CO129-534-6 Loans for public works 24-2-1931 - 11-8-1932 — Page 73

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1932 above to $10,000,000 and the total in the six years

to $26,650,000.

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There

The annual charges have next to be considered and

for this purpose it is necessary to come to some decision

as to what form the loan should take; whether in sterling

raised in London or in dollars floated in Hong Kong.

is no doubt that a dollar loan could easily be raised

locally for $5,000,000 at from 4% to 4%. At the present

time there is a good deal of money seeking investment in

trustee securities and no dollar trustee stock available.

It should be remembered that the dollar loan of 1927 is

probably the only silver trustee security in the world today.

It is for the small amount of $5,000,000 and the bonds are

very tightly held. A dollar loan would be very attractive and popular especially if issued in bonds to bearer. It is

however for consideration whether it would not be advisable

to raise the money required in 1931 in London either in the

form of Treasury Bills for a year pending arrangements as to

floating a larger loan in 1932 for the total then required both for loan purposes and to redeem the bills or to obtain the money required this year under the Domestic Loans scheme.

On the whole I think Treasury Bills would meet the present

situation but on this point I think the advice of the Crown Agents should be asked. Sinking Fund monies must be invested in sterling and with a low value dollar the advantages are

in favour of sterling borrowings. Whether the whole scheme

of loan works is approved or not money will be required this year to finance work now being carried out on the present Waterworks Development Scheme, the Aerodrome and the Vehicular Ferry. The Colony's cash resources will not meet the position during the second half of 1931 and funds will be required by the Crown Agents to meet London Commitments.

Reckoning