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circulation and retained in the Treasury. The sale of these coins as bullion will, it is estimated, involve a loss to the Revenue of about $40,000 per annum.
It is clear, therefore, that the Hongkong Government have already taken steps for some time past with a view to rehabilitating its own currency which circulates in the two Kwang Provinces, and is at a similar discount there. The effect of these measures is already apparent by the fall in discount on Hongkong subsidiary coins from nearly 10 per cent to nearly 4 per cent.
In March last the Viceroy's predecessor prohibited the manufacture of subsidiary coins by the Canton Mint for a period of 3 months, and I am given to understand that since that date subsidiary coins have not been coined by the Treasury at Canton, and that the effect of this action is also apparent by the fall in the discount of Cantonese subsidiary coins in almost the same proportion as in the case of the Hongkong coins.
The stocks of subsidiary coins issued by the two Governments are, however, so great that the steps that have been taken must be continued for some years before the coins again reach par, and thereafter it is necessary that future manufacture and issue should be strictly regulated in order that the coinage may be maintained at par.
The Hongkong Government is prepared to give a pledge that they will not again manufacture or issue subsidiary coins till parity is reached and that thereafter they will regulate its manufacture and issue so that parity may be maintained. But it is obvious that as long as Cantonese subsidiary coins are allowed to circulate in the Colony the effect of such restriction by the Hongkong Government will be neutralized unless the Provincial
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6 JUL 8
25
eireulation and retained in the Treasury. The sule of
these coins as bullion will, it is estimated, involve a loss to the Revenue of about $40,000 per annum.
It is clear, therefore, that the Hongkong Government have already taken steps for some time past with a view to rehabilitating its own currency which circulates in the two Kwang Provinces, and is at a similar discount there. The effect of these measurae is already apparent by the fall in discount on Kongkong subsidiary coins from nearly 10 per cent to nearly 4 per cent.
In March last the Viceroy's predecessor prohibited the manufacture of subsidiary coins by the Canton Mint for a period of 3 months, and I am given to understand that since that date subsidiary coins have not been coined by the Treasury at Canton, and that the effect of this action is also apparent by the fall in the discount of Cantonese subsidiary coins in almost the same propert- ion as in the case of the Hongkong coins.
The stocks of subsidiary coins issued by the two Governments are, however, so great that the steps that have been taken must be continued for some years before the coins again reach par, and thereafter it is necessary that future manufacture and issue should be strictly regulated in order that the coinage may be maintained at
par.
The Hongkong Government is prepared to give a pledge that they will not again manufacture or issus subsidiary coins till parity is reached and that there- after they will regulate its manufacture and issue so that parity may be maintained. But it is obvious that as long es Cantonese subsidiary coins are allowed to eirculate in the Colony the effect of such restriction by the Hongkong Government will be neutralized unless the
Provincial
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