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Rh of other nationalities quietly submitted to this change in the system, trade continued to proceed as before. Thereupon the Chinese imposed (A.D. 1805) a further special tax, like the modern Li-kin, to provide for the necessities of coast defence and other warlike preparations against the foreign ships. This measure was taken by the Chinese because they had observed that the foreign ships had, owing to the steady increase of the value of their cargoes, gradually increased their armaments.

Trade, however, continued increasing from year to year. But soon a hand's breadth of a cloud, destined to develop into a tempest, arose on the commercial horizon in the shape of the 'exportation of bullion' question and the altered attitude of foreigners generally. With the gradual increase of the opium trade, the Chinese observed with dismay that the balance of trade, though still in favour of China, was steadily diminishing from year to year as foreign commerce expanded. In the year 1818 a rule was therefore made to restrict the exportation of silver by any vessel to three-tenths of the excess of imports over exports by that vessel. The tea trade, indeed, increased very rapidly, to the great satisfaction of the Chinese officials, especially since teas began (A.D. 1824) to be shipped direct from China to the Australian Colonies. But however fast the export of tea increased, the imports of opium out-stripped it in the race. Accordingly in the year 1831 the Chinese Authorities, in their dread of the increasing outflow of silver from China, imposed upon foreign merchants such severe additional restrictions, that the Select Committee of the East India Company's Supercargoes, headed by Mr. H. H. Lindsay, threatened to suspend all commercial intercourse. Eventually, however, when matters came to a crisis (May 27, 1831), the Select Committee yielded and in token of their submission, handed the keys of the British Factory to the Brigadier in charge of the Provincial Constabulary (Kwong-hip).

Though victorious for the moment, the Chinese officials could not help noticing on this occasion more than ever before, that a considerable change had come over the demeanour of