No 195.

100

CAFT

REC

18527

REA SI VER

GOVERNMENT HOUSE.

HONGKONG. 2nd, July, 1918.

Treas

Sir,

With reference to your Confidential

37789 Despatch of the 8th. August, 1917, I have the honour to

Gar 340-96

-do-

transmit for your consideration the enclosed copy of a letter

from the Chief Manager of Hongkong and Shanghai Banking Cor-

poration asking that the authorised issue of the one dollar

notes of the bank be increased further up to a limit of

$1,000,000 or $1,200.000.

2.

There is no doubt that since my despatch

of the 21st. May, 1917, was written, these notes have become

more and more popular in the neighbouring provinces of China

with the result mentioned in Mr. Stabb's letter. There is

also no doubt that the use of the notes in China is a great

convenience to trade from Hongkong.

3.

So long as the conditions mentioned in

paragraph 4 of my despatch of the 21st. May, 1917, are

continued there does not appear to me to be any objection to

increasing the limit to the issue of these notes and I have

therefore to recommend strongly the approval of the proposals

of the bank, which will undoubtedly be of benefit to this

Colony.

THE RIGHT HONOURABLE

WALTER LONG, M.P.,

&C...

&0..

&C..

4.

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