CO129-283 - Acting Governor Major Gen Black - 1898 [5-6] — Page 402

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Dear Sir,

SUB ENCLOSURE

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397

C. O.

15369

eN JUL 13

Hong-Kong & Shanghai Bank.

6th. June, 1898.

I have the honour to acknowledge your letter

of this date, in which you point out that our note circulation

was in excess of our limit by $770,787 on the 31st. of March

last. The matter has had our most serious attention. The fact

is the Chinese hoard our notes; once we pay them out, it is most

difficult to get them back. If we refused to give out notes,

and offered coin there would be a sort of panic among the

Chinese. It is only when they want money for shipment to Can-

ton, or the Coast Ports, that they will accept coin, and even

then they only change as few of our notes as they possibly

can.

I would have approached the Government about

the subject of your letter some time ago, if it were not that

we have decided to withdraw our note circulation in the Straits

altogether, as soon as the Straits Government are ready with

their issue, which I am informed will be very soon. In the mean-

time I would point out that on the 31st. of March the funds

in the hands of the Crown Agents in London were $766,000 in

excess of the amount required as security for our note issue,

The Hon. A.M. Thomson,

I

Colonial Treasurer.