CO129-523-12 Currency situation 17-2-1930 - 9-7-1930 — Page 86

Extracts from TIMES,

CHINA AND SILVER

PROPOSED BAN ON IMPORTS

(FROM OUR CORRESPONDENT)

SHANGHAI, MARCH 7,

The director of the Shanghai Bureau of the Ministry of Industry, Commerce and Labour has formally announced that the Ministry is recommending the Government to impose a ban on imports of silver coin into China and possibly of silver in other forms. The director emphasizes that the recom- mendation is the result of prolonged discus- sions with bankers and merchants; precaution was taken not to act hastily, but every it was felt that the Indian import tax rendered this self-protective measure imperative.

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China and Imports of Silver The silver market on Saturday dis- cussed with interest the announce- ment made by our Shanghai Corre- spondent that the Chinese Ministry of Industry, Commerce, and Labour was recommending the Government to impose a ban on imports of silver coin into China and possibly of silver in other forms. There had been talk in London market circles recently of the possibility of China imposing an import duty on silver, on the ground that the country was being made more and more a dumping ground for the world's surplus stocks of the metal, and that the action of the Indian Govern- ment in reimposing the silver duty made similar action on China's part imperative. The possibility of such a development has, however, not seriously disturbed the market; indeed, on Saturday silver made a further small recovery. The logical first effect of a duty should be to send the Shanghai exchange up and silver down. But doubts are expressed as to whether any marked change in the price of silver will occur. It is considered that with a country having so many foreign inlets as China anything in the nature of a ban on imports would be impracticable, and that an import duty would be much more difficult to make effective than in India. In any case, China's needs as a purchaser of silver will remain, and a duty will not prevent her obtaining all the silver she requires in the ordinary course of trade. The duty was re-established in India for revenue purposes; and China's need of revenue may conceivably have been at least as powerful a reason as the desire for protection in bringing the ques- tion of a duty to the front.