1939-03-09 — Page 26

HONGKONG TELEGRAPH

Hongkong Banks Will Loan £5,000,000 To Aid China Currency Stability

France May Also Aid Plan For Building New Railway

Faris, Mar. 8. Although France hesitates to make an official polley of grank- to ing credit to China, It ta learned that the Government L guaranteeing substantial amounts for → purchaseO France, notably automobiles, and is in addition guaranteeing credits of French manufactur ers advanced to China,

The French authorities acting as agents for French capital, are negotiating with the British for finanseing construction of the Barma-Yunantu Railway,

Figuren are not available of the sum required to finance construction of the railway, or the amount of commercial credlis already advanced от pending.

According to Chinese sources one of the biggest desta near- ing completion is a large con signment of tracks,

According to a London mes- sago, Members of the House of Commons were obviously sur- prised to-day by Sir John Simon's announcement, which is Interpreted

the most

downright steps Britain as a8 yet laken to assist China as well na to defend her trade there,

The first reaction in that whlie the scheme would not offend Japan, since it was con

flued solely to the question of sterling and the Chinese dollar, neverthelem, it reflects a stiffer atillade by Britain in the Far East than that evidenced for a long time-United Prear,

Famine Threat

TH

HE HONGKONG AND SHANGHAI BANKING CORPORATION AND THE CHARTERED BANK OF INDIA, AUSTRALIA "AND CHINA WILL · PARTICIPATE IN THE £5,000,000 STABILISATION FUND FOR THE SUPPORT OF CHINA'S CURRENCY.

roles was only fractional, the under-

This report, exclusively published in the "Telegraph" last Tuesday, was confirmed in tying tendency was very firm, London last night by the Chancellor of the Exchequer, Sir John Simon.

The Chancellor announce:l) restrictions on exchange will like

Under For that the British Government place from to-morrow,

dinary circumstances, this fack would had agreed to guarantee thb have had an adverse effect on Chinese Fund to the extent of £5,000,000, exchange, especially with London and thus enabling the two banks to New York,

FAITH IN CHINA'S participate in the scheme.

SOLVENCY SEEN

The stabilisation of the Chinese dollar is a matter of great impor tance to this country, in view of our financial and economie relations with China," the Chancellor said, in mak- ing the announcement.

London, Mar. 0. Mr. Que Tal-chi, Chinese Ambas- sador to London, in commenting on the loan announcemeat, said:

"The British Government's An- The Chinese Government has nouncement of a Joint exchange achieved considerable success In stabilisation fund for China doubly their efforts to maintain the conver- reflecta China's solvency alike in her tibility of Chinese currency for trade finance and trade, and in her terri transactions, to limit its depreciation | torial and administrative scope, In exchange against sterilng, and to "Britain's co-operation with China In- keep the rate reasonably stable for at this juncture Indicates the

creasing

that many months.

Awareness

Western Interests at Home and in the For East can best be maintained by the fullest legitimate support for China.

TO CONTINUE POLICY "They have informed His Majesty's Government, that they intend to con- Unue their existing monetary policy, and that as part of that polley they desire to establish

a stabilisation fund of £10,000,000 in addition to their other reserves.

"They invited the two Chinese Government banks to subscribe total of £5,000,000 to the fund, and two British banks, namely the Hong- long ond Shanghai Bank, and the Chartered Bank to subscribe a fur- ther £5,000,000 between them.

"The British banks have agreed to subscribe these amounts subject to receiving an undertaking from the Treasury to reimburse, them for any loss that might be incurred when the fund i wound up.

"The arrangement would be that the fund would operate for twelve months, but it could be continued for further periods of six months. by

agreement.

In Russia Growing Scarcity earlier fire. Of Food Supplies

MOSCOW, Mar. 8. A GROWING scarcity of food supplies, especially of vegetables and meat, in nearly all the large cities of the Soviet Union is making itself felt to an alarm-į ing degree, according to a report published by the "Izvestia."

"The arrangement will be warmly welcomed by my country, not only for lis material help, but also as of evidence that the community British and Chinese interests is to be protected." Reuter.

HOW LOAN WILL BE MADE London, Mar. 8, Sir John Simon, announcing in the House of Commons the formation by the Chinese Government of a stabill- sation fund of £10,000,000,- zald that two British banks had agreed to subscribe £5,000,000 between them, the remainder being found by two

Chinese Government banks.

The British banks had agreed to subscribe the amounts subject to re- celving an undertaking from the Treasury to reimburse them against. loss.

the

proposal.

banks such a guarantee, and a Bill The Treasury ngreed to give the "If the necessity arose, however, was being prepared to give legisla the fand could be wound up at any tive approval to

Reuter,

SHANGHAI REACTION

Shanghai, Mnr. 9. The announcement of the con- clusion of a £10,000,000 credit to China has been very well received in Shanghai's financial district his legislative ap- morning, and all the markets re- against as has not been seen here for some roval being obtained, to give to flected a feeling of confidence such these banks the guarantee

Ume. loss for which they ask.

announcernent The effect of the was most pronounced in the market

"His Majesty's Government would welcome the establishment of this stabilisation fund the successful work- ing of which would be of material assistance to British trade and enter prise in China, and the Treasury have

greed, subject in

"A Bill is being prepared, and I

hope to present it early next week." -British Wireless,

FFECT IN SHANGHAI

for Chinese domestic bonds, all is- sues moving sharply higher on a The scurcity of meat is especially

The effect of the announcement of wave of buying, induced by the burst Acute In Moscow, which received British financial aid to Chinn

of renewed confidence in the Chinese 20,000 hundredweight less than the been immediate.

Government. required amount, necessitating In Shanghai the exchange rate with Government Intervention.

New York Immediately jumped from

has

The paper desc

describes the meat 16% yesterday to 16 this morning,

Gains nt the opening averaged around $1, and although the high levels attracted some profit-taking. the market maintained a very steady appearance.

shortage being chiefly due to the de- with the market very firm. plorably bad management of the Sterling, which Wax quoted all State-operated dairy farms, the pro-81ail, yesterday, rose to 8.9/324, this The local dollars also benefited duction from which is constantly de-morning, with the market also very and hardened in terms of both sterl creasing despite increasing Covern- | firm.""

Ing and the United States dollar," and ment subsidies.—Trans-Ocean.

This significant that the Japanese while Improvement in exchange

One prominent exchange broker, questioned by "Reuter," described the effect of the announcement ne being "very beneficial to Shanghai's currency."--REULET,

Chungking-Hanoi Air Service

Chungking, Mar. 9. Arrangements have been made be- tween the China National Aviation Corporation and Air France for the Inauguration of an air service be- tween Chungking and Hunoi.

Joft

A Douglas plane of the C.N.A.C. Chungking yesterday morning for Hanoi on a trial flight. Aboard the plane was Mr. Hwang Pao-hsien. general manager of CNA.C., who was going to Hanol to have further discussions with the Air France re- garding the new air route.

Formal Inauguration of the servize will be announced soon. Central News.

SIMON ARZT

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PAPAL CORONATION

London Mar. 8. The Duke of Norfolk will represent the King at the enthronement of His Holiness Pope Pius XII on March 12, The American-owned Soochow recording to an official statement! University, founded by the Southern Issued this evening-Trans-Ocean. Methodist Mission in 1903, expects to receive from the Japanese to-morrow, possession of the Soochow property, property, including the university buildings

Since the hostilities, the University and campus which the Japanese have moved to Shanghai, where it is accupied for approximately 17 crowded into the Tse Shu building,

months.

THANKS KALOT:

ROSEBUD

Lady Clark Kerr In Kobe

Tokyo, Mar, F. Ludy Clark Kerr, wife of the British Ambassador to China, passed. through Kobe last night on her way to Chile, her native land,

Lady Clark Kerr, who arrived in Kobe from Shanghai aboard a Danish together with the remnants of the St. Hiner, said in a press interview that John's University at Hangchow, and her retura to Chile was not connect- A committee, including the acting the Shanghai University, all ofed with any special mission. She President, Dr. W. B. Nance, left for which had to evacuate their former refrained from touching on the China Soochow to resume possession of the sites-United Press,

problem.-Domci,

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