., who maintained their own reserve stocks and who were registered as stockholders of 16,000 tons in January, 1955.

125. In January, seven commercial importers were also registered as stockholders of 18,000 tons of bituminous coal and a further four as stockholders of 2,000 tons of anthracite. Government's coal stocks were sold to the stockholders of bituminous coal on the 1st January, 1955; thereafter the import of coal for all purposes was restricted to the registered stock- holders.

126. Some losses were disclosed on this transfer, these being the subject of a settlement effected with the operating contractors in August, 1955. The Government coal yards at Laichikok and Quarry Bay were surrendered to the Public Works Department on 1st February, 1955, with the exception of small areas for the storage of fire-wood, and were then

apportioned between registered stockholders of bituminous coal, to whom storage sites were granted on normal temporary permit terms.

Firewood

127. A drive to increase sales of wood ex Government stocks resulted in the sale of 8,378 tons, which was 4,987 tons more than in the previous year. The average sale price resulted was $4.36 per picul, as against the former price of $6.38 per picul. 1,087 tons of replacement wood were imported in the first three months of 1955.

Accounts

128. The accounting system operated satisfactorily, detailed accounts being produced monthly for administrative purposes in addition to the annual accounts prepared for audit and publication. Comparative annual turnover to the nearest million dollars is shown below:

Food

Fuel

1951/52

$161,000,000 22,000,000

1952/53

$151,000,000 14,000,000

1954/55

$125,000,000

10,000,000

129. The net surplus on the transactions of the division during the year amounted to $1,339,409.32, which was trans- ferred to the Colony's Development Fund on 31st March, 1955. This figure may be compared with the results of previous

years:

1952/53 Surplus

1953/54 Deficit

$ 3,500,000

$12,900,000

1953/54 was a year in which rice prices slumped heavily in producing countries. The general decline continued in 1954/55, though less steeply, but it proved possible to avoid a loss on the Suspense Accounts.

130. The report of the Auditors, Messrs.. Lowe, Bingham & Matthews, the Consolidated Balance Sheet, and the State- ments of Accounts of the Food and Fuel Sections are contained in Appendix XXXI (pages 70 to 88).

Welfare Officer

XII WELFARE

131. An Assistant Director was appointed departmental Welfare Officer in August, 1953, and all members of the depart- ment were informed that they could approach him directly, without formality, either in writing or by personal interview on any matter relating to welfare. This arrangement was maintained during the year under review and many interviews were granted to officers, particularly members of the Preventive Service, who wished to discuss welfare matters.

132. The general betterment of terms of service introduced under the Government Salaries Revision Scheme, which was retrospective to 1st October, 1953, had a beneficial effect upon the morale of officers in the department as a whole.

133. In addition to an alteration in the terms of service for certain Revenue Inspectors, for which approval was obtained during the year, provision was made, with effect from 1st April, 1954, for a new post of Deputy Chief Preventive Officer.

Education

134. Assistance was given to various officers in placing their children in Government schools. Encouragement was given to Messengers and Office Attendants to take English classes at the Evening Institute of the Education Department, and to clerical staff to attend classes in shorthand and/or book- keeping at the Evening Institute or the Technical College Evening Department.

MARINE DEPARTMENT LIBRARY

Leave

135. Leave rosters were carefully maintained and with very few exceptions officers were able to take a minimum of twelve days casual leave during the year.

Loans

136. Only one loan was applied for during the year and it was granted.

Working Conditions

137. Additional office space was acquired

was acquired in the Fire Brigade Building during the year, enabling conditions of work to be improved considerably. The well sunk in the courtyard of the building has provided an adequate supply of water for the flush system. Toilet facilities for women officers in the department were improved and a gas water-heater was installed in the shower-room adjacent to the Revenue Officers' quarters. The scale of issue of uniforms for members of the Preventive Service was increased.

Canteen

138. The canteen for Revenue Officers on the 6th floor of the Fire Brigade Building continued to be reasonably well patronized.

Sport and Recreation

139. The "mini-soccer" team drawn from members of the Preventive Service continued to match itself regularly against other teams in the Colony and also made two visits to Macau to play against teams there.

140. Several branches of the department organized launch picnics and other excursions at intervals during the year.

Magazine

141. The "See and Eye" magazine of the Preventive Service was produced regularly during the year, thanks to the efforts of the Chief Preventive Officer.

XIII

LEGISLATION

142. The following new ordinances and amendments and additions to existing legislation were passed during the year:

Ordinance No. 46 of 1954

G.N. No. A 51 of 1954

G.N. No. A 63 of 1954

G.N. No. A 69 of 1954

G.N. No. A 81 of 1954

G.N. No. A 100 of 1954

G.N. No. A 137 of 1954

G.N. No. A 147 of 1954

G.N. Nɔ. A 172 of 1954

G.N. No. A 5 of 1955

G.N. No. A 6 of 1955

G.N. No. A

14 of 1955

G.N. No. A 22 of 1955

Business Regulation (Amendment) Or- dinance, 1954

Dutiable Commodities (Amendment) Re- gulations, 1954

Dutiable Commodities (Amendment) (No. 2) Regulations, 1954

Prohibited Exports (Amendment) Order, 1954

Emergency (Importation and Exporta- tion Ordinance) (Amendment) Regula- tions, 1954

Rationing Rescission Order, 1954

Business Regulation (Amendment) Rules, 1954

Importation and Exportation (Reserved Commodities) Regulations, 1954

Reserved Commodities (Re-export) (Re- scission) Order, 1955

Prohibited Exports (Amendment) Order, 1955

Importation and Exportation (Reserved Commodities) (Amendment) Regulations,

1955

Import Control Licence No. 1

Order 1947 General

XIV.

STAFF

143. Mr. H. A. Angus, M.B.E., Acting Director, was promoted to Director of Commerce and Industry with effect from 8th October, 1953.

144. Mr. K. S. Kinghorn, Cadet Officer Class II, was appointed Acting Director of Commerce and Industry from 23rd March to 12th April, 1955, during the absence of Mr. Angus on sick leave.

145. Mr. Barlow, Cadet Officer Class II, was appointed an Assistant Director of Commerce and Industry with effect from 15th April, 1954. On 24th April he took over the Trade Control Division from Mr. M. D. A. Clinton, G.M. (with Bar), Cadet Officer Class II, who went on vacation leave on 28th April.

146. Mr. Clinton returned from vacation leave on 9th January, 1955, and was appointed an Assistant Director of Commerce and Industry with effect from 10th January, 1955. On 22nd January he took over the Revenue Division from Mr. G. M. Tingle, Cadet Officer Class II, who was transferred to the Colonial Secretariat on 31st January.

147. Mr. W. V. Dickinson, M.B.E., Cadet Officer Class II, was appointed an Assistant Director of Commerce and Industry with effect from 14th March, 1955.

148. Mr. W. E. Manson, Assessor Class II, Inland Revenue Department, was appointed a Trade Officer on 1st November, 1954, and Mr. T. N. Leigh-Bennet on 16th March, 1955.

149. The appointment of Mr. F. J. Wakefield, Trade Officer, ceased on termination of his agreement for service with effect from 1st June, 1955.

150. Mr. W. H. E. Colledge, Chief Preventive Officer, went on vacation leave on 24th March, 1955.

151. Mr. D. H. Knox, Senior Revenue Inspector, was promoted to Deputy Chief Preventive Officer with effect from 13th November, 1954, and was appointed to act as Chief Preventive Officer from 24th March, 1955, during the absence of Mr. Colledge.

152. Mr. L. C. Millington, Senior Revenue Inspector, acted as Deputy Chief Preventive Officer from 1st May to 13th November, 1954, and again from 24th March, 1955.

1953. Mr. R. W. Norris, Revenue Inspector was promoted to Senior Revenue Inspector with effect from 9th June, 1954. Mr. J. R. Allen, Revenue Inspector, was appointed to act as a Senior Revenue Inspector from 1st May, 1954, and Mr. G. E. Welsby, Revenue Inspector, from 5th June to 15th November, 1954. Mr. A. L. Tokley, Acting Senior Revenue Inspector, reverted to his substantive rank of Revenue Inspector and went on leave on 28th March, 1955.

154. Mr. R. Ma, Assistant Statistical Officer, resigned with effect from 5th April, 1954.

155. Mr. Tung Man Tak, Executive Officer Class II, was promoted to Assistant Statistical Officer with effect from 1st April, 1954.

156. Mr. K. Y. Tongson was appointed as an Assistant Statistical Officer on probation with effect from 3rd August, 1954.

157. The appointment of Mr. T. B. May, Assistant Trade Officer, ceased on termination of his agreement for service on 25th August, 1954.

158. Mr. C. R. M. Lawrence, Executive Officer Class I, was transferred to the Public Works Department on 1st July, 1954.

159. Mr. K. S. Mehal, Executive Officer Class II, took over the duties of Accountant from Mr. S. G. Dark, Executive Officer Class I, who went on leave on 2nd May, 1954.

160. Mr. A. G. Trickett, Executive Officer Class II, was transferred to the department and posted to the Trade Develop- ment Division on 27th May, 1954.

161. Mr. J. D. McGregor, Executive Officer Class II, was transferred to the department and posted to the Trade Develop- ment Division on 8th June, 1954.

162. Messrs. CHENG Tak Yim, A.H. Madar, Moк Hing Wing, F.W. Foster and Mrs. E. M. Giles, K.G. Potter, K.O. Topping and V.I. Lloyd were regraded as non-pensionable Executive Officers Class II with effect from 1st April, 1954.

H. A. ANGUS,

Director of Commerce and Industry.

REPORT OF THE DIRECTOR OF THE HONG KONG

GOVERNMENT OFFICE IN LONDON

General

163. The London Office, located in Grand Buildings, Trafal- gar Square, London, W.C.2., continued to maintain its services through the two principal channels of Trade Promotion and Public Relations, although it also dealt with other matters affecting the Colony. During the year its assistance was sought extensively. The following paragraphs present its major activities.

Controls

164. The Office clarified many queries, often at a few hours' notice, received both from Hong Kong and from the United Kingdom, regarding strategic materials affected by the United

Kingdom export licensing control. In January, 1955, a revision of the system of controls, by removal of United Kingdom export licensing for shipments to Hong Kong, reduced the work of the Office considerably and paved the way for more positive trade promotion.

Imperial Preference

165. Thousands of inquiries arising from claims for Pre- ference were dealt with during the year. The London Office has now a complete record of all claims to Preference made by over five hundred Hong Kong manufacturers and advises or elucidates when manufacturers and merchants are in doubt about duties, or accountants meet difficulties in connexion with claims. H. M. Customs have been dealing with a flood of claims from Hong Kong in recent years and trade has frequently been hampered by the tying up of capital in deposits of duty during examination of claims. In the year under review determined efforts were made to have delays in clearance eliminated and an improvement became evident. Following a protest because H. M. Customs were taking an average of four and a half months over each claim, the rate of clearance was tripled within two months.

166. Simplified arrangements were introduced during the year for claims to Preference on timbers, cattle hide strips and ground-nuts processed in Hong Kong.

Hong Kong. A system was also approved by H. M. Customs for the despatch of Imperial Pre- ference Certificates direct to Collectors of Customs at United Kingdom ports, so that Hong Kong exporters would not need to reveal their sources of supply to United Kingdom buyers. It says much for the good relations which exist between Hong Kong and United Kingdom merchants that only five concerns in the Colony availed themselves of this experimental system, despatching a total of fifty-seven certificates in this way.

167. Interviews at the Head Office of H. M. Customs were arranged for three visiting Hong Kong accountants. Such interviews are very valuable in clarifying the many problems

and misunderstandings which arise from the complex subject of Imperial Preference.

168. The Office assisted United Kingdom suppliers of raw materials to establish an acceptable Empire content in their products, so that Hong Kong manufacturers' claims to Pre- ference for the finished articles might be facilitated. It is often assumed erroneously that materials purchased in the United Kingdom may be regarded as having a 100% Empire content. But, for example, United Kingdom canvas used by Hong Kong footwear producers, if manufactured from American raw cotton, is allowed an Empire content of only 40%. Establishment of an acceptable Empire content at the supply stage means that all the investigations, queries and discussions can be conducted before claims arrive for examination, thus reducing the risk of still more deposits of duty.

British Industries Fair

169. Organization in London of Hong Kong's participation in the annual British Industries Fair is, together with other services described in later paragraphs, the most concrete example of positive trade promotion undertaken by the London Office. The space taken for the Colony's stand at the Fair has increased each year and in 1954 amounted to 827 square feet.

170. Detailed planning for each Fair begins almost as soon as the previous Fair has ended. This involved consideration of designs and quotations from stand designers, attendance at meetings with Board of Trade officials, when the planning of the Commonwealth Section and allocation of space therein were discussed, the clearance of exhibits from Hong Kong through H. M. Customs, the setting up of exhibits on the stand, arrange- ments for the Hong Kong delegation to the Fair, and the multifarious other details which require attention in order to ensure a successful display. At the 1954 British Industries Fair, a record number of trade inquiries, amounting to over 600, was recorded at the Hong Kong stand, and these inquiries were despatched promptly to the Colony for attention.

Commercial Relations

171. A comprehensive card index system has been built up in the Office to enable commercial introductions to be made quickly. This contains details of over 5,000 merchants and manufacturers concerned with Hong Kong trade. During the year some 2,000 trade inquiries were dealt with. Where necessary, details were sent to the Department of Commerce and Industry in Hong Kong for publication in the monthly Trade Bulletin. These inquiries covered a wide range of Hong Kong products, as well as many items offered for export to the Colony.

172. Two hundred status reports on Hong Kong companies, obtained from the Department of Commerce and Industry, were supplied to United Kingdom inquirers.

173. Claims against Hong Kong suppliers continued to be referred to the Department of Commerce and Industry for investigation, generally with the result that they were settled, without litigation, to the satisfaction of both sides. Some 20 claims were dealt with in this way, an increase over the number handled in the previous year. The increase is a reflection of the greater volume of trade between Hong Kong and the United Kingdom rather than of any reduction in the quality of Hong Kong products.

174. Overseas merchants purchasing scrap metals from Hong Kong are required to produce Import Certificates from the country of destination before Export Licences can be granted to the Hong Kong supplier. The Office, after sight of these certificates, cables confirmation to the Department of Commerce and Industry, (at the expense of the trader), not disclosing the name of the ultimate overseas buyer. During the year 80 such transactions were handled.

175. The Office continued to arrange allocations of Hong Kong basketware for import into the United Kingdom on quota and to recommend the issue of import licences to nominated importers.

Public Relations

176. During 1954 exports of Hong Kong products to the United Kingdom doubled in value. As a result, there was mounting and ill-informed criticism in the United Kingdom press against "unfair, low-price competition" by the Colony, including wild allegations that Hong Kong products were made elsewhere. The true facts about the extensive development of industry in the Colony since the war were either unknown to, or sedulously ignored by, the critics concerned. The Office countered every criticism by entering the correspondence columns of the press or by issuing press statements. In addi- tion, it made direct approaches to individuals or trade organiza- tions concerned, presenting the facts about Hong Kong's industry and offering to arrange facilities for full investigation. Most of the criticisms concerned gloves, which have had a remarkable success in the United Kingdom. By the end of the year, however, it was noticeable that the allegations that Hong Kong products were manufactured elsewhere were being abandoned as a mode of attack. The office also gave assistance to representatives of the national press in the preparation of articles about Hong Kong, and continued to maintain cordial relations with them.

177. Discussions were held with the National Hosiery Manufacturers' Federation, the National Federation of Hat Manufacturers, and the National Union of Manufacturers, at which the facts about Hong Kong and its industry were fairly presented. In addition, the Office produced a report for the Monopolies Commission on the Hong Kong footwear industry.

178. The Office is now in possession of a plentiful supply of literature about Hong Kong for distribution and this receives wide circulation to schools, various societies, businessmen and members of the general public. Two parties of Members of Parliament were provided with literature about Hong Kong as soon as their intention to visit the Colony was made public. Several hundred inquiries from individuals proposing to take up appointments in the Colony were also dealt with.

Other Matters

179. Assistance was given to the Hong Kong Chinese Manufacturers' Union in publishing advertisements concerning the 12th Annual Exhibition of Hong Kong Products in certain United Kingdom journals.

180. The Director of the Office was appointed during the year as Chairman of a Steering Committee charged with the selection and preliminary organization of a property suitable for use as a residential hostel and club in London for Hong Kong students.

181. The Director visited Hong Kong for one week in December, 1954, and the Assistant Director spent three weeks in the Colony in the following month.

182. In the year under review the office received appro- ximately 6,000 letters and wrote 4,600. Over 800 visitors were interviewed.

183. I gladly acknowledge here the willing and effective assistance given to the Office at all times by the Board of Trade, the Colonial Office and H. M. Customs and Excise.

Staff

184. The Staff of the Office consists of the Director, Assistant Director, Shorthand Typist, Junior Clerk and Office Junior.

E. G. A. GRIMWOOD, Director,

Hong Kong Government Office, London.

XVI — REPORT OF THE HONG KONG GOVERNMENT REPRESENTATIVE IN TOKYO

General

185. Representation of the Colony's commercial interests in Japan continued to be the function of the Hong Kong Section of the British Embassy in Tokyo. The main activities of the Section consisted of furthering Hong Kong's interests and presenting its views in all matters relating to trade and com- merce with the Ministry of International Trade and Industry in Tokyo, as well as general promotion of trade and the dissemination of information about the Colony.

Inquiries.

186. Numerous inquiries concerning trade, tourist facilities, and immigration requirements were received from Hong Kong merchant houses and their branches and representatives in Japan, from Japanese industrial and commercial firms and trade organizations, and from business visitors from, and firms in, other countries. The number of visitors who called in person at the office sometimes exceeded 300 a month.

Publications

187. Publications such as the monthly "Trade Bulletin” of the Department of Commerce and Industry, the Hong Kong Annual Report, etc., were distributed to inquirers in Japan and elsewhere who sought information concerning trade with the Colony. These, together with Hong Kong newspapers and magazines, etc., were also made available to visitors in the reading room maintained in this Section.

Trade Fairs, Visits and Meetings

188. The Head of the Hong Kong Section, as the Hong Kong Government Representative in Japan, accompanied a delegation from the Chinese General Chamber of Commerce in Hong Kong to the Japan International Trade Fair, at Osaka in April, 1954

and attended meetings arranged for the delegation with Cham- bers of Commerce and other commercial organizations in Japan. Arrangements were also made for official and business visitors from the Colony to visit industries and agricultural and fishery projects in Japan. The Head of the Hong Kong Section attended meetings of the Executive Committee of the British Chamber of Commerce in Japan by invitation. He was also nominated as a member of the Hong Kong Delegation which attended the E.C.A.F.E. Conference which opened in Tokyo on 15th March, 1955.

Claims

189. Assistance continued to be rendered in many cases of dispute between firms in Hong Kong and Japan, with a view to bringing about amicable settlement of claims.

Other activities

190. During the year 994 applications from Japanese businessmen to enter Hong Kong were handled. Eighteen Japanese import/export firms were permitted to establish branches in Hong Kong. The Bank of Tokyo Limited also opened a branch in the Colony and three shipping companies now have representatives there. Japan Air Lines, which began a service to Hong Kong on 4th February, 1955, and now operates three flights a week, opened a Regional Office in the Colony.

191. The Section undertook the procurement of a wide range of goods for Hong Kong Government departments.

192. Liaison was maintained with Ministries, Embassies, Legations, Chambers of Commerce and other organizations in Japan.

W. J. ANDERSON,

Hong Kong Government Representative,

Tokyo.

APPENDIX I

(See paragraphs 13-23)

Comparative Table of Total Values of Imports for the Years 1953 and 1954.

January

February

March

April....

May

Month

June

July

August

September

October

November

December....

Total

Average per month...

1953

1954

377,629,705

268,947,690

325,804,619

229,548,761

385,163,533

285,628,790

362,114,322

275,704,362

314,851,289

275,299,565

361,293,067

301,701,791

306,302,649

287,576,636

268,841,439

270,667,511

298,972,411

305,861,220

296,311,547

298,453,920

269,583,047

300,953,324

305,802,012

335,075,655

3,872,669,640

3,435,419,225

322,722,470

286,284,935

APPENDIX II

(See paragraphs 13-23)

Comparative Table of Total Values of Exports for the Years 1953 and 1954.

January

February

March

April...

May June

July

August

September

Month

October

November

December...

Total

Average per month.

1953

1954

262,456,106

200,409,686

228,121,613

176,193,045

285,035,469

205,895,260

270,562,649

185,782,215

267,243,617

201,981,961

235,544,949

193,465,359

219,902,929

197,526,340

172,348,213

200,498,707

172,765,284

215,317,610

212,213,315

208,974,185

200.882,493

216,590,730

206,644,587

214,380,503

2,733,721,224

2,417,015,601

227,810,102

201,417,967

$ MILLION

1000

APPENDIX III (see paragraphs 13—23)

900

COMPARISON OF VOLUME OF TRADE, HONG KONG, 1954 WITH 1953 AND 1952. (MOVING AVERAGE 3 MONTHS).

800

700

600

1952

500

1954

400

300

200

100

1953

NOTE: The curve is plotted on a moving average of the figures for 1954 and of the figures for the cor- responding months in 1953 and 1952. Thus the figures plotted for January are the average of the figures for December February.

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC$ MILLION

600-

APPENDIX IV

(see paragraphs 13-23)

500

VALUES OF IMPORTS AND EXPORTS, 1954 (IN MILLION H.K.$)

Total Imports =

Total Exports

Imports from China =

Exports to China =

400

300

200

100

JAN

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

Thousand

Long Tons

600

APPENDIX V

(see paragraphs 13-23)

500

VOLUME OF HONG KONG'S IMPORTS AND EXPORTS, 1954 (IN THOUSAND LONG TONS)

Total Imports =

Total Exports

Imports from China

Exports to China

400

300

200

100

JAN

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

APPENDIX VI

(See paragraph 31)

Comparative Table Showing the Percentage of Increase or Decrease of Quantity of Principal Hong Kong Products exported in 1953 and 1954.

Commodity

% increase

Unit

1953

1954

decrease

Cotton piecegoods

Sq. Yd.

133,588,227 162,595,120 + 22%

Cotton yarns

Lbs.

31,311,717

30,770,185

Cotton singlets..

Doz.

4,172,979

4,338,293 + 4%

Shirts

Doz.

1,134,458

1,490,177 + 31%

Footwear

Doz. pairs

911,402

1,163,922 + 28%

Electric torches

Doz.

2,346,088

3,032,506 + 29%

Lacquers, varnishes & paints.....

Lbs.

8,133,047

9,554,188

+ 17%

Metal Lanterns

Doz.

27,528

57,925

+ 110%

Towels, not embroidered

Doz.

1,087,853

1,020,433

Torch batteries

Doz.

5,101,075

3,968,691

22%

Vacuum flasks and jugs,

complete

Doz.

121,879

136,635 + 12%

Cement

Cwt.

403,591

743,711 + 84%

Torch bulbs

Doz.

4,987,705

7,697,305 + 54%

Iron Ore

Cwt.

2,327,846

1,652,678

29%

Matches.....

Case

6,907

16,229

+ 135%

Iron and steel bars and

rounds

Cwt.

68,337

49,566

27%

Cigarettes

Lbs.

506,752

159,472

69%

Seagrass

Cwt.

3,086

2,840

Tungsten ore (wolframite)...... Cwt.

2,972

529

82%

APPENDIX VII

(See paragraphs 29-34)

Comparative Table Showing Total Values of Exports of Hong Kong Products

(classified separately in the Trade Statistics)

for the Years 1953 and 1954.

Commodity

1953

1954

Cotton piece goods

157,546,165 181,488,369

Cotton yarns

100,158,080

96,780,395

Cotton singlets

72,218,687

66,655,667

Shirts

54,266,636

64,031,438

Footwear

52,657,487

57,636,135

Enamelled household utensils

44,194,916

61,296,161

Electric torches

35,933,549

45,222,705

Towels, not embroidered

17,026,636

8,840,994

Fruits and fruit peels, preserved, glaced or crystallized Torch batteries

15,175,397

10,722,843

13,680,353

8,591,765

Lacquers, varnishes and prepared paints

10,875,414

12,231,069

Iron ore

6,841,931

3,574,961

Vacuum flasks and jugs, complete....

6,354,456

6,325,190

Embroidered outerwear

5,782,306

6,683,671

Metal Lanterns

5,390,337

9,355,394

Plastic articles

4,846,381

7,666,349

Bed linen, table linen and toilet linen (including towels),

embroidered...

4,699,249

7,414,565

Household utensils of aluminium

3,949,226

4,581,857

Torch bulbs

3,396,748

4,329,487

Cigarettes.....

2,649,931

759,210

Cement...

2,544,871

4,562,014

Iron and steel bars and rounds

2,531,665

1,442,632

Underwear and nightwear, embroidered

2,507,743

2,718,547

Tungsten ore (wolframite)

2,383,663

166,909

Non-alcoholic beverages and waters (not including fruit

or vegetable juices)

2,373,342

1,706,074

Articles of clothing (e.g., handkerchiefs, shawls, etc.)

embroidered, n.e.s.

2,093,663

2,784,777

Fish, fish products, crustacea and molluscs in airtight

containers

1,612,639

1,306,969

Matches

1,153,293

2,613,696

Seagrass

169,239

191,104

Beer (including ale, stout, porter) and other fermented

cereal beverages

159,320

48,006

Jams, marmalades, fruit jellies and unfermented fruit

juices

114,581

150,028

Total.....

635,287,904 681,878,981

Average per month.

52,940,659 56,823,248

MARINE DEPARTMENT LIBRARY

APPENDIX VIII

(See paragraph 68)

Import Licences Issued for the year ending 31st December, 1954.

Austria

Argentine Australia

Aden

Afghanistan

Algiers

Belgium

Borneo...

362

Israel

Japan

30,008

520

Jamaica

Korea (South)

Kenya

Luxembourg

1,446

Malaya......

727

263

Mauritius..

Belgian Congo

Macau

586

Burma

Madagascar

Brazil

Mexico....

Bahrein

Morocco

British Sudan

Norway

144

British West Indies

New Zealand

Czechoslovakia

657

Portugal

316

China

442

Poland....

201

Canada

756

Philippines

162

Cuba

Pakistan

Ceylon

Persia

Chile

Paraguay

Cyprus..

Peru.....

Denmark

228

Egypt

Portuguese East Africa Rumania

Eritrea...

Spain

East Africa......

Switzerland...........

2,581

France.

592

Sweden

371

Formosa

414

South Africa

254

Finland

Syria

French-Indo-China.

374

South America

Germany (Eastern)

305

Sudan

Germany (Western)

5,808

Saudi Arabia

Greece

Thailand

1,186

Holland

1,258

Turkey.

Hungary

Tanganyika

Italy

2,359

U.S. S. R.

India

Indonesia.

Iceland

Iraq Iran

119

U. S. A.

5,270

United Kingdom

15,348

Uruguay

Venezuela

Yugoslavia

TOTAL: 73,632

APPENDIX IX

(See paragraph 69)

Export Licences received and dealt with from

1st January, 1954 to 31st December, 1954.

Month

Total

Figures of previous years Quoted for Comparison

January

12,270

12,070

February

10,683

10,456

March

15,384

14,729

April

15,177

13,948

May

15,251

14,913

June....

14,059

14,038

July....

14,563

14,106

August....

20,810

11,823

September

14,883

13,465

October

14,390

14,878

November

15,781

13,544

December

15,418

13,982

Total....

178,669

161,952

APPDENDIX X

(See paragraphs 73 —

80)

Comparative Table showing the Number of Essential Supplies Certificates Issued during the Years 1951 to 1954.

Supplying Country

Number of Certificates Issued in

1951

1952

1953

1954

Algeria

Australia

Austria

Belgium

Bahrein..

Brazil

165

274

284

215

301

195

382

546

British E. Africa

Brunei

Burma

Canada

346

191

265

351

Ceylon

Colombo

Curacao

Cyprus...

Czechoslovakia

Denmark

Dutch East Indies.

Finland....

France

238

113

233

236

French Indo China

1 ·

Germany

455

519

1,126

1,446

Hawaii Islands

Holland

169

166

Hong Kong

India....

Indonesia

Ireland

Italy

Japan

4,316

2,373

1,703

Korea, S..

Luxemburg

Macau

Mexico

New Zealand

B. N. Borneo

Norway..

18.

Philippines

Poland

Portugal

Ryuku Island.

Sarawak

NJ |

Singapore.

443

385

S. Africa

Spain.......

Sweden

Switzerland

Taiwan..

Thailand

110

།ཕྱྭg༅བ|2|||ནྡྷུམྺཱ|||༣gཌ་ྲ

142

179

183 107

1,130

128

173

601

560

|g"g| །ཉྫུ2༅།།༎༄༅རྦྷ

114

117

Timor

U. K.

U. S. A.

4,868

5,747

8,048

7,365

2,639

1,484

2,004

2,391

Total:

14,323

11,882

15,717

15,466

APPENDIX XI

(See paragraphs 81 & 82)

Comparative Table of Numbers of Manifests Received during the Years 1953 and 1954.

Ocean

River

Junk

Total

Month

1953

1954

1953

1954

1953

1954

1953

1954

January

551

657

211

198

2,455

1,701

3,217

2,556

February.

519

573

167

175

2,028

1,310

2,714

2,058

March

587

667

231

189

1,997

1,762

2,815

2,618

April

579

640

192

191

1,789

1,476

2,560

2,307

May

591

663

245

196

1,786

1,633

2,622

2,492

June

563

631

272

184

1,976

1,758

2,811

2,573

July..

590

644

226

212

2,046

1,734

2,862

2,590

August....

591

636

198

192

1,947

1,716

2,736

2,544

September

588

191

203

1,788

2,082

2,567

2,873

October

625

646

215

194

2,154

1,793

2,994

2,633

November

604

586

197

189

1,756

1,709

2,557

2,484

December

593

622

220

202

1,703

2,419

2,516

3,243

Total

6,981

7,553

2,565

2,325

23,425

21,093

32,971

30,971

Average per Month...

582

629

214

194

1,952

1,758

2,748

2,581

APPENDIX XII

(See paragraphs 81 & 82)

Comparative Table of Numbers of Declarations Received

during the Years 1953 and 1954

Month

January

February

March

1953

1954

56,954

47,260

43,832

38,545

56,194

51,368

April

51,646

48,044

May

51,559

49,654

June....

54,665

49,761

July.

55,412

49,947

August.

46,548

49,931

September

53,879

51,395

October

54,281

52,179

November

50,310

52,971

December

51,794

51,093

Total

627,074

592,148

Average per month

52,256

49,346

APPENDIX XIII

(See paragraph 86)

Details of arrests, seizures and convictions during the financial

year ending 31st March, 1955.

Estreat-

Seizures

Arrests

Convic- tions

ments of

without

bail

arrests

DANGEROUS DRUGS

opium (possession and/or importing) opium dross (possession)

opium pipes (possession)

morphine

heroin

smoking opium

2 1

APPENDIX XIII-Continued

Estreat-

Seizures

Convic-

Arrests

ments of

without

tions

bail

arrests

TOBACCO

cigarettes (possession)

tobacco (possession)

tobacco (importing).

tobacco (unlicensed selling)

failing to keep T/R stock books..

exposing for sale-cigs.

-Bowd

659

110

LIQUOR

European-type liquor (possession)

Chinese-type spirit (possession)...

stills (unlicensed)....

distilling (unlicensed)

failing to keep European liquor books

distilling repairs without permission

PROPRIETARY MEDICINES AND

TOILET PREPARATIONS

possession

263

232

•

unlicensed selling..

unlicensed manufacturing

importing

failing to keep books.........

failing to submit correct returns. exporting

UNMANIFESTED CARGO

importing

exporting

сл сл

со сл

PROHIBITED EXPORTS

(including specified articles)

importing

exporting

2235

220

18 24

GOLD

importing

exporting

IMPORT CONTROL

EXPORT CONTROL....

MERCHANDISE MARKS ORDINANCE

forged trade marks......

apply false trade description

Miscellaneous summary cases

APPENDIX XIV

(See paragraph 88)

Details of main seizures of articles subject to import and export licensing under the Importation and Exportation (Prohibition) (Specified Articles) Regulations, 1952 and other regulations.

Abaca fibre

Automatic machines....

Borax

Band saw steel.

Bench grinders

Carbon black...

Davo fibre....

Drums, empty, oil

Grinding wheels

Hemp

Iron scraps

Lead ingots

Manila rope

Pipes, iron, galvanized

Plates, iron

Plates, iron cuttings Plates, mild steel Rubber tyres..

Rubber tyre inner tubes...

Rubber tyres scrap

Rubber latex

Rubber accelerator chemicals

Steel shafts

tons

840

lbs.

tons

1,568 lbs.

280

lbs.

12 tons

44 tons

tons

1 tons

51 tons

12 tons

2 tons

11 tons 1091⁄2 tons 91 tons

901 tons 70 tons 261 tons 14 tons 4 tons

9 tons 12 tons

Steel wire

Steel wire cable

Soda ash

Steel wire coils

Steel tape

Slot machines

Sheet, iron galvanized.

Tin ingots

Tinplate

Tinplate cuttings

Vehicle parts ..........

Welding rods.....

Wire shorts, iron galvanized

Wire, iron

Watches

Watch movements and parts..

Zinc sheets.....

Note: All quantities are approximate.

800 lbs.

tons

728 lbs.

364 lbs.

3 tons

tons

2 tons

209 tons

151 tons 8 tons

11 1,330

tons

lbs.

2 1,045 lbs.

tons

14 lbs.

tons

Diesel

Gasoline

Kerosene.

Paraffin wax

Paint

APPENDIX XV

(See paragraph 88)

Details of seizures of petroleum products

APPENDIX

XVI

(See paragraph 89)

Details of seizures of dutiable commodities

Chinese prepared tobacco

Foreign cigarettes

Macau cigarettes

•

Tobacco steam

Tobacco leaf

European-type liquor

Chinese-type liquors

Alcohol

Miscellaneous toilet preparations

Chinese medicines

Foreign medicines

Illicit stills

Fermenting materials

46 tons

2 tons

37 tons

12 tons

30 gallons

38,132 lbs.

2,559 lbs.

16,872 lbs.

20,722 lbs.

1,093 lbs.

426 gallons

5,216 gallons

203 gallons

47,879 packets

2,775 packets

595

packets

579

21,460 gallons

Place of seizures

APPENDIX XVII

(See paragraph 90)

Details of seizures of dangerous drugs

Date

Type of drug

¦ Quantity

Destination indicated by circumstances

of seizure

s. s. "Tai Ping"

27. 6. 54.

Prepared opium

51⁄2 taels

Hong Kong.

Č.P.A. from Bangkok VR-HEU 15. 7. 54.

Prepared opium

214 taels

Hong Kong.

Pan American Airways

Aircraft No. 88714.

25. 7. 54.

Prepared opium

Morphine

100 taels

Manila

456 taels

Hong Kong.

Cathay Pacific Airways

Aircraft from Bangkok VR-HFF

18. 2. 55.

Raw opium Morphine

456 taels

Hong Kong.

Pan American Airways Aircraft No.5027K

1. 55.

Morphine

820 grammes Hong Kong.

3,241grammes Hong Kong.

APPENDIX XVIII

(See paragraph 99)

Revenue for the period from 1st April, 1954 to 31st March, 1955,

Source of Revenue

Gross

Net

Duties:-

Liquor

18,595,643.13

18,461,926.36

Hydrocarbon oils....

19,514,322.26

19,411,374.44

Proprietary medicines and toilet preparations

3,197,922.16

3,187,457.71

Table water......

1,903,271.61

1,902,654.66

Tobacco......

36,954,013.36

35,931,744.29

Licences, fines and forfeitures:

Liquor licences

869,080.56

867,067.16

Hydrocarbon oils....

21,883.43

21,722.23

Proprietary medicines and toilet preparations

125,046.77

124,789.35

Miscellaneous (table water) licences

6,057.98

6,042.61

Tobacco licences

Forfeitures

387,793.52

387,755.11

2,021,834.34

2,012,834.34

Fees of court or office:

Denaturing fees

137,062.89

136,913.43

Official certificates

1,024,020.00

Anti-narcotic smuggling guards

14,485.85

Bonded warehouse supervision..

23,345.00

Commerce and Industry Department expenditure..

718,669.11

Miscellaneous

1,118.73

Contribution towards H.K. Guide and Directory...

103,627.31

Gazette advertising.

32,210.00

32.210.00

Publications.

696.03

Internal revenue:

Business registration tax

Stamp duties

7,446,271.00

7,442,621.00

601,121.00

Miscellaneous receipts:

Other miscellaneous receipts.

Overpayments in previous years

75,584.57 20.53

93,766,101.14

92,489,800.82

APPENDIX XIX

(See paragraph 99)

Details of duty from European-type liquor

Type of liquor

Gallons

Duty collected $

Ale, beer, cider and stout (Non-empire origin)

891,111

1,695,892.68

(Empire origin)

219,030

355,789.62

Beer (Local origin).

1,147,083

1,147,083.54

Brandy (Non-empire origin)

44,950

2,472,265.61

(Empire origin)....

4,064

191,025.78

Whisky (Non-empire origin)

1,187

61,785.93

(Empire origin)...

54,989

2,419,853.66

Gin and cocktail (Non-empire origin)

(Empire origin)

723

25,087

37,603.37 1,149,940.45

Rum (Non-empire origin)

284

14,812.91

(Empire origin)...

1,879

82,675.48

(Local origin)

2,986

131,384.00

Liqueur (Non-empire origin)

3,209

176,517.53

(Empire origin)

670

31,490.95

Champagne and sparkling wine (Non-empire origin)..

2,965

130,445.90

(Empire origin)

2,871.04

Port (Non-empire origin)

6,814

170,350.14

(Empire origin)

9,033

180,663.86

Sherry, madeira and malaga (Non-empire origin)

6,215

155,387.16

(Empire origin)..

370

7,406.68

Vermouth (Non-empire origin).

2,689

53,797.32

(Empire origin)...

Miscellaneous (Non-empire origin)

(Empire origin)

Spirit of wine (Non-empire origin)

(Empire origin)

15,725

315,814.38

2,323

57,832.44

994

22,653.08

4,578

86,160.03

(Local origin)

Spirituous liquors

530

44,122

9,752.00

289,569.42

Totals.....

2,493,689

11,450,824.96

Note:-Fractions of a gallon are not shown.

APPENDIX XX

(See paragraph 99)

Details of duty from Chinese-type liquor

Liquor

Amount of

distilled

Imported

Amount of

locally

duty collected

liquor

duty collected

Total amount

of duty collected

gallons

Native spirits not more than 25% of

alcohol by weight

1,182,840

5,914,200.00

21,536

129,214.29

6,043,414.29

Native spirits over 25% of alcohol by

weight

87,122

669,004.40

1,622

10,728.26

679,732.66

Northern spirits over 25% of alcohol

by weight

25,901

298,048.49

Northern spirits not more than 25%

of alcohol by weight

Sake......

19,225

115,350.63

214

1,282.41

Note: Fractions of a gallon are not shown.

Total........

7,137,828.48

Duty on European liquor Duty on spirituous liquor Duty on Chinese liquor

Total:--

APPENDIX XXI

(See paragraph 99)

Details of duties from liquor

Add departmental transfer

11,042,690.43

408.134.53

7,137,828.48

18,588,653.44

6,989.69

Total:-

18,595,643.13

Subtract refund of liquor duties

133,622.19

18,462,020.94

Subtract transfers.....

94.58

Net total:-

18,461,926.36

APPENDIX XXII

(See paragraph 99)

Details of duty from tobacco

Duty from :-

lbs

Cigars

16,331

114,276.44

Cigarettes

2,878,222

16,359,305.13

European smoking tobacco

44,056

184,731.39

Chinese prepared tobacco

13,553

40,659.00

Clean tobacco leaf.....

47,551

176,013.90

Raw tobacco leaf (Empire origin)..

2,239,360

7,949,728.00

Raw tobacco leaf (Non-empire origin)

3,234,102

12,127,882.50

Snuff

177.60

Total

Add departmental transfer

Grand total

Subtract drawback

Net total

36,952,773.96

1,239.40

36,954,013.36

1,022,269.07

35,931,744.29

Duty from:

Light oils

Diesel oils for Vehicles

Diesel oils

Furnace oils

Other heavy oils

Admixtures....

Total

APPENDIX XXIII

(See paragraph 99)

Details of duty from hydrocarbon oils

Imperial

Gallons

Tons

12,504,035

8,176

10,003,228.00

850,304.00

30,345

788,970.00

268,430

6,442,320.00

13,215,861

299,383

1,321,586.10

107,845.18

19,514,253.28

68.98

Amount of duty transferred from Treasury

Grand total

Subtract drawback

Net total

APPENDIX XXIV

19,514,322.26

102,947.82

19,411,374.44

(See paragraph 99)

Details of duty from toilet preparations and proprietary medicines

Duty on toilet preparations and proprietary medicines Add departmental transfer....

Total:

――

Subtract refund

Subtract transfer

Net total:.

Duty on table waters

Subtract refund..

Total

Subtract transfer

Net total........

APPENDIX XXV

(See paragraph 99)

Details of duty from table waters

3,194,485.23

3,436.93

3.197,922.16

10,369.06

3,187,553.10

95.39

3,187,457.71

Gallons

3,963,879

1,903,271.61

7.60

1,903,264.01

609.35

1,902,654.66

APPENDIX XXVI

(See paragraph 99)

Details of licences for liquor issued for the period from 1st April, 1954 to 31st March, 1955.

General bonded warehouse licences:-

$1.

Licensed warehouse licences:-

$600.

Distillery licences:-

(a) Single still........

(b) Two stills

Brewery licence:- $600.

Canteen licences :-

$1.

Importer's licences:-

5.00

2,400.00

.S 25.

300.00.

.$200.

800.00

600.00

5.00

$150.

516

77,400.00

Dealer's licences :-

(a) for European-type liquor:—

$1,500.

218

327,000.00

(b) for Chinese-type liquor:--

1. $650.

421

273,650.00

2. $550.

138

75,900.00

3. $400.

1,600.00

4. $ 50.

119

5,950.00

5. $ 55.

110.00

.....

$ 30.

533

15,990.00

Retailer's licences:-

(a) for Chinese-type liquor:-

1. $150.

8,550.00

2. $ 25.

225.00

(b) for liquor other than intoxicating liquor:—

1. $ 50.

845

42,250.00

2. $ 30.

758

22,740.00

3. $ 20.

254

5,080.00

Permit to use alcohol free of duty in educational, scientific or

charitable institution:-

$1.

2.00

Harbour vessel licences:-

$1.00

6.00

Ship licences:-

$10.00...

Miscellaneous

100.00

8,417.56

Total......

869,080.56

APPENDIX XXVII

(See paragraph 99)

Details of licences for tobacco issued for the period from 1st April, 1954 to 31st March, 1955.

Licensed warehouse licences:

(a) $600.00

(b) $300.00

3,000.00 300.00

Manufacturer's licences:

(a) $300.00

(b) $150.00

3,000.00 300.00

Travelling salesman's licences:

$ 10.00

263

2,630.00

Importer's licences:

$150.00

135

20,250.00

Dealer's licences: --

$300.00

Retailer's licences:

(a) $ 60.00

(b) $40.00

262

78,600.00

2,486

149,160.00

2,725

109,000.00

894

17,880.00

(d) $

$ 5.00

$ 8.00

5.00

Squatter's licences:

576.00

Miscellaneous

3,092.52

Total

387,793.52

APPENDIX XXVIII

(See paragraph 99)

Details of licences for hydrocarbon oils issued for the period from

1st April, 1954 to 31st March, 1955.

Licensed warehouse licences:

$350.00

Importer's licences:

$150.00

Dealer's licences: --

$ 10.00

Retailer's licences:

$10.00

Miscellaneous

Total ...

3,500.00

13,650.00

970.00

910.00

2,853.43

21,883.43

APPENDIX XXIX

(See paragraph 99)

Details of licences for toilet preparations and proprietary medicines issued for the period from 1st April, 1954 to 31st March, 1955.

Manufacturer's licences:

$150.00

Warehouse licences:

280

42,000.00

$ 10.00

Importer's licences: -

(a) $150.00 (b) $ 20.00

283

2,830.00

12,300.00

393

7,860.00

Dealer's licences:

$ 10.00

659

6,590.00

Retailer's licences: -

(a) $ 60.00

5,940.00

(b) $ 40.00

440.00

844

25,320.00

767

15,340.00

255

2,550.00

120.00

Miscellaneous

3,756.77

Total

125,046.77

APPENDIX XXX

(See paragraph 99)

Details of licences for table waters issued for the period

from 1st April, 1954 to 31st March, 1955.

Licensed warehouse licences: -

$ 10.00

Manufacturer's licences: -

(a) $300.00

(b) $ 75.00

Importer's licences:

$100.00

Miscellaneous

Total

140.00

3,900.00

900.00

1,000.00

117.98

6,057.98

APPENDIX XXXI

(See paragraphs 112 to 130)

HONG KONG GOVERNMENT

COMMERCE AND INDUSTRY DEPARTMENT

(SUPPLIES DIVISION)

SUMMARIZED ACCOUNTS

for the year ended 31st March, 1955

and

Auditors' Report thereon

HONG KONG — AUGUST, 1955

CONTENTS

Auditors' Report

Summarized Accounts, as under:

Surplus Account

Consolidated Balance Sheet

Food Section:

Schedule

No.

General Profit and Loss Account

Trading and Profit and Loss Accounts-

Rice

IIA

Frozen Meat

IIB

Other Foodstuffs

IIC

IID

Chatham Road Godowns Operating Account.

Fuel Section:

General Profit and Loss Account

Trading and Profit and Loss Accounts-

III

• D

Coal

Firewood

IIIA

IIIB

The Director,

Hong Kong, 15th August, 1955.

Commerce & Industry Department,

Fire Brigade Building,

HONG KONG.

Sir,

COMMERCE AND INDUSTRY DEPARTMENT SUPPLIES DIVISION ACCOUNTS

We have completed our examination of the accounting records maintained by the Supplies Division of your Department for the year ended 31st March, 1955, and we now report thereon as follows:-

SCOPE OF OUR EXAMINATION

Without making a detailed audit of all transactions we have examined or tested the accounting records and other evidence in the manner and to the extent we deemed appropriate. Our examination was made in accordance with generally accepted auditing standards applicable in the circumstances and included all procedures which we considered necessary.

TRADING AND PROFIT AND LOSS ACCOUNTS

General

The Accounts of the Division for the year ended 31st March, 1955 are presented in summarized form on a basis consistent with that of the previous year.

The following points should be borne in mind when considering the results of the year's operations as reflected in the Accounts now presented: --

The Division has borne the cost of maintaining Govern- ment's reserve stocks of certain essential foodstuffs and fuel.

As these stocks have necessarily been kept at levels in excess of those justified by the normal turnover of the Division, certain recurrent expenses incurred in their maintenance are in excess of those attributable to the trading activities of the Division. While it is not practicable to show this excess as a separate item, the charges affected are—

Storage Charges and Fire Insurance on reserve stocks in

excess of normal requirements.

Storage Losses by loss in weight and deterioration attri-

butable to the increased period of turnover of stocks.

Interest charged by Treasury on funds utilized to purchase

reserve stocks.

The Division is required to pay its annual profits into the Development Fund and it has therefore been unable to utilize these profits to reduce its liability on Treasury Suspense Accounts on which interest is paid at 31% per annum. For practical purposes, the over- drawn balances of the Treasury Suspense Accounts represent the value of unsold stocks and interest charges are increased in proportion to the value of reserve stocks held.

Losses on Revaluation and Realization of Stocks

Stocks of certain commodities as at 31st March, 1955, have been valued at considerably less than cost, with effect upon the trading results of the Sections concerned.

During the year under review, the Division ceased to trade in Rice, Frozen Meat and Coal and turned over all remaining stocks of these commodities to commercial firms at prices yield- ing reduced margins of profit to Government. In addition and as commented upon later in this Report, considerable shortages in quantity were revealed when final deliveries of these three commodities were effected.

FOOD SECTION

Rice

Sales:

manner:

Sales during the year took place in the following

Ration Issues.

Contract Sales to Rice Merchants.

Sales to Rice Merchants on tenders accepted by the Division.

4. Sales of remaining stocks to approved Importers and Stockholders on a quota basis arranged with the Division.

We have been unable to obtain any guidance as to whether the disposals in 2, 3 and 4 fall within the general authority conferred by the original instructions issued by the Secretary of State for the Colonies as regards the operations of the Supplies Division. This observation also applies to disposals of Frozen Meat and of Coal.

Storage Losses:

Storage Losses revealed by the total clearance of stocks during the year were as follows:-

In stocks purchased during the year, 0.41% of the total

quantity stored.

In stocks on Hand at 1st April, 1954, 2.79% of the quantity recorded in the stock records as at that date.

Stocks on Hand at 1st April, 1954, contained several shipments which, at the time of their subsequent disposal, had been in storage for periods varying from twelve to eighteen months. Losses in certain of these shipments amounted to between 3% and 5% of quantities landed. In addition, losses

subsequently revealed in shipments partially cleared as at 1st April, 1954, have been written off after that date against the balances brought forward at that date.

The Rice Section Officials, in their written reports on storage losses, attribute such losses entirely to the length of storage and, in certain cases, to the type of rice and to its condition at the time it was received.

Miscellaneous Sales:

This credit item arises from fees charged for ration card application forms, after deduction of the expense of issuing ration cards and from the sale of dunnage wood.

Storage:

This item includes $40,983.05, representing the net depreciated value of Chatham Road Godowns as at 17th March, 1955, written off with the approval of the Financial Secretary.

Distributor's Compensation:

This compensation arose from the cancellation of the Rice Distributor's contract on the cessation of rice rationing and was paid under authority of the Financial Secretary.

Frozen Meat

Sales:

These include proceeds of sales to approved stock- holders of stocks remaining when frozen meat distribution was transferred to private enterprise. These sales were arranged on a quota basis.

Losses in Weight:

These stocks were held on behalf of Government by three cold-storage companies and when stocks were finally liquidated as of 28th February, 1955, shortages of 9,348 lbs.

from weights accepted for storage were reported. We under- stand that no representative of the Division was present when the stocks were inspected and weighed out, although acceptance of labelled weight for undamaged packages was an essential condition of sale.

Other Foodstuffs

These foodstuffs comprise reserve stocks of four com- modities, of which three are held on a replacement basis in order to ensure stocks are in good condition. There is a lack of demand for other commodity.

Sales include $39,200.50 realized from disposal of gunny bags originally purchased for the storage of one commodity.

The loss shown by the Accounts of this Section is not, in our opinion, attributable to the normal trading activities of the Supplies Division.

Chatham Road Godown Operating Account

Construction of these Godowns was financed by charg- ing rental at commercial rates on the Division's Stocks of foodstuffs stored therein and refunding the amounts thereof to Treasury to extinguish original advances for their construction. The entire cost of the godowns has therefore been borne by the Food Section of the Division.

The Godowns were handed over, without compensation, to the Public Works Department during the latter part of the year under review.

FUEL SECTION

Coal

During the year under review, the Division transferred coal trading to private enterprise and sold its remaining stocks to approved stockholders on a quota basis.

Losses during Storage:

Considerable shortages, amounting at average book cost to $236,645, were disclosed when stocks were liquidated. These losses represent the difference between weighed quantities ex-vessel for storage in individual stockpiles and weighed deliveries out of these stockpiles under the supervision of the Division's Contractors and/or Staff. We are informed that an endeavour to obtain compensation from the storage contractor is under consideration, but we are unable to express an opinion as to the amount which might be recovered.

Firewood

Storage Losses:

Considerable shortages were disclosed on clearance of individual storage lots during the year. In addition, further reductions in quantity on a sliding scale related to period in storage, and varying between 20% and 50% on certain indivi- dual lots, have been made in book quantities as at 31st March, 1955. As a result, book stocks as at that date correspond approximately with those shown in the adjusted survey report at that date issued by Messrs. Carmichael & Clarke. The approximate value of these shortages and adjustments is $712,000.

GENERAL PROFIT AND LOSS ACCOUNTS

These contain charges for Votehead Expenditure and Interest on Treasury Advances computed on the same bases as in the previous year.

SURPLUS ACCOUNT

The Deficit in trading for the year ended 31st March, 1954 was extinguished by a transfer from Government's Trading Reserve Fund during the year under review.

ASSETS

BALANCE SHEET

(Prior to extinction of Suspense Accounts)

SUNDRY DEBTORS (Dr. $35,130.11)

All items under this heading have been received since 31st March, 1955.

STOCKS ON HAND (Dr. $6,655,860.73)

We have made such tests of movements in the Stock Accounting Records as we deemed necessary and we have com- pared the balances appearing therein as at 31st March, 1955 with Stock lists supported by certificates from Public Godown Companies and from other custodians of the Division's stocks. We have also perused reports submitted to the Division by Messrs. Carmichael & Clarke, Surveyors, on the results of physical checks as at 31st March, 1955, made of firewood stored in fuel yards under the control of the Division.

Food Section:

Stocks consist of four commodities held as reserve stocks and have been valued as follows:

Commodity No. 1—At varying rates from 95% to

50% of replacement cost, depend- ing on length of storage, which varies from less than one to more than four years. Stocks more than two years old comprise approximately 26% of the total quantity as at 31st March, 1955.

Commodity No. 2-At average cost price. The stock

is frequently replaced.

Commodity No. 3-For those grades in which sales

took place during the year, stocks have been valued at 80% of average price realized. The re- mainder, of which no sales took place, have been valued at 80% of one-third of cost.

This commodity

has been

stored for more than two years and disposals from the date of acquisition amount to approxi- mately 12% of the total quantity purchased.

Commodity No. 4-At c.i.f. value.

Fuel Section:

The stock is of recent acquisition.

basis:

Firewood:-

Stocks have been valued on the undermentioned

Book quantities of certain individual lots have been written down in quantity by amounts varying from 20% to 50%, depending on period of storage. The reduced quantities have then been valued at varying prices less than cost, again depending on length of storage, and the overall total has been further reduced by 20% against possible losses in storage.

General

All stocks as at 31st March, 1955 were, with effect from that date, and subject to the approval of the Secretary of State for the Colonies, transferred to another Department of Government at the values stated in the attached Balance Sheet.

LIABILITIES

TREASURY SUSPENSE ACCOUNTS (Cr. $5,250,484.42)

General.

These balances have been confirmed by the Accountant

SUNDRY CREDITORS AND DEPOSITS RECEIVED

(Cr. $101,097.10)

So far as we have been able to ascertain from our examination and from information supplied to us, we are of the opinion that provision has been made for all known liabilities of material amount as at 31st March, 1955.

GENERAL COMMENTS

Subject to the foregoing reservations we have obtained all the information and explanations we have required and in our opinion the attached Balance Sheet properly exhibits the state of the affairs of the Supplies Division as at 31st March, 1955 prior to extinction of the Suspense Accounts, and the related Accounts properly disclose, in summarized form, the results of the transactions of the Division for the year ended that date, according to the best of our information and the explanations given to us and as shown by the books of the Division.

We have pleasure in recording that the records of the Division for the year under review have been maintained in a satisfactory manner and, in conclusion, we would take the opportunity to express our appreciation of the courtesies and facilities extended to our staff during the course of our examination.

We have the honour to be,

Sir,

Your obedient Servants,

LOWE, BINGHAM & MATTHEWS.

NET LOSS, transferred from Fuel

Section General Profit and Loss Account

SURPLUS, for the year ended

31st March, 1955

Hong Kong Government

Commerce and Industry Department (Supplies Division)

Surplus Account as at 31st March, 1955

SCHEDULE I

HK$

1,034,032.60

NET PROFIT, transferred from Food Section General Profit and Loss Account......

2,373,441.92

1,339,409.32

HK$ 2,373,441.92

Consolidated Balance Sheet as at 31st March, 1955

LIABILITIES AND SURPLUS

TREASURY SUSPENSE ACCOUNTS

Fuel

$ 1,527,543.30

Other Foodstuff...

Less: Rice.....

Overdrawn Balance

SUNDRY CREDITORS AND

DEPOSITS RECEIVED SURPLUS, per statement

7,589,827.52

$9,117,370.82 3,866,886.40

5,250,484.42

101,097.10 1,339,409.32

HK$ 6,690,990.84

SUNDRY DEBTORS

STOCKS ON HAND

As certified by Departmental

Officials:

Food Section

Fuel Section

ASSETS

35,130.11

$ 6,102,622.58 553,238.15

6,655,860.73

HK$ 6,690,990.84

NOTE:

The above consolidated Balance Sheet as at 31st March, 1955 shows the position prior to the extinction of the Suspense Accounts. Subsequent to 31st March, 1955, but with effect from that date, the Assets, Liabilities and Surplus recorded in the above Balance Sheet have been transferred to Treasury through the appropriate Treasury Suspense Accounts, thus extinguishing the liability of the Supplies Division to Treasury as at that date.

SCHEDULE II

Commerce and Industry Department (Supplies Division) — Hong Kong

Food Section

General Profit and Loss Account for the Year ended 31st March, 1955

Share of Votehead Expenditure

Interest at 34% per annum on Treasury Advances.........

Balance, being Net Profit for the

year

HK$

535,562.33

HK$

Balance, transferred from trading

and Profit and Loss Accounts:

1,097,529.32

Profit on RICE.............

$5,093,271.73

2,373,441.92

Logs on FROZEN

MEAT

7,936.41

Loss on OTHER

FOODSTUFFS.. 1,078,801.75

1,086,738.16

4,006,533.57

HK$ 4,006,533.57

Commerce and Industry Department (Supplies Division)

Stocks at 1st April, 1954

Food Section

Rice

SCHEDULE II A

—

- Hong Kong

Trading and Profit and Loss Accounts for the Year ended 31st March, 1955

HK$

65,035,157.84 Sales:

HK$

Purchases

$40,135,216.18

Less: Claims and Recoveries

265,024.02

39,870,192.16

Ration

Direct Supply

$ 5,324,300.57

108,201,371.58 113,525,672.15

Direct Expenses :

Less: Commission

Freight

$1,477,632.20

Landing and Weighing

Marine Insurance..

Agency Commission

487,017.94

179,232,58

Transportation

348,693.99

154,761.33

503,455.32 113,022,216.83

237,292.00

2,381,174.72

Proceeds of Sales of Gunnies

391,927.15

Balance, being Gross Profit carried

down

6,127,619.26

HK$113,414,143.98

Balance, Gross Profit brought down...

Incidental Expenses :

Storage

Weighing Out and Handling

Charges

Fire Insurance..

Rented Godown Expenses

Distributor's Compansation

Balance, transferred to Food Section General Profit and Loss Account

$ 840,440.93

82,624.60 5,901.38

928,966.91

20,380.62

85,000.00

5,093,271.73

HK$ 6,127,619.26

$ 6,127,619.26

MARINE DEPARTMENT LIBRAN

HK$ 6,127,619,26,

Commerce and Industry Department (Supplies Division)

Food Section

Frozen Meat

Hong Kong

Trading and Profit and Loss Account for the Year ended 31st March, 1955

SCHEDULE II B

Stocks at 1st April, 1954...

Purchases

Less: Claims....

Direct Expenses

Marine Insurance

Landing and Weighing

Balance, being Gloss Profit carried

down

Incidental Expenses :

Storage

Local Insurance

Condemned Stock written off

HK$

2,927,571.73 Sales :

8,218,008.78

1,988.40

8,216,020.38

Local Consumption

Ships' Stores

$ 10,924,769.57

883,837.44

11,808,607.01

28,606.90

22,419.21

51,026.11

613,988.79

HK$ 11,808,607.01

615,921.77

2,200.95

3,802.48

HK$

621,925.20

Balance, Gross Profit brought down

Balance, transferred to Food Section General Profit and Loss Account...

HK$ 11,808,607.01

613,988.79

7,936.41

HK$

621,925.20

Commerce and Industry Department (Supplies Division)

Food Section Other Foodstuffs

Hong Kong

Trading and Profit and Loss Account for the Year ended 31st March, 1955

SCHEDULE II C

Stocks at 1st April, 1954..

Purchases

Less Claims

Direct Expenses-

HK $

3,131,457.19

Sales..

$ 3,796,543.45

Stocks at 31st March, 1955

72,099.91

6,102,622.58

529.78

3,796,013,67

Balance, being Gross Loss carried

down

793,226.23

Freight

7,399.29

Marine Insurance

2,906.14

Landing and Weighing....

30,172.43

40,477.86

Balance, Gross Loss brought down...

Incidental Expenses-

HK$ 6,967,948.72

793,226.23

Storage

264,505.87

Weighing Out and Handling

Charges..

15,514.80

Fire Insurance..........

5,554.85

285,575.52

HK$ 1,078,801.75

HK$ 6,967,948.72

Balance, transferred to Food Sec- tion General Profit and Loss

Account

$ 1,078,801.75

HK$ 1,078,801.75

SCHEDULE II D

Commerce and Industry Department (Supplies Division) - Hong Kong

Food Section

Chatham Road Godown Operating Account for the Year ended 31st March, 1955

Management, Operation and

Maintenance Expenses

Balance, being Operating Profit

carried to Reserve for Depreciation of Godowns.

HK$

130,124.22

Storage Charges on Government

Stocks

Storage Charges collected from

Stockholders.......

35,781.60

Sales of Split Firewood (Dunnage)

etc.

HK$

165,905.82

Commerce and Industry Department (Supplies Division) - Hong Kong

Fuel Section

General Profit and Loss Account for the Year ended 31st March, 1955

HK$

138,450.80

16,574.60

10,880.42

HK$

165,905.82

SCHEDULE III

HK$

Balance, being Net Loss for the year

1,034,032.60

Balance, transferred from Trading and Profit and Loss Account :

Loss on FIREWOOD

Profit on COAL

$1,278,108.57

522,875.24

Share of Votehead Expenditure

755,233.33

166,423.20

Interest at 31% per annum on

Treasury Advances..

112,376.07

HK$ 1,034,032.60

HK$

1,034,032.60

SCHEDULE III A

Commerce and Industry Department (Supplies Division) — Hong Kong

Fuel Section

Coal

Trading and Profit and Loss Account for the Year ended 31st March, 1955

HK$

402,209.08

HK$

Sales

9,185,051.26

$ 7,446,618.45

Less: Commission on Coal Sales...

1,524.20

9,183,527.06

118,156,14

7,328,462.31

53,058.00

524,213.56

Stocks at 1st April, 1954....

Purchases..

Less: Despatch Money

Sworn Measurers' Fees

Stevedorage and Delivery Charges...

Storage and Incidental Expenses :

Rents and Rates.......

312,955.95

Electricity and Water Charges

Repairs and Maintenance..

10,005.90

7,548.13

330,509.98

22,198.89

Fire Insurance..

Balance, transferred to Fuel Section General Profit and Loss Account...

522,875.24

HK$ 9,183,527.06

HK$

9,183,527.06

SCHEDULE III B

—

Hong Kong

Commerce and Industry Department (Supplies Division)

Fuel Section Firewood

Trading and Profit and Loss Account for the Year ended 31st March, 1955

Stocks at 1st April, 1954

Purchases

Survey Fees

Sworn Measurers' Fees...........

Stevedorage and Delivery Charges

Repairs and Maintenance

Fire Insurance

HK $

2,147,786.88 Sales.....

570,717.12 Less Commission on Firewood

Sales.......

1,429.75

5,021.40

Stocks at 31st March, 1955

66,874.83

Balance, transferred to Fuel Sec-

68.16

tion General Profit and Loss

Account

1,715.24

HK$ 2,793,613.38

HK $

962,316.66

50.00

962,266.66

553,238.15

1,278,108.57

HK$ 2,793,613.38

GNDY

HUNG