This Document is the Property of His Britannic Majesty's Government.]
CHINA TRADE.
CONFIDENTIAL.
No. 1.
[May 24.]
94
SECTION 1.
Sir,
China Association to Foreign Office.-(Received May 24.)
159, Cannon Street, London, May 23, 1905.
BY Article II of the Mackay Treaty, signed two years-and-a-half ago, China agreed to take steps to provide for a uniform national coinage, which should be legal Since that time tender in payment of all duties and taxes throughout the Empire. several experts have suggested to the Chinese Government various schemes for the establishment of a new monetary system, but as all these aimed at finally substituting a gold for a silver basis, the Chinese Government may be excused for taking its time before committing itself to such an important change. But China has not been satisfied to postpone taking action until she had time to weigh carefully all the consequences of the proposed schemes; she has, on the contrary, steadily persisted in adding confusion to her existing monetary system by allowing the different provinces to establish mints, and to issue silver dollars of varying weights and degrees of fineness, so that now China has some half-dozen kinds of dollars, all of dissimilar value, and these have such limited currency that, as a rule, they are only accepted in the province of their origin.
If the Chinese Government had represented that it was inexpedient to mint any silver coins until it had decided whether it would adopt the gold standard or continue on a silver basis, it might have been unreasonable for foreign Governments to press for reform, but seeing that with the approval of the Central Government silver dollars of different values are now being coined in considerable numbers in various parts of the Empire, it seems only right that the Government should be reminded of its undertaking to establish a uniform coinage, and requested, if it is not prepared to establish one central mint, that it will at least insist on the several provincial mints coining dollars of identical value, so that they may all bear the same ratio to the Haikwan tael in which duties are now paid. This ratio should be officially communicated to the various Treaty Powers, and instructions should be issued to all The guarantee that custom houses to accept these dollars at the ratio proclaimed.
all these provincial dollars would have one and the same value at all custom houses would insure their free circulation, and the fact that in the end they would find their way to the Imperial Treasury would cause the Central Government to exercise adequate supervision over the provincial mints.
This is not a final solution of China's monetary problem, but it is a step towards attaining the uniformity aimed at in the Mackay Treaty, and should be insisted upon, The most recent instance of the manner in which China is ignoring the engage- ments made in the Mackay Treaty is the issue by Viceroy Chang Chih Tung at Wuchang of a Hupeh Treasury tael, particulars of which are given in Consul-General Fraser's despatch of the 23rd January, 1905, courteously sent to us by you, and the proclamation issued by this Provincial Governor announcing that this coin is to be accepted at a fixed value throughout the Empire, apparently without any sanction from the Peking Authorities for so doing. In the opinion of Consul-General Fraser the coin is unsuitable for the purpose named, and the Committee consider the issue of such a coin as a retrograde movement, and one calculated to add to the present confusion.
I have, &c. (Signed)
JOSEPH WELCH,
Hon. Secretary
[1977 aa-1