493.46G9/10–1651
The First Secretary of Embassy in the United Kingdom (Ringwalt) to the Department of State
No. 1780
Subject: Hong Kong in Relation to the Embargo on Strategic Exports for China.
There are enclosed copies of an undated memorandum prepared in the Colonial Office on the subject: “Hong Kong in Relation to the Embargo on Strategic Exports for China”.1 It presents in a reasonably clear and concise form a picture, as seen by the British authorities, of the steps taken by the Government of Hong Kong to control exports to China, notwithstanding the financial sacrifice which the enforcement of the controls has meant to large sections of the population of the Colony. The memorandum emphasizes the effect upon the economy of Hong Kong of the curtailing of supplies for Hong Kong’s own industries which has led to inflation and unemployment. It describes the hardships borne by these industries, including many so-called “cottage” industries as a result of the application to Hong Kong of Sec. 500.808 (as amended) of the Financial Assets Control Regulations of the Treasury Department which prohibits the import into the United States of goods processed in Hong Kong from Chinese raw materials.
The memorandum pleads that application of these controls is such as to cause serious economic loss and risk to the internal security of Hong Kong and that therefore the policy of countries cooperating in the strategic embargo against China should be modified constructively to the end that the normal exports and imports of the Colony may be maintained except insofar as they can be shown to be of assistance to forces of aggression.
[Page 2027]It is possible that the memorandum can be of assistance in the discussions of the Hong Kong problem with other interested government departments in Washington.
- Not printed.↩