Opium trade continues to be the major trading item in the early Hong Kong colonial history, especially after the “Treaty of Nanjing” ( 南京條約 ) in 1942 that granted British trading rights and privileges in five Chinese ports.
Almost every British trading companies (12 largest) in Hong Kong involve opium trade.
In 1847, 86.5% of Hong Kong total export was opium.
The large opium vessel entered Hong Kong harbor and reloaded on to smaller vessel, and shipped to Shanghai.
There were 40 opium pontoons ( 驳船 ) along the China coastal region. Most of them belong to the British companies
Colonial government encouraged Chinese capitalist to invest in Hong Kong because they were good business collaborators who have good connection with China and oversea Chinese networks, and have good knowledge of the markets.
At the end of 19 th century, many Chinese capitalist gradually became the competitors of the Western Capitalist.
The naturalization of the Chinese capitalist class
The 8 th governor John Hennessy understood that they could not isolated 95% of the Chinese population, especially the Chinese capitalist class.
The Chinese was crucial to British business interest.
90% of colonial government revenue came from the Chinese.
Against segregation, Hennessy allowed Chinese elites to live in the European area ( 皇後大道 ), become Legco member, enter the town hall freely
“ Chinese Naturalization Ordinance” was passed to provide British citizenship to the Chinese elites.
Colonial government continued its free-trade port policy.
Greater special rights are given to British companies, while absorbing Chinese business elites.
HSBC, 怡和 , 太古 conglomerates that represented British interest have become very dominant
Economy has diversified from coolie and opium sales to more trade, finance and manufacturing. At the same time, construction, public infrastructures, local business and services began to take off as population increase rapidly.
After British took back Hong Kong in 1945, the governor continue “free trade” economic policy in Hong Kong.
However, the unregulated banking sectors were engaged in fierce competition, which led to Banking crisis in the 1960s. Government begin to regulate import/export of gold (1947); prohibited foreign bank to set up branch in Hong Kong (1966) ..etc.
Positive non-interventionism only intervene in economy at the time of major economic difficulties or crisis.
U.S. Buyers place their orders with Hong Kong trading companies or manufacturing companies, who in turn shift some or all of the requested production to offshore factories in low-wage countries (e.g. China).
These offshore factories (in China) are wholly owned subsidiaries of Hong Kong manufacturers, joint-venture partners or independent overseas contractors.
The finished goods are shipped directly to buyers in the U.S..