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552 new territory, though thinly peopled, was capable of great development, that labour could be readily supplied from China and that the situation of North Borneo, midway between Hongkong and Singapore, was even of political and strategical importance.

The old problem of the Customs blockade, the only point regarding which Sir John might have usefully redeemed his promise to protect local commercial interests, was not brought a single step nearer solution during his administration. In 1877, Sir A. Kennedy, before leaving the Colony, forwarded to the Secretary of State his recommendations with reference to that clause of the Chefoo Convention which referred to the Mixed Commission that was to settle the blockade question, and the Legislative Council recorded (February 20, 1877) its sense of obligation to the efforts of Sir Arthur to remove the impediments to commercial intercourse between Hongkong and China. But for more than two years nothing further was done in the matter, except by the blockade officers who became more audacious than ever in their interference with the trade of the Colony, and by mild remonstrances forwarded by Sir J. Pope Hennessy to the British Consul in Canton whenever Chinese petitioners presented a specially strong grievance. For the blockade officers now attempted to levy their exactions on non-dutiable articles of daily consumption, and although this was resisted and eventually, owing to the representations made by the Consul to the Viceroy of Canton, abandoned, the blockade officers succeeded in confining the exemption from duties to positively fresh provisions, and then went further and excluded even cattle from the catalogue of non-dutiable articles. When Sir Thomas Wade passed through Hongkong (April 7, 1879), on his way to England, the Committee of the Chamber of Commerce told him that they considered the Convention as a retrograde measure, needing careful revision, and that, although five new ports (Wuhu, Wenchow, Ichang, Pakhoi and Hoihow) had been opened under its provisions, it was their earnest hope that Lord Salisbury would refuse to ratify it. Great was the surprise of the