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PUBLIC RECORD OFFICE

Reference :-

TELEC.O. 882

5 PUBLIC RECORD OFFIC

ALLY WITHOUT PERMISS BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO

OF THE

DON

Afr. W. G. Gulland,

13 July 1893.

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COLONIAL CURRENCY COMMITTEE :

"merchant the inconvenience and uncertainty which attends the fluctuation of exchange. The manner “in which it is proposed that this should be done would be to revert to the legal tender, which was "the only legal tender in these Settlements until the ** transfer in 1867, namely, the rupee, and that to the ** rupee should be attached a fixity of value—which I #saw the other day placed as low as 1. 3d.-and that, with the measure of this coin, we should "froneset our daily business. The Mexican dollar "would, of course, flow in and out, both for imports and exports, as readily as now, and would form the "medium of exchange with the neighbouring silver countries. Such a system exists in Shanghai, where "the currency is sycée, and yet Mexican dollars are "sent up country in large quantities to silk and "cotton districts, and the price rises or falls accord- ing to the demand of the market. A good inany "years ago, on the west coast of Sumatra, the "Carolus dollar was the only one taken, and it was bought at a large premium, so as to enable the "Chinese and others to purchase their crops. And quite recently we know Mexicans have been taken for the same purpose at a considerable premium.” These are his figures I want to rend :—“ I have hero

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a table of the principal country with which we are trading, namely, Netherlands India, and I have "taken these figures for the last 20 years. Our trade *in Netherlands India in 1871 was 5,000,000 dollars. In 1873 it had risen to 14,500,000 dollars, but the "increase had nothing to do with the question of exchange, which was practically the same. Those of us who resided in the colony at that time know that it wrs in consequence of the first introduction of stean: communication-of Chinese first becoming *the owners of steam vessels. Then, in 1877, the "dollar having fallen from 48. 43d. to 48. Oğd, the trade was somewhat lower, being 13,625,000 dollars. "In 1881 the trade was 24,750,000 dollars, the dollar "having fallen 3d, and in 1887, although the dollar "had fallen another 7d, the trade had increased only **to 25,000,000 dollars. In 1889, which may be de- *scribed as one of the bumper years of trade the amount was 33,500,000 dollars, the exchange being 3 tha and in 1891 it was 30,760,000 dollars, "exchange being 31. 34d." The fact of the matter is, exclringe has not so much to do with prices as people think; it is more a question of supply and demand, and the requirements of trade. Our great inconvenience at Singapore is the Anctuations. For general business it really does not matter what the dollar is. But what we cannot stand against is a variation of 10 to 20 per cent, in a week. As silver becomes demonetised, and becomes a commodity, these fluctuations will probably be much greater.

308. (Mr. Courtney.) I asked you if you had more embarrassment with Java than with Hong Kong ?— I sail, ro.

309. You said Chinamen perfectly understood; you then began to go into the question of trade with China ?-The Chinese are the great distributing anerchants in the Straits Settlements,

310. You do not export to the orders of the Dutch merchants ?—No; Englishmen do but little locally; Chinamen have nearly all of the trade. We English merchants take European goods out to Singapore, and sell them there; the distribution from Singapore is done by Chinese,

311. (Mr. Mende.) You mean the Chinese in Singapore ?--Yes.

312. Who are the distributing merchants ?--Yes, the Chinese are the distributing merchants.

313. (Chairman.) You do not speak from your own experience when you may trade would not be cin- barrassed, because it is felt by the Chinese ?—Yes; but yon me by the growth there las been no em- Larrastrept

314. As a matter of fact, the money value of trade in Java dore not seem to have increased much since ste.om communication was introduced ?—Of course it

made a sudden jump by these figures, but it goes on. steadily growing.

315. From that time, having regard to the fall in the value of the dollar ?-I do not think the dollar affected it much.

316. (Mr. Courtney.) Suppose you convert these dollars into gold, would there be any remarkable increase ?-It would still show an increase,

317. The amount of dollars, valuation in gold?— That I have not worked out.

818. It is very easy. There is no increase in actual gold value ?-Not so much, still an incrense.

319. Is that the case in Hong Kong, no increase in actual value?-Hong Kong is on the same basis with us.

320. (Chairman.) One wants to see if there is any increase ?—I have not got the figures.,

321-2. We want to compare the progress of trade in Hong Kong and Java?-The progress with Hong Kong is not so marked, I think.

323. (Mr. Fairfield.) But you send more goods-a larger quantity ?-We send more goods, but there is the same sterling value as if the quantity was

Boller.

324. In measuring trade one sometimes wants to know what quantity of commodities people get for their money? When you turn it into sterling it looks very different.

825. (Mr. Mende.) What was the view of the meeting in the City, did they agree with you ?—At at the first meeting there were three for gold, soven ngainst; at the last meeting there were six to nine, but to make the unjority three members of one firin had to vote.

326. In advocating your views ?—No, against. 327. (Mr. Courtney.) Three to nine in proportion, or were there only twelve there ?-Six for and nine against. There were about twenty present.

328. And the other six? They did not vote at all.

329. (Chairman.) In the figures you gave us in comparing the silver and gold exports of the Straits, did you put Netherlands India ? Taking the "exports in the same way we find that to the United "Kingdom we exported 24,000,000 collare, to Dutch "India 28,000,000 dollars.”

830. What year was that 28,000,000 dollars ?---

1891.

831. This (Mr. Shelford's speech) is 30,750,000 dollars in 1891 ?—That is 1,250,000 dollars difference. The figures in Singapore are not so carefully made up as they might be. There is a discrepancy between what my partner said in the Chamber of Commerce and my figures; and I cannot make it out by the Gazette. You have the Gazette?

382. (Chairman.) That 28,000,000 dollars that you gavo us is what he gives at 80,750,000 dollars with the dollars at 34. 8)d. ?—In these figures that you have just been reading in your partner's speech, where he speaks of trade with Netherlands India, is he speaking only of the export trade?--I take it so, but he talks of "trade," so it might be either, or both imports and exports.

333. The two together would be much more?

334. (Mr. Fairfield.) This gentleman speaks of of Netherlands India, but perhaps his partner spoke only of Java.

335. (Chairman.) They speak only of Netherlands India, but it must be more than 31,000,000 dollars if you take the exports and imports.

336. (The Secretary.) These figures are not very necurate, because there is no Custom House at Singapore.

837. ((kairman.) What was the dollar in 1891 ? —3r. 31d, it is given here ?-1 should not think it was so high as that all the year.

338. Oh, 1891, yes; that in the year silvor went up

so much? That must have been the time; the rest of the year it was lower, I think,

NINUTES OF EVIDENCE.

339. You bave not got 1892 ?—No, it was lower than that.

340. You have not got the trade statistics of 1892 ? --The 1891 statistics were published April 22, 1892. I do not know when they came out this I AM

year. afraid you will have to take the figures in a sort of general way, because, as has been explained, there is no Custom House in Singapore, and the merchants make their own returns.

341. (Chairman.) What is your suggestion as to the method of establishing a currency in Singapore on a gold basis. You would not suggest the introduction of the Indian rupee, I understand ?-To begin with, at least, I should advocate tlist, only in the shape of a dollar. As long as you call the thing a dollar, and have parts of a dollar, it matters little what it is. not suppose the natives care if you give them a double 1lorin if

you call it a dollar. They would not like a rupee with its anna and pie, or a sovereign with its shillings and pence.

I do

342. Yon would exclude the Mexican dollars from being legalised?-Certainly, they would be mere merchandise. I take it we should have to arrange with the Indian Government to take tack our Mexi- cans, and give us in exchange their currency. Of course it would be better if it were in the shape of a dollar, say, if we had a two-rupse piece.

343. You mean a piece of the value and intrinsic weight of two rupees ?-Two rupees. You might call it an imperial dollar, or what you like.

344. How would you regulate the amount of coin age with the imperial dollar ?—We have no statistics, we cannot tell the amount of currency we have out. The only thing we have as a guide is the bank's i-sac. You will find that in the Government Gazelle. I believe the Chartered Bank has two million and a half, the Hong Kong Bank three million and a half. I suppose the banks would call in these notes, and give out others in the new currency, so that not much coin would be needed in making the exchange. But there might be a large amount of Mexicans given in; one caunot tell.

345. But how would you keep up the value of your new imperial dollar to a certain ratio to gold In India the scheme is that coinage shail be limited, 90 as to keep to that ratio?- We would trust to India entirely to do it. We would relieve India of so much silver by taking double-rupees from her; it woull uake a larger market for her silver; in fact, the Mexican dollars given in exchange for her coin, if exchange were favourable she might sell them, and not have to take them back to India at all.

316. (Mr. Courtney.) But what the Lord Chancellor wants to know is, suppose you have a legal dollar on a gold basis, and have a law, what would be the schenie of that law ?We would simply say that hereafter the imperial dollar, or whatever it was called, would be the coin of the colony.

347. (Chairman.) Why would not that fall accord- ing as its intrinsic gold value fell in silver ?--Because Lankers need simply ship it to Calcutta to get the value of what it is worth in India.

348. You must work some method of the supply of dollars and the limitation of the supply. How would you work it ?—We do not want to limit the supply.

349. If you want dollars not to fall below BAY 2. 8d., you must limit the supply, or they would fall to 2a. Ad. ?—Our exchange would be regulated by that of India.

350. How would you tie them together, your dollar and the Indi■u rupes ?—Our dollar being two rupees, and taken in payment as they would be in India, would tie them together.

351. How would you prevent your dollar falling (as the Mexican dollar or the yên might fall) to 2. 4d.?-Our dollar, it would not matter what wo do; because the moment we ship them to India we get two rupean.

352. If you allowed an unlimitel number, it would affect the fudian exchange?—That India must look after. We simply extend the area over which Indian

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Mr. W. G. Gulland.

currency would go. When once we had made the exchange it would have the market.

353. (Lord Farrer.) You would amalgamate with 18 July 1893. India?—Yes.

I think many Singapore merchants would prefer a dollar coined in London, with gold held here against it, but I am told that would be bimetallism, so out of the question. We must, there- fore, full back on India.

354. You would have to do something in this way: to get the Indian Government to consent to a further law requiring them to jasne dollars in exchango for gold at the rate of 2. 8d. per dollar; and then you would get your limited supply of dollars, and no more dollars than were necessary to secure their perninneney ?-But we do not want to pay gold to begin with.

355. How are you to get them? They will not fall from the sky ?-If we sent the Indian Govera ment our Mexicans, would not they convert them into dollars ?

359. (Sir R. Welby.) No; that would be free coinage. It would depend on the way it was to be done; if the silver you sent in the shape of Mexican dollars were converted at the then gold value of silver into dollars, I daresay they might do it ?—If we had done it concurrently with India it would havo been comparatively a simple matter. But if exchange drops, it becomes more difficult, sud as exchange drops further, the more difficult it gets.

857. (Lord Furrer.) Do you propose to senil to Indie an unlimited quantity of Mexican dollars, or allow anyone to take Mexican dollars to be converted ? -No; it would be done through the Government. The Government of Singapore would have to issue a proclamation, and take the dollar in oxchange for the new currency. But how many dollars would come in it would be difficult to my.

358. (Chairman.) What is the present value of the dollar ?---To-day, 28. 61d. for four months; that would be 2x. 64d. for sight in Loudon.

859. Being now 2s. 6d., you would require Govern. ment to give two rupees, which would be practically 2. Ad. ?—You see that is the difficulty, how we are to make the change; not whether the natives would like it. I do not think they would care two straws,

860. (Lord Farrer.) They have not been incom- moled by the co-existence of two dollars, though of the same weight ?—No.

801. Would people use these, and not continue to use the old Mexican dollars P-If they chose to use the old Mexican dollar they could do so. It would not be a legal tender; but they would be bought and sold the same as the Dutch guilders and other foreign

coin now are.

302. (Chairman.) Can yon form an estimate of the sterling amount necessary for the new dollar ?—{ am sorry to say I cannot. The shipments of Mexicans do not come specially to the Straits; they come to Penang for orders, and are ordered on as the banks want them, so it is impossible to form an estimato of how much the Straits taken în a year. And, again,

when they come to Singanore they are distributed all over the Archipelago. What we want is a guaranteed coin inside the colony to protect our capital, and let trade outside go on ne it likes. We do not want to interfere with tradɔ in any way. It is no use making a certain sun one year to find next year it is only worth perhaps half the amount.

383. You mean to protect your interest in locka and houses ?-To protect our interest in docks and houses, and in mortgages. It is a hard case; men who have come home and thought they were well off for the rest of their lives, are not getting half the income they used to get. The thing will dwindle still further if nothing is done.

384. That is going on through the fall in silver ?— Through the fall in silver.

865. What you want is to make exchange with gold countries independent of the fall in silver ?—Yes, we want more stability.

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