Ending Sabah opium consumption
Published on: Saturday, June 12, 2021
By: British North Borneo Herald
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16th Sept 1938

REPORT of the One-hundred-and-first General Meeting of Shareholders of the British North Borneo (Chartered) Company held at River Plate House, Finsbury Circus, London, E.C.2, on Tuesday, 2Ist June, 1938. 

Major-General Sir Neill Malcolm, K.C.B., D.S.O., in the chair. 

Meanwhile we begin to draw rent from the Oil Company from the 1st July of this year, a rent which will rise gradually and will be payable until the Company either finds oil or decides to abandon its concession. So much for the Commercial prospects of the Company, which I venture to think are not discouraging in spite of present-day depressions. 

There is, however, one more subject of this nature, which I foreshadowed in the earlier part of my address to you, on which I ought perhaps to say a further word, and that is opium. As you know, it has for the last 10 days been the declared policy of the Chartered Company to suppress the consumption of opium in North Borneo. With this object the price of chandu has been gradually raised and smokers have been both registered and rationed. 

As the result, our revenue from what I venture to call this pernicious trade has gone down from f105,000 in 1927 to £45,000 in 1937, and it now only provides 10 per cent of our total revenue against over 20 per cent in the former year. A further step is now about to be taken. 

From the 31st December, 1939, no new names will be added to the registers, and rationing will be very strictly controlled. That means that the registers will be closed at the end of next year. 

What the next step will be exactly I cannot as yet say, but I hope, and believe, that by 1950 little or no opium will be smoked in North Borneo. I am quite sure, if we achieve that, it will be to the benefit of the Shareholders of this Company. 

I will now turn to a few matters of a non-commercial character. You will remember that I spoke last year about Dr Shircore’s investigation into the causes of the distressing disproportion between deaths and births in certain of our tribes which appear to be gradually dying out. 

As the result of his very valuable report, which has been read with great interest in the School of Tropical Hygiene, we appealed to the Trustees of the Colonial Development Fund for grants to enable us to establish a malarial research unit and a central clinic for maternity and child welfare. 

Both these appeals have been granted, and we are now engaged upon the preliminary work which we hope will be very helpful to the present and to future generations. For this, and for much else, we are indebted, in the first place, to the initiative of our late Governor, Sir Douglas Jardine. 

Lastly, a word about our Civil Service, the guardians of your interests in the East. Of recent years promotion in our Service has been very rapid, with the result that, including our Governor, we have now only three Administrative and five non-Administrative Officers in the country with over 20 years’ service. 

The three Administrative Officers are His Excellency, Mr Smith, the Chief Justice, Mr Macaskie, who is also Deputy Governor, and the Protector of Labour, Mr Skinner. With these notable exceptions the Administrative Service is now very young, so young that you may find cadets in their first tour of service occupying highly responsible positions. 

That is a state of affairs which might have shocked some of our old Administrators, and possibly some of those who are in this room to-day, but I assure you that you need have no anxiety on account of their youth, for they are excellent Civil Servants and make up by their enthusiasm for their lack of experience. 

But it is also true that through that same lack of experience more responsibility is thrown upon the few senior Officers we still have. 

Time will rectify this weakness, if it is a weakness, and meanwhile these young men are guarding your interests most successfully. Indeed, a friend of mine in Malaya, who recently paid a visit to North Borneo, said to me: 

“I have never met a body of men so happy and so completely wrapped up in their works as your Civil Service,” and as an example of what he meant he instanced a gazelle hunt on ponies led by the Acting Resident, who is known to many people in this room, the Commandant of the Police, the District Officer and himself; the main body of the field was composed of sons of the local Chiefs and a few others, while the tail of the hunt was brought up by little Bajau boys riding two at a time on their water buffaloes. 

While that sort of thing continues, you need have no fear of Officers not knowing their districts, or of the population not having complete confidence in their leaders. 

While on this subject, I should like to pay a particular tribute to our Medical Service, which has had a very difficult on owing to the great increase of Chinese immigration from Hong Kong, where there has been a violent epidemic of small pox. 

This has necessitated the greatest vigilance of the part our Medical Officers, especially in the quarantine station on Berhala Island. 

Thousands of our Chinese and natives have come forward for inoculation, and so far, I am thankful to say, no case has been reported on the mainland. I regard this as a very fine performance, I am sure you will agree that much of the enthusiasm in the Service of which I have spoken is due to our Governor, Mr Smith, himself. 

He has an unrivalled knowledge of the country, and practically all the leading men of the country, the Chinese, Malays’ Japanese and others, are his personal friends. 

He has known them for many years, and they have every confidence in him, and they go to him intimately in a way which it would not be possible for them to do if he had not had great experience in the country. All his knowledge and experience he places unreservedly at your service. 

I now formally move that the Report of the Directors and Statement of Accounts appended thereto for the year ended 31st December. 1937, be received and adopted –  and I will ask Sir Andrew McFadyean to second that Resolution. 

Sir Andrew McFadyean: I have much pleasure in seconding the Resolution which has just been proposed by the President. 

The Chairman: Before I put the Resolution to the Meeting has any Shareholder any question to ask? A Shareholder (Mr Sparrow): You have told us, Sir, a certain amount about rubber. Could you tell us what your views are in regard to the question of rubber restriction, and what is the effect of the quotas on the various Companies which work out there? That is the only question I have to ask. I should, however, like to say this, because you touched rather lightly on this matter. 

I think all the Shareholders present to-day will agree that our thanks are due to you. the Court, and all those in our employ for what can be described as the best Balance Sheet issued by the Company – it is certainly the best issued by the Company in my time, and I have been a Shareholder in the Company for 35 years. 

I remember once you paid a dividend of 5 per cent, and to-day the surplus shows you could almost pay a dividend of 6 per cent. That 5 per cent dividend was paid out of what one might described as high finance. 

This is the very best Balance Sheet which has ever been presented to us. (“Hear, hear”). You mentioned, Sir, you had increased the dividend by 100 per cent. Just try and make it another 50 per cent next year and you will create another record! 

There is one other point I want to mention, namely, the honour conferred upon our Vice-President, Sir Dougal Malcolm, whose name appeared in the last Birthday List of Honours of His Majesty, the King. 

Sir Dougal has done many great works for this Company, and I think most, if not all, of the Shareholders present to-day would wish you to convey to Sir Dougal our heartiest congratulations on what can only be described as a well-merited honour. 

The Chairman: Has any other Shareholders any question to ask? – Apparently not. 

I need hardly say, Ladies and Gentlemen, it will give the greatest pleasure to me and to the Court, to convey Mr Sparrow’s message, endorsed by the body of the Shareholders, to our Vice President, Sir Dougal Malcolm, and I have no doubt whatever the receipt of that message will give him the greatest pleasure and encouragement. We all know, I think, that in the old days a great deal was due to the way in which he handled an extremely difficult situation. 

The honour which has been conferred upon Sir Dougal now has been thoroughly deserved – not only for his work in this country, but also in many other spheres of activity. I thank you very much indeed for your kind remarks, Mr Sparrow, in regard to Sir Dougal Malcolm. 

I thank you, too, for the kind remarks you have made about the Balance Sheet. Perhaps another 50 per cent is too much to hope for in these bad times, but anyway, we shall do our best. 

Now with regard to what you asked about rubber restriction. I purposely did not say anything about this matter in my speech, but as you have asked me about it, there are several things which perhaps might be said on this question. Personally, I think the rubber restriction has been of the greatest benefit to our territory. 

Our new quota for 1939 goes up from 16,500 tons this year to 21,000 tons, which will be our quota for the next five years. That is a considerable addition – but everything depends, of course, on what the release is. 

You may have a very good quota, but if you are only able to use 45 per cent, it strikes everybody hardly for a time, although in the end I have no doubt that by keeping up the price it operates to our advantage. 

On the other hand, I think it is hardly possible to regard with unmitigated satisfaction a system which has the result of making our assessment per acre lower than that of any other country producing rubber. 

I think there is no question now – there are experienced planters in this room who know about it – that the North Borneo estates are at least as good as those of any other country, and it is hard that in five years time we shall still be allowed to produce less per acre than any other rubber producing country. 

I hope the Rubber Restriction Committee will see their way to remedy that, because that is very hard, especially on our smallholders. With that exception, I think the country is benefiting from the work of the Rubber Restriction Committee – work which is by no means easy. 

If there are no other questions any Shareholder would like to put, I will now put the Resolution in reference to the adoption of the Report and Accounts to the Meeting. (The Resolution was put to the Meeting and earned unanimously.) 


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