CO129-416 - Public Offices - 1914 — Page 293

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Hillier suggests advance from Reorganization Loan

funds could be made to Chinese Government free of

interest, to be repaid either from second Reorganization

Loan when issued or from surplus Salt Revenue as and

when available, funds to be held by the Group Banks

Canton who would redeem notes at fixed price on present-

ation.

N. J. Stabb suggests scheme on following basis.

Canton authorities to give full particulars outstanding

note issue and binding undertaking not to issue further

notes the Group Banks to advance Canton Treasury say

dollars 500,000 for redemption notes and further amounts

as cancelled notes handed over and destroyed.

Probably dollars 1,000,000 per month will be

sufficient.

Notes to be redeemed at about thirty per cent dis-

count and checked and cancelled by approved Chinese

official in co-operation with nominated European offi-

cials.

N. J. Stabb's opinion is scheme on forgoing lines

honestly carried out will very soon restore confidence

and

and amount of notes to be redeemed will probably not

be large also if it become known that such scheme was

to be adopted an immediate and substantial improvement

in value of notes and better feeling generally would

result.

Scheme would be abortive unless Canton Government

can finance itself without issuing further notes.

N. J. Stabb further wires our opinion is every

possible endeavour should be made to carry out scheme

both in the interests of China generally and of this

Colony.

With reference to the forgoing we have not con-

sulted the Groups representatives Peking pending approval.

of His Britannic Majesty's Minister. Forgoing tele-

graphed to you in the absence of Hillier therefore

please do not consult other Groups without further

telegram from him.

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