18
A.
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Reply of Majority Report Signatories to His Excellency's Memo. of the 10th November, 1907.
II.-PROHIBITION.-Import, EXPORT AND CIRCULATION.
(a.) Import of Chinese subsidiary coins. The Majority consider that permits should be issued only to the extent necessary for carrying on legitimate exchange business in the Colony; that there should be no licence fee; and that no such fee would be justifiable inasmuch as it would be a tax on legitimate business, which would be deranged unduly thereby.
(b.) Import of coins which are legal tender. No repudiation of our coinage can be
entertained.
Anything in the Draft Bill inconsistent with the Report should be modified but the Bill only gives powers which may or may not be exercised.
The Report does not advise that prohibition of import of our own coin should be imposed at all events in the present circumstances of the case, but if the words in the Bill are thought objectionable they can be deleted.
(c.) Export of coins which are legal tender. This is a matter similar to the above. No recommendation is made in the Report to prohibit export in present circum- stances; it was only advised that power might be taken to do such in case it might be considered necessary in the future.
The Majority do not advise any agreement with the Government of the Two Kwang in the matter as they consider the question one for the Hongkong Government alone.
There is not the slightest fear of any great export business so long as the coinage is at 5% discount, and the question would therefore not arise till it is at par, or at a premium.
The objection to relying on a reserve is that Government has a large quantity of coins locked up whereas it might be reduced to have a corresponding overdraft for carrying on the ordinary business of the Colony.
The enforcement of the prohibition would be largely a matter of experience but the giving of rewards to informers as contemplated is a very effective
measure.
(d.) Circulation of prohibited coins. No difficulty arises as circulation is to be pro-
hibited in toto.
Coins imported under licence are only to be used for exchange purposes. The Money Changers will not do any more business perhaps than they have been doing recently but in any case it would be invidious for Government to discriminate them from other legitimate business in the Colony by putting on a special tax.
The whole Report of the Majority is modified by paragraph 17 which would allow prohibition of circulation to be deferred for such time as Government considered expedient.
The Majority have no objection to the influx of Hongkong coin in any case. III. WITHDRAWAL OF HONGKONG COINS FROM CIRCULATION.
The word "prohibition" as used in the Majority Report means total prohibition of circu- lation (after due notice) and, in addition, to assist such prohibition, partial prohibition of import of alien coins.
Hongkong coins are not considered under prohibition in present circumstances.
The Majority consider that prohibition is necessary to give full and proper effect to the policy of withdrawing Hongkong coins from circulation, and that the prohibition of circula- ion of alien coins is the first important point in the matter.
The present policy of the Government may be continued but no coins sent home for melting and sale till a final decision as to further action has been arrived at.
No purchases of coins in the open market should be made in the meantime,
A. M. THOMSON. A. J. RAYMOND. ROBT. SHEWAN, WEI AYUK.
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