CO882-(6-8) — Page 205

PUBLIC RECORD OFFICE

Reference :-

PLLC.O. 882

8 PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO

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of the 22nd of July last,* and of your telegrams of the 14th and the 28th of August, relating to the arrangements to be made to meet the difficulties caused by the out- break of "surra" in Mauritius, and to confirm my telegram of the 1st instant, in which I expressed my approval of the scheme for a loan to assist the introduction of mechanical transport for canes and other produce and informed you that the draft of the necessary Loan Ordinance was being prepared by the Crown Agents for the Colonies.

2. I have also requested the Crown Agents to furnish you with full information with regard to the Decauville and other systems of light railways in use on sugar

estates.

37491

No. 12.

I have, &c.,

J. CHAMBERLAIN..

GOVERNOR SIR C. BRUCE to MR. CHAMBERLAIN.

(Received 4.24 p.m., September 8, 1902.)

TELEGRAM.

[Copy to Crown Agents, September 11, 1902: 37491: not printed.]

[Answered by No. 13.]

Referring to your telegram, 1st September,t re tramways. In order to meet cases of parcelling of estates in minute sub-divisions among small proprietors in accordance with local custom, I propose to make refund of loan condition precedent. I am not sure that it is necessary (to) fix limitation on amount of loan to be raised but if necessary would suggest £100,000 instead of Rs. 1,000,000.

37491

No. 13.

MR. CHAMBERLAIN to GOVERNOR SIR C. BRUCE.

(Sent 4.10 p.m., September 9, 1902.)

TELEGRAM.

[Copy to Crown Agents, September 11, 1902: 37491: not printed.]

Your telegram of 8th September.§ Approved, except that in the absence of further particulars I consider that limit Rs. 1,000,000 should not be exceeded.

39507

SIR,

No. 14.

CROWN AGENTS to COLONIAL OFFICE.

(Received September 22, 1902.)

[Copy to Governor, September 23, 1902. No. 235. L.F.] [Answered by No. 47.]

Mauritius Loan.

Downing Street, London, September 22, 1902. I HAVE the honour to acknowledge the receipt of your letters of the 3rd and

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11th instant, having reference to the request of the Government of Mauritius to be allowed to raise a loan to assist the planters in introducing mechanical transport on. their estates.

2. We gather from the telegraphic correspondence which is enclosed for our information that it is contemplated that the loan should have a currency of ten years, that being the period within which it is proposed that the planters should be required to pay off the advances made in respect of their estates.

3. In these circumstances it will be necessary that the loan should be issued in the form of debentures, as the currency would be too short for the ordinary investor in inscribed stock. We would also suggest, for Mr. Chamberlain's con- sideration, that the debentures should be issued with a double currency, i.e., repay- able at the option of the Government ten years after issue, or by six months' notice at any subsequent date within a further fixed period, say 10/20, or 10/30 years, the latter period being quite immaterial. This arrangement would enable the Government to postpone for a time the repayment of the loan if the sinking fund should prove inadequate to liquidate the debt, or if, for any other reason, it might be thought desirable to increase the currency of the loan for a short period.

4. It is not possible to say in advance at what rate of interest such a loan could be raised, but at the present time we do not think that less than 4 per cent. on a par basis would have to be paid. This rate is, however, we think, the highest at which the loan should be issued, and we should hope, when the present stringency in the money market, owing to the great mass of unabsorbed securities which are in existence, has passed away, that it might be possible to raise the loan on a 34 or 31 per cent. basis.

5. The short currency of the loan will, however, necessarily enhance the rate of interest which will have to be paid for it as compared with inscribed stock with a long currency, and the sinking fund to liquidate it must, of course, be very onerous. Taking 3 per cent. as the probable rate at which investment of the sinking fund would be effected during the ten years' currency of the loan an annuity of £8 18s. Od. per cent. will have to be provided and remitted in respect of the sinking fund, and this amount while including the estimated expenses of issue and redemption, and our charge for paying the interest on the loan does not include any expenses which may be incurred in the Colony, the amount of which should be calculated in the Colony, and added to the annuity. The rate of interest at which the loan was raised would, of course, also have to be provided for and remitted.

6. As regards your request that we would draft the necessary Ordinance, we do not see how it is possible for us to do so. We gather from the telegraphic corre- spondence that the annuity to be paid by the planters will be charged on the estates in somewhat the same manner as in the case of the Agricultural Loan Ordinance, No. 4, of 1898, herewith returned, and the new Ordinance can, therefore, it appears to us, be only drafted in the Colony.

7. So far, however, as the provisions necessary for raising the loan are concerned, it will only be necessary to enact that the loan is to be raised under the conditions set out in the material sections of the General Loan and Inscribed Stock Ordinance, No. 1, of 1887, viz., Sections 4, 5, 6, 7, 8, 9, 10 (part of) 12, 20 and 21 with the necessary additional provisions required in respect of a loan to be liquidated by an invested sinking fund in place of Sections 10, 11, 13, 14, 15, 16, 17, 18, 19, which apply to the liquidation of a loan by drawings.

8. Provision must also be inserted in the Ordinance setting out that the loan will rank after the Hurricane Loan raised under the provisions of the Ordinance, No. 4, of 1892, and guaranteed by the Imperial Government on the express condition that the priority of the loan should be acknowledged in any further borrowings.

9. I beg to add that we have taken steps to obtain catalogues and full particu- lars of all the light railway plant and traction engines with which we are acquainted. and that these particulars, so far as they have at present reached us, are being sent to the Colonial Government by the present mail.

I have, &c.,

W. H. MERCER.

• No. 7.

↑ Nos. 1 an 18,

‡ No. 9.

§ No. 12.

| No. 10.

Not printed: transmitting copies of Nos. 12 and 13.