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C.O. 882

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Mr. W. G. Gulland.

12 July 1893.

Mr. S. Gðullan.

12 July 1893.

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COLONIAL CURRENCY COMMITTEE:

435. (Mr. Fairfield.) Here is the course of exchange, maximum and minimum, for the last months of 1891? -You must remember that our population is not like that of India. It is all along the seaboard, and quite up to date, so that there would not be sneli trouble as in In in introducing new coinage. I suppose it could be arranged, if there was any profit the Straits should get a proportion.

436. (Chairman.) There would be considerable difficulty. In India you keep the payment in rupees, and the rupes has the same weight and fineness of silver; and you have so many rupees; by present coinage you prevent the rupees accumulating. But if you have a new double rupee everybody would take less silver. Not merely would you have the same coin as India, but you would make them take soine- thing less in silver ?—That would not matter as the coin could be madę larger,

437. But the effect would be to make it a more costly business?—Of course,

438. At present, if you exchange a Mexican dollar for one of the double rupee piores, at the gold value of the Mexican dollar, you would get what would be 2. 8d. for 2s. 6d. ?—Yes.

130. Well, that upon 10,000,000 dollars would not be a considerable sum. But supposing you require to have an additional amount of silver, it would be a more costly affair in the first instance ?-I think the 10,000,000 would be sufficient.

440. If the two-rupee dollar, though containing less silver, is by legislation artificially worth more in gold than the Mexican dollar, would people object to take the two-rupee instead of the Mexican dollar?-Cer- tainly not; and the natives are sufficiently wide-awake to see the difference.

441. (Lord Farrer.) Have you much circulation in bank-notes 7-Six million dollars in bank-notes.

442. Do they go to Hong Kong ?—No.

143. They remain in Singapore 7-Yes; the bankers would not cash them out of the district; it would interfere with the exchange business.

444. And the banks have no relation with one another in Hong Kong and Singapore ?—Oh, yes, they

are all the sanie.

415. But they do not take Singapore noies in Hong Kong?—No; if people want to remit to Hong Kong they must get bill on Hong Kong, paying the exchange of the day.

146. If you go to Singapore with a Hong Kong note they would not take it ?—If you were a traveller they would take it and charge you the exchange. There is Johore in this question.

447. (Chairman.) Abont these native states ad. joining Singapore, do they use yens and Mexican dollars?-Chiefly bank notes; and Mr. Swettenbam deplored the scarcity of bank notes owing to their being called in by one of the banks.

448. Johore is the only independent native state ?— Johore is the only independent state.

449. And that would be bound to follow the prac tice of Singapore ?—I think, if asked, His Highness the Sultan would do to; and if Singapore adopted this goid basis, I think Sarawak and North Borneo would do the same. I should think it would be to their interest to do so.

450. You would make a dollar for a double rupee? Yes.

451. Mr. Gwyther is willing to attend and give evidence ?—Quite.

452. Mr. Gwyther of the Chartered Bank of India and China; he does not wish to express an opinion whether gold should be adopted or not; but as to the machinery, how it should be worked he will give evi- dence? Anything technical, Here is a letter I wrote, proposing we should adopt the two-rupee dollar. Shall I leave it?

453. ( Chairman.) Yes, cerininly.

454. (Mr. Meade.)-Yon think distinctly there is no danger of disturbance on the part of the native population if they found they had to pay more than hitherto in dues to the Government ?-- I do not think they would object to paying in two-rupec dollars instead of in Mexicans or yens.

The witness withdrew.

Mr. SAMUEL GILFILLAN, of the Firm of Messrs Gilfillan, Wood & Co., of Singapore and London, called

in and examined.

455. (Chairman.) You are partner in the firm of Adamson, Gilfillan, Wood & Co. ?—Yes, carrying on business in London, and in Singapore as Gilfillan, Wood & Co., Singapore and Penang.

456. You have been connected with the Settlements for 40 years?-About that,

457. And were formerly a member of the Legis. lative Council ?—Yes.

458. You hare considered the question of the course which it would be expedient to take in the Straits Settlements with reference to the currency under oxisting circumstances ?-It has been matter of consideration among us, and my own conclusion is that nothing to advantage can be done at present.

439. Would you state the grounds upon which yon form that opinion ?--In the first place, it seems to me that our position in the Straits is in no way analogons to that of India. Granted that what has been done in India proves to be successful, it does not at all follow that the same action could be taken in the Straits Settlements. For one thing the trade of India is, to a great extent, internal; we have practically no internal trade. Singapore and Penang are like market places or landing stages, to which produce is brought from distant markets, and our position is entirely different from that of India in that respect. Then ogain the Indian rupee is the established currency, and has been for years, and the Indian Government has, of course, complete control over the rupen, We, in the Straits, depend on our dollar, which in one form or another, Spanish or Mexican dollar, or pillar dollar, has been the coinage known in that country from the time the trade was opened there. I do not

think it possible to do as has been suggested, to sub- stitute the rupee for the dollar. I think it would cause disturbance of trade, and cannot be effectus). I cannot see how it is possible to give arbitrary and fictitious gold value, irrespective of silver, to dollars over which we have no control, except in the very limited area covered by the law of the colony.

460. One suggestion is a new dollar coin, which should be a two-rupec pirce, that is to say, that it should be allowed to circulate in India as a two-rupeo piece, and in Singapore it should be a dollar, an im- perial dollar?-I cannot see what that would have to recommend it.

461. Of course if you coined only a limited number of those, and made those alone the legal tender, you might keep them up to a certain ratio to gold ?-You can, of course, do that in Singapore, and Penang, and Malneca nu regards transactions with Europeans; you can make it so between Europeans and natives, but you could not do it in native countries from which we draw supplies of produce, and to which we sent goods. All our customers deal in dollars, and have done from the earliest times of the trade.

India in the Straits Settlements -Yes,

462. You have large dealings with Netherlands

463. Take the people in Netherlands India-their transactions are in guilders?—In guilders.

464. And they receive for their produce guilders ? -Yes, if paid for in Netherlandı India.

tion to gold? Yes, in Netherlands India.

485. These guilders have an artificial value in rela-

466. What is suggested is, that in the Straits Settlements you might have an imperial dollar with

MINUTES OF EVIDENCE.

an artificial value in relation to gold, as the natives in the Netherlands do ?There, again, that often has occurred to me whether anything could be done in the same direction, knowing what had taken place in Duich territorios. It appears to me, however, that our position is not analogous to that of the Dutch. We are dependent upon a transit trade, from Singapore and other places, in be passed to other places, mainly to Europe. Whether we sell goods or import produce, the goods go to and come from countries over which the British Government have no control, with the exception of the Native States, which have been rising latterly into importance in the Malay Peninsula,

467. The greater part of your trade, we are told, is with countries on a gold basis?--I hardly think that can be so, except that a very large part of our trade is with Europe, and to a certain extent we may be said to be working on a gold basis, in every trans- action we have in dollars, in so far that the price we can pay for produce that is offered to us for sale depends upon the golil value of the dollar, seeing we are shipping to Europe, where we have to look for a gold price. And, again, if we are importing from Europe, and selling to the natives, we are to determine the price of the goods, by a gold value, as far as we can-as far as competi- tion will allow us. I would not say the bulk of the trade-except in that sense with Europe is with countries on a gold basis,

468. You have a large trade with Netherlands India ?—Yes, there is considerable trade with Nether- lands India. I could not answer, speaking at hap- hazard, as to its extent. I should doubt if we have as large trade with gold countries, if you exclude Europe, anything like so large as with countries on a silver basis. The great bulk of our trade is getting produca for shipping and getting goods for distribution-the bulk comes from silver countries where the dollar is used. The whole of the Malay Peninsula uses only the dollar, and in all Borneo, except where there are Dutch possessions, and the guilder is used, the dollar is used officially.

489. (Mr. Courtney.) Are you entitled to exclude Europe in your calculation of the total trade?—By no

means.

470. You are meeting the two tides, gold and silver; if you valued the transactions with gold and silver standard countries, have you any comparison what the totals would be ?—No, 1 have not.

471. Taking it that India must be regarded in future as a gold standard country, would you feel any difficulty in saying that on a comparison there would be 160,000,000 with gold standard countries, and 100,000,000 with silver standard countries? That includes opium; our trade with India is largely in opium.

472. That figure is given showing 160,000,000 of imports from and exports to gold standard countries, as against 100,000,000 to and from silver standard countries ?-I should think that might well be correct. I look rather to the wants of a place from a knowledge of the place and a knowledge of the transactions, and the difficulty that I would see is in giving a fictitious or arbitrary value to a coin to which the trade, from time immemorial, has been accustomed to give that to a coin in countries over which you have practically no control,

473. (Chairman.) Of course you understand in any questions put to you there is no expression of opinion by the Committee. There are two views. We are putting all the points to you, having heard the other side? I cannot see how, without dislocating the trade -the trade we all look to, namely, the trade with the natives-how you can displace the dollar and put in its place a coin that is to have an arbitrary value. In India the people have been accustomed to the rupes, and it may be they will succeed in giving it this com- paratively arbitrary gold value. There there is no other coin in competition. But it is not so in the Straits or in any of the countries from which we draw our trade. It would be upcossary to substitute for a coin we know another coin which in comparison is unknown, and

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Mr. S. Gilfillan.

which would have an arbitrary value. Suppose we take the two and a quarter rupee and give that value in gold in accordance with what has been done in India, and at the same time silver falla; the price of 12 July 1895. the dollar, which is intrinsically as good a coin, would be greater than the so-called double-rupee, or British dollar. My own feeling is in favour of a British dollar. As a British subject I share in the feeling of rather seeing British dollar than the Mexican dollar, and no doubt if the Hong Kong Government had per- severed the British dollar might have been introduced and might have replaced the Mexican dollar, That was unsuccessful, I think, because it was not per- severed with long enough. But this is entirely a different thing. It is not proposed to introduce a dollar which is simply of the me intrinsic value. That is not sufficient. You are going to give it a different gold value to a coin which contains the same silver and the same fineness. I think that would be practically inoperative.

474. Supposing you limited the number of imperial dollars, do you think it would be impossible to give those dollars a value above their intrinsic silver value ? -Think for a moment; you can do it in Singapore, in Penang, in the British colony; you can make this the only legal tender. When you get outside, how can that be done? You have to introduce an artificially valued coin against a coin the natives are accustomed to, and all their transactions have been in. They do not want your new coin, especially if that coin is to have an artificial value. I need not say the fall in silver is bad for us Straits merchants; it is little short of disastrous. It depreciates our capital, whether fixed or floating. Not only that, it prevents the investment of English capital in the Straits, and in the Malay Peninsula, thus retarding the progress of the Malay Peninsula. It also threatens us with extreme stringency of money every now and then, there will be a disposition to withdraw money from the Straits, and little disposition to send money out without a certainty of return; so that all our feelings are in favour of anything that would limit these evils.

475. (Lord Farrer.) You see the disadvantages of the present system, and yet think the change to a gold standard would be an evil. You have been giving a number of reasons why the present state of things and the fall in silver is disadvantageous ?—Quite.

476. Recognising these evils you do not wish to get rid of them by adopting a gold standard ?—I think practically they are irremediable, until silver risen, as it may rise under the influence of low prices and decreased production.

477. It is because you think the evil irremediable by any of the processes indicated that you object ?—Quite. All my interest points to a stable rate of exchange; that is to say, which shall only vary as between two gold countries. That is my interest; but if you ask me, as a reasonable man, whether that is practicable, I cannot say that it is.

478. (Mr. Courtney.) You say you might give a new dollar an artificial value within the colony, but not outside; is that a correct repetition of what you said ?—I would not go so far you might make it current so far as that it should be receivable by Govern. ment for taxes, shall become the legal tender, and shall have a certain fixed gold value, as is being done in Indila. Whether you could get Chinamen and natives to adopt that as the coin in which all their trans- actions shall be carried on, I am not sure.

479. You mean they will deal with the Mexican dollar, but not with the legal substitute ?—Tuko what happened in Hong Kong, which I remember to have read about, and also what took place in Singapors, when under the East India Company, I think about 1855. The East India Company were anxious to introduce rupees.

All our transactions with the Government were in the rupee, and they wanted ropoos acknowledged as the currency of the Bettlements. was a youngster, but my ceniors voted against it as fraught with mischief to the colony, and it was pre- yented, I think, by the Imperial Government. The East

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