Sessional_Paper_1887-1888 — Page 129

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No. 32.

SIR,

TREASURY,

HONGKONG, 22nd May, 1885.

With reference to the Secretary of State's Despatch No. 81 of April 1st on the subject of One Dollar Notes, which His Excellency the Governor has been pleased to refer to me for report, I have the honour to submit the following observations:-

2. Lord DERBY sums up the matter as follows:— "If inconvenience is still felt in the Colony owing to the deficiency of $1 notes, the only course to adopt will be that which has already been put before you with the sanction of the Trea- sury, whereby the Colonial Government itself should undertake the circulation of these notes against a bullion reserve. It now becomes my duty to point out that, in the present state of the Colonial Revenue, the demands upon it being so nu- merous and pressing, so conflicting, I may almost say so bewildering, the heavy expense of issuing and maintaining notes is out of the question. The incon- veniences of course will remain, but it is the unanimous opinion of those best able to judge that they may be much diminished by a liberal and constant supply of subsidiary silver coin.

3. I trust therefore that the Requisitions I shall have to make for this des- cription of coin will not alarm either the Colonial Office or the Treasury. It must be clearly borne in mind that it is impossible to flood Hongkong with these coins, as a colony like Mauritius or Ceylon might be flooded with them. As fast as they arrive they are bought up and sent into China, where they seem rapidly to be becoming a popular and useful coinage, the only one, except in copper, that there is. There is not the least symptom of a cessation of the demand,

nor of any limit to the amount of coin that could be disposed of. The only way to avoid the inconveniences consequent on a scarcity of small coin here at such times as Chinese New Year, &c., is always to have a reserve to fall back upon.

4. Two shipments of these coins, amounting in all to $270,000, have been ordered from England.

I have the honour to be,

Sir,

Your most obedient Servant,

The Hon. W. H. MARSH, C.M.G.,

HONGKONG.

No. 34.

Governor

SIR,

Colonial Secretary,

&c.,

&c.

A. LISTER,

Treasurer.

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DOWNING STREET,

17th August, 1885.

I have the honour to acknowledge the receipt of your despatch No. 244 of the 26th of May last, reporting that your Government has decided against undertaking an issue of One Dollar Notes, and proposes to meet the difficulty arising from a scarcity of subsidiary currency by an increased issue of token coins.

Although there does not seem to be any present danger of these coins being forced, perhaps at a discount, I think it right to remind you that, in view of such a possibility in future, they should only be issued in response to a legitimate demand, keeping the supply short rather than full.

I have the honour to be.

Sir,

Your most obedient humble Servant,

Sir G. F. BOWEN, G.C.M.G.,

&c.,

&c.,

&c.

FRED. STANLEY.

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