CO129-362 - Public Offices - 1909 — Page 9

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C.O. 22375

This Document is the Property of His Britannic Majerty's Town Recit

Race 5 JUL 09

CHINA TRADE,

CONFIDENTIAL.

[22177]

No. 1.

[June 14.]

SECTION 2.

(No. 197.) Sir,

Sir J. Jordan to Sir Edward Grey.-(Received June 14.)

Peking, May 27, 1909. WITH reference to my despatch No. 142 of the 1st April last, I have the honour to transmit to you herewith copy of a note which has been addressed to Prince Ch'ing by the dean of the diplomatic body urging upon his Highness the necessity for the reform of the currency in this country, and, as a first step, the immediate suspension of the further issue of bank-notes and copper currency.

I have, &c.

J. N. JORDAN.

Inclosure in No. 1.

M. de Carcer to Prince Ch'ing.

Your Imperial Highness,

May 21, 1909, THE consular officers of the various treaty Powers and the foreign chambers of commerce and other business organisations in China have of late repeatedly called the earnest attention of the diplomatic body to the highly unsatisfactory state of the currency in China, resulting in a large measure from the depreciation of the copper cash currency and the constantly increasing issue of bank-notes. Both of these causes have already proved serious obstacles to trade in all parts of the country, and it is feared by the foreign business interests that, unless sound measures are promptly taken to regulate these evils, they may precipitate a financial crisis, the consequences of which will be far-reaching and not improbably disastrous.

In a communication which the dean of the diplomatic body had the honour to address to your Imperial Highness on the 28th November, 1908, he called your serious attention to the danger of allowing the uncontrolled issue by Chinese banks in Shanghae and in the province of Chekiang of dollar bank-notes without the security of properly regulated metallic reserves. Your Highness replied under date of the 17th December, 1908, that the subject was receiving the attention of the Ministry of Finance, and that you would advise the diplomatic body at an early date of the con- clusion reached by that department of the Government.

It is a serious disappointment to the diplomatic body that down to the present no indication has been given it by the Imperial Government of the decision it has reached in this matter.

In the meanwhile the depreciation of the copper currency, due solely to excessive issue, is steadily increasing every month, and adversely affecting the interests of millions of people throughout the Empire. At Shanghae, for example, when these coins (10-cash pieces) were first issued, they circulated at par, although intrinsically worth only about 60 per cent. of their face-value. Excessive supplies, however, brought about their depreciation, and of late the profit on minting them has disap- peared. Debased coins of a lower standard are now being issued, which also circulate at a constantly increasing discount. The continuance of these unfortunate conditions must inevitably augment the difficulties and dangers of the general financial situation.

Deeply sensible of the danger of delay in remedying the evils arising from these two causes, the diplomatic body has directed me to urge upon your Imperial Highness, in its name, the importance of taking prompt and effective steps to deal with them. In the opinion of the diplomatic body, as well as in that of all our consular representa- tives in China, and of all foreign chambers of commerce, the first measure to be taken should be the immediate suspension of the further issue of bank-notes and of copper currency.

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I avail, &c.

DE CARCER.

P

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