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 from the mountains, the largest towards the east coast. The coast is indented, with many offshore islands, and we saw busy deep water harbours at Jesselton, Sandakan, Tawau, Kudat and Labuan. Wide stretches of grassland are found in the interior plains. Over 40 per cent. of the population is concentrated in the west coast agricultural belt where the land is clearer and more fertile and communications are easier. The interior plains are less populous, whilst the east coast, comprising over half the country, has large areas of uninhabited rainforest behind a few coastal centres of population and economic activity such as Sandakan and Tawau. As in Sarawak, the basis of the economy is agriculture, forestry and fisheries; the principal exports being timber, rubber and copra.

96. The country's finances have improved rapidly during the last few years. This has made it possible to embark on a development plan which includes a number of major new roads. These will open up new areas where the soil is known to be excellent for such crops as wet rice, oil palms, cocoa, abaca and rubber. The atmosphere in North Borneo is an exhilarating one. Production of the main export crops of timber, rubber and copra has been expanding rapidly and there is full employment. Indeed, the industries on the east coast in the Tawau and Sandakan Residencies attract immigrant labourers in large numbers from Indonesia and to a lesser extent from the Philippines. The chief towns have been rebuilt on imaginative lines since the destruction at the end of the war with Japan, and the country as a whole is looking forward to a bright and prosperous future.

97. North Borneo was governed by the British North Borneo (Chartered) Company from 1881 until 1942 when it fell to the Japanese. In 1946, the territory became, with EabuanLabuan [sic], the new Crown Colony of North Borneo. The Government is administered by a Governor and Commander-in-Chief appointed by the Crown. The Constitutional Instruments provide for Executive and Legislative Councils, both presided over by the Governor. Recently an unofficial majority was introduced into the Legislative Council, which now consists of the Governor as President, 4 ex officio Members, 3 official Members and 18 nominated (unofficial) Members. Unofficial Members are at present appointed by the Governor after considering recommendations by Local Authorities and other bodies. The Executive Council consists of the Governor as President, 4 ex ofifcio Members, 2 official Members, and 6 unofficial Members.

98. As in the case of Sarawak, the Government of North Borneo had arranged before our arrival for the Commission to make an extensive tour covering most of the Districts in all four Residencies in the Colony. The itinerary is contained in Appendix A. We held hearings altogether in 15 different places over a total period of just under four weeks. On one occasion (on Friday, 13th April) the weather prevented us from landing at Ranau where we were due to hold hearings, but the people concerned were brought to Jesselton to see us two days later. This was the only engagement during the whole of our tour of Borneo that we failed to keep. Where it was impossible for us to travel ourselves to some of the remote districts, arrangements were made for representatives from those districts to come into one of the centres which was on our programme.

99. We were given every facility by the North Borneo Government to make what inevitably was a strenuous exercise as little tiring as possible. We travelled