2
9
May it was $4,757,471. The factors involved are as follows:-
Firstly, revenue has kept coming in extremely
well; but the continuance of that phenomenon depends on the development of events in China over which we have no control
and we cannot safely rely on the flow of revenue continuing
at its present rate. On the other hand the emergency may
at any time involve us in considerable expenditure
-
relief
of refugees, measures to deal with epidemics, frontier control, etc., and it is therefore safer to have ample funds
in hand.
Secondly, the emergency has also resulted in
large essentially temporary payments of revenue in the way of duties on tobacco and petroleum intended for re-export,
on which we have to pay drawback in due course. These drawback demands are large and irregular (we at one time had over $1,000,000 in a special petrol duty account, all paid
out again within a few weeks). We have, therefore, to keep further funds in reserve against these liabilities.
Thirdly, the recent exchange disturbances
rendered it impossible for the moment to remit at the same
rates as we were doing last autumn. The extra interest is
not sufficient to offset the loss on exchange if there is a prospect of higher rates prevailing in the next few months. Rates are in fact now higher than they were two months ago, and I remitted £100,000 a fortnight ago and expect to remit more shortly. I hope, therefore, to be able again to keep
the