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It is considered that a sum of about 15 lakhs of dollars of subsidiary coins would be ample for the requirements of the Colony's business for a period of years, and that an issue of under $100,000 per annum would be quite sufficient to provide for deficiencies in the amount arising from loss, wear and tear, &c., and for any probable increase in the population, after the currency has been put on a proper footing.
4. It is therefore highly probable that, allowing for a great diminution in the total amount already issued (on account of loss, wear and tear, conversion into ornaments, &c.), the amount which might be expected to be finally returned on our hands would come to the neighbourhood of twenty millions, an excess over requirements of over eighteen millions.
No rehabilitation of currency in such circumstances can possibly take place without expenditure on the part of the Government and I therefore submit for Your Lordship's consideration the following suggestion.
5. At present this Government is receiving in the collection of revenue the sum of about $30,000 monthly in the form of subsidiary coin. This coin is paid into the Bank on Government Account at its face value and at the end of the month Government pays to the Bank the difference between such value and the value at the rate of the day.
This entails a regular expenditure of something under $3,000 every month, and the subsidiary coin so dealt with still remains available for circulation.
I propose therefore that in future all such money collected be placed to credit of the Treasury subsidiary coin stock account, and that when a sufficient amount is so stored it should be sent home to be disposed of by the Crown Agents. This will entail an expenditure on account of loss to the amount of about $40,000 per annum which is however set off by the saving of the present monthly payments to the Bank.
Pending Your Lordship's decision in this matter I have given instructions that the amounts paid in from the current month onwards be treated in the manner suggested.
6. I may add that a proposal for dealing with receipts of subsidiary coin in the manner indicated was submitted to Sir M. Nathan before his departure and that he was in favour of adopting the proposal.
The Right Honourable
THE EARL OF ELGIN, K.G.,
I have, &c.,
F. H. MAY.
de.,
fc..
gc.
TELEGRAM FROM THE OFFICER ADMINISTERING THE GOVERNMENT OF HONGKONG TO THE SECRETARY OF STATE.
27th June, 1907.
Referring to my Confidential Despatch of 27th April is proposal approved ?
TELEGRAM FROM THE SECRETARY OF STATE TO THE OFFICER ADMINISTERING THE GOVERNMENT OF HONGKONG.
Your telegram of 27th June. Proposals approved.
MAY.
29th June, 1907.
ELGIN,
NOTE. The above indicates the action the Hongkong Government is taking to rehabilitate its subsidiary coinage. It may be possible from time to time to find means to accelerate the withdrawal of its subsidiary coins. In addition the Hongkong Government has succeeded in convincing the Authorities at Canton that suspen- sion of the coinage of their subsidiary coins is necessary, and has induced them to suspend it temporarily. Endeavours are being made to make such temporary suspension permanent for a period of years. At the same time no effort is being spared to urge in the proper quarter the institution of a national coinage in China.