Thus the Statesman's Year Book. This authority, however, omits to mention just exactly how this important piece of Chinese territory came to be ceded to Great Britain. It was the reward that Great Britain took unto herself as an "indemnity" following the successful prosecution of what is sometimes spoken of as the first opium war—a war of protest on the part of China against Great Britain's insistence on her right to deluge China with opium. China's resistance was in vain—her efforts to stem the tide of opium were fruitless—the might, majesty, dominion and power of the British Empire triumphed, and China was beaten. The island on which Hongkong is situated was at that time a blank piece of land; but strategically well placed—ninety miles south of the great Chinese city of Canton, the market for British opium.
The opposite peninsula of Kowloon, on the mainland, was ceded to Great Britain by treaty in 1861, and now forms part of Hongkong. By a convention signed at Peking in June, 1898, there was also leased to Great Britain for 99 years a portion of Chinese territory mainly agricultural, together with the waters of Mirs Bay and Deep Bay, and the island of Lan-tao. Its area is 356 square miles, with about 91,000 inhabitants, exclusively Chinese. Area of Old Kowloon is 3 square miles. Total area of colony, 391 square miles.
The population of Hongkong, excluding the Military and Naval establishments, and that portion of the new territory outside New Kowloon, was according to the 1911 census, 366,145 inhabitants. Of this number the Chinese numbered 354,187.
This colony is, of course, governed by Great Britain, and is not subject to Chinese control. Here is situated a Government opium factory, and the imports of Indian opium into Hongkong for the past several years are as follows:
| 1903- 4 | 3,576,431 | pounds sterling |
| 1904- 5 | 4,036,436 | |
| 1905- 6 | 3,775,826 | |
| 1906- 7 | 3,771,409 | |
| 1907- 8 | 3,145,403 | |
| 1908- 9 | 2,230,755 | |
| 1909-10 | 3,377,222 | |
| 1910-11 | 3,963,264 | |
| 1911-12 | 3,019,858 | |
| 1912-13 | 2,406,084 | |
| 1913-14 | 1,084,093 | |
| 1914-15 | 110,712 |
These figures are taken from "Statistical Abstract Relating to British India, 1905-6 to 1911-15," and "Statistical Abstract Relating to British India, 1903-4 to 1912-13." The falling off in imports of opium noticed in 1914-15 may be due to the war, lack of shipping, etc., or to the fact that the China market was due to close on April 1, 1917. The closing of the China market—400,000,000 of people destined no longer to have opium supplied to them (except illegally, by smuggling, etc.) is naturally a big blow to the British opium interests. That is where the menace to the rest of the world comes in. Opium has been proved such a profitable commodity, that if one market is shut off, others must be found as substitutes. The idea of closing the trade altogether naturally does not appeal to those who profit by it. Therefore, what we should hail at first sight as a welcome indication of a changed moral sentiment, is in reality but the pause which proceeds the casting about for new markets, for finding new peoples to drug.
The Colonial Report No. 972, Hongkong Report for 1917, gives the imports and exports of opium: Page 7—
"The imports and exports of certified opium during the year as follows:
| Imports | 7 | chests |
| Export | 224 | chests |
Of these, however, the imports all come from Shanghai, and of the total export of 224 chests, 186 went to Shanghai."