Sessional_Paper_1907 — Page 1020

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We believe that the following extract from the South China Morning Post of the 27th March, 1906, sets out the facts accurately and will place your Lordship in possession of the material points so far as the Chinese coinage is concerned :-

"The Chinese subsidiary coinage nuisance is becoming worse than ever. These coins are pouring into the Colony from the interior and the Banks accept them, reluctantly, at a discount of $45 on the $1,000. Firms handling large sums can protect themselves by discounting payments at the Bank's rate, but the hardship falls on the poorer people, the small dealer and the purchaser. The Tramway and Ferry Companies must also sustain heavy losses on this debased coinage, and surely something can be done to check its circulation. The public see very little Hongkong small coinage, for the simple reason that being of higher value than the Chinese coins, it goes into the interior and does not return, unless in the shape of Chinese pieces after being reminted. As we have pointed out previously and repeatedly, not only is the Viceroy of Canton robbing the Hongkong Government of its profits on the circulation of subsidiary coinage, but his cheaper substitutes are driving British coins out of circulation in the Colony, and the public when paid for one British dollar five twenty-cent Kwangtung pieces are actually losing 4 cents equal to $4.50 discount on the $100. Chinese servants and workmen naturally refuse the Chinese subsidiary coins on account of the loss they would sustain. Whilst the local Government offers no protection to the public, and allows the Chinese authorities to appropriate its profits, it curiously enough refuses to allow the Post Office or other departments to accept Chinese coins, greatly to the inconvenience of the public who frequently have nothing but Chinese coins in their possession owing to the scarcity of Hongkong money. At the same time it often happens that the same department tenders Chinese money as change! The Government should take this matter in hand, for the evil is rapidly becoming worse. Singapore and French Indo China decline to admit any silver money to be circulated within their borders but their own, and refuse to allow any outsiders to participate in their lawful profits ou minting and circulating coinage. Of course we shall be told that owing to the proximity to dear old Canton it would be impossible to restrict the importation of foreign coinage-but, the fact remains that the present arrangement is bad and is a hardship and our Government has never tried to check it. It might try."

A fact, however, that does not appear in the above, and which the Board have only quite recently learnt is that, owing to a decreased demand for British coins in the interior of China, the same are at a heavy discount in Hongkong. The Board are of opinion that it is far from desirable that British coins should be at a discount in a British Colony.

When the attention of the Board was first drawn to the matter, they were under the impression that the Chinese coins were legal tender, but on enquiry the Board find that this is not the case.

The Company's Manager in Hongkong has mentioned the matter to His Excellency the Governor, who advised that the only remedy which to his mind could prove efficacious was for every person trading in the Colony to decline to accept any other coinage except that of the Colony.

The Board have instructed their Manager to try and arrange with some of the largest recipients to act as His Excellency suggests, but they fear that not only is there likely to be delay in such a course, whereas the matter is pressing, but also that such a movement may be unsuccessful owing to the difficulty of obtaining united action.

The Board, therefore, respectfully submit to your Lordship that it would be possible:-

(a.) For the Hongkong Government to make such coinage illegal and to abolish it in a similar way to that which the British Government adopted some years ago in getting rid of the Continental copper coinage which was tendered to so great an extent in the United Kingdom,

and

(b) lu any case for the Hongkong Government to give instructions to their officials not to tender Chinese money in change for Hongkong coinage.

In conclusion, the Board venture to trouble your Lordship further by showing how hardly the matter operates on this Company.

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