CO129-334 - Governor Nathan - 1906 [5-7] — Page 580

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non acceptance of the Chinese coins by the

Government and banks make these of slightly less

value in the Colony. The difference will increase

if mercantile firms follow the example that has

been set by the Government and some of themselves

in declining to receive the Chinese coins.There

will also be a tendency for the Hongkong coins to

return to the Colony.

(ii). The Canton mint may cease issuing subsidiary

coins. Those they have already issued and with

them the Hongkong coins would tend gradually to

recover their former dollar value as absorption

took place and they became a subsidiary rather

than a main currency.

(iii).The Canton mint may issue subsidiary coins

of lower millesimal fineness than the present

ones. This would result in a further impoverish-

ment of the Kwang Provinces for the temporary

advantage of the Canton Treasury. The new coins

which, to secure their acceptance, would have the

same appearance as the old, would drag the value

of the latter down with them. The Hongkong coins

with a value intermediate between that of the

dollar and the Chinese coins would tend partly

to disappear from circulation in China by being`.

melted down to form the new issue as dollars are

now being melted down to form the present issues,

and partly to constitute a third standard of

value for commodities in the same way as commodi-

ties are now beginning to have two prices accord-

ing to whether payments for them are made in

dollars or subsidiary coins. It would be as im-

possible then to prevent the new issue from being

generally current in Hongkong as it is now to

prevent

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