158
A GOLD CURRENCY FOR JAPAN.
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THE HONGKONG WEEKLY PRESS AND.
foreign creditors could not object and whi would be a matter of domestic concern Presumably, however, the Japanese men responsible for the scheme put forward are satisfied that there is no prospect of a rise in the gold value of silver beyond the ratio they have fixed, and the change proposed will in itself have a tendency to prevent any rise, if not indeed to bring On the other hand, there about a fall. seems some reason to believe that the ap- preciation of gold has reached its maximum, or nearly so, and that the future fluctuations in the relative values of that metal and silver are likely to be confined within com- paratively narrow limits. If that should be so, not only is Japan not likely to experience any difficulty in the mani- pulation of her currency, but the change will have little to a gold standard effect upon her trade either for or against. Had she effected the change when the yen was worth three shillings she would have had to bear the same loss from the fifty per cent. appreciation of gold that other gold standard countries have had to bear, but it seems improbable that gold will continue to appreciate at the same remarkable rate that it has during the past twenty years.
The scheme for placing the currency of Japan on a gold basis has now been formu- lated, and that it will before very long be carried into effect we think there can be little doubt. The change is an undesirable one, but will be less disastrous in its effects on the development of Japan now than it would have been had it been made before the rapid appreciation of gold took place; and as the existing silver currency is to remain in circulation and continue unlimited legal tender there will be no sudden change in the general level of prices. The free coinage of silver, however, is to be stopped, and the conse- quently diminished demand for the white metal and the increased demand for gold will contribute to maintain the diver- gence in the relative values of the two metals. Though nominally of unlimited | legal tender the silver yen will become virtually a mere token coin, in the same way that the silver coins of the United States and France have become mere tokens. On this point a curious mistake has been made by the N. C. Daily News, which, after giving the scheme as set out in the Japan papers, says "This is called by the Japan "Mail Gold Monometallism,' but it is ob- viously not monometallism at all, but bime- "tallism with a fixed ratio. This is the "desire of the heart of all bimetallists, but "they do not want the ratio that Japan "proposes to adopt, 1 to 32." The use of the word "obviously in connection with such a glaring misstatement is rather amusing. What the bimetallists want is to have the mints open to gold and silver alike at a fixed ratio; whether the ratio should be 1 to 32 or 1 to 16 is a detail, but the bimetallic principle is that no restriction should be placed on the use of either metal as money. Japan, by clos- ing her mint to silver, shuts out that metal and demonetises it except in so far as it may be used as a token currency. Again, our Shanghai contemporary says:— "There is "another trouble that is inseparable from "the attempt to keep two metals circulating "at a fixed ratio in a country, while the "market value outside of each of them in terms of the other is continually fluctuat ing, and that is, that Gresham's Law comes "inevitably into operation. If silver falls " below the ratio of 1 to 32, Japan will lose "her gold; if it rises above that ratio, she "will lose her silver. It is proposed, indeed, "to stop the export of gold by putting a premium on it, as is done, when necessary, by the Bank of France, while the value of the silver is to be kept up, as in India, by stopping the coinage; but this is not gold monometallism." Gold monometallism it most decidedly. A fall in silver will not drain away gold from Japan except to the extent of the value of the silver yen at present in circulation outside Japan, and presumably it is for the purpose of redeeming those coins that a reserve of
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any further Government from 5 to 10 If our conte the facts of dealt with the matte argument, though prob
[March 8, 1897.
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have arrived at the conclusion. manifestly
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one route should be cha goods arriving by ano however, Great Britain,
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France and Russia, has already this dangerous principle. In the Russian Convention of 1862 for the regulation of the land trade it is provided that -“Russian “merchants transporting Russian – mer. "chandise shall on their arrival at Tientsin
pay import duty at the rate of one-t less than that specified in the general foreign tariff." In the French Convention of 1887 it is agreed that in order to develop the trade between China" and as rapidly as possible foreign goods imported into Yunnan and Kwangsi from Tonkin shall pay only 70 per cent. of the import duties collected by the Customs at the Coast Ports in China. Proceeding on the same lines, in the Burmah Convention of 1894, with a view to the development of trade between China and Burmah, the Chinese Government con
CHINA'S CUSTOMS TARIFFS FOR sents that for six years from the ratification
THE LAND AND SEA, TRADE.
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88
Some misapprehension appears to exist with regard to the so-called concession granted to the Russo-Chinese Railway Company to the effect that Chinese Customs dues for imports and exports carried across the Russian frontier shall be one-third lower than in the case of sea-borne goods. Instead of being something new this is merely a declaration of a previously exist- ing right. Our contemporary the Hong- kong Telegraph, however, apparently over- looking the treaty provisions already in force on the subject, says that "The "Russians are to be congratulated on "scoring a great diplomatic success in respect of the reduction of Customs dues on imports from and exports to Russia by the new railway, and it is a question "whether the thanks of all foreigners “interested in the trade with China are not due to the shrewd representa- tive of the Czar in Peking who, ever on the alert to strike when China "should be unable to refuse to consent to "his overtures, however unpleasant, has "thus obtained a great concession that may "be rendered beneficial to all nations, in view of the fact that the most favoured "nation' clauses of the treaties can, no "doubt, be made operative in the premises, "It would be manifestly unfair, and opposed "to the spirit of the favoured nation' "clauses of the treaties, to admit Russian "goods one-third lower than sea-borne "goods and levy the usual dues on all "sea-borne goods at the same time, for were this done the Russians, and Chinese " trading under Russian auspices, could "under-cut all who failed to use the railway.
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of the Convention the duties levied on goods imported into China by the Burmah route shall be those specified in the general tariff of the Maritime Customs diminished by three-tenths. There are cor- responding provisions with respect to the export trade, only there the reduction is still greater. Great Britain haying thus ac- cepted a special concession to herself in the way of a remission of duty on merchandise conveyed by a particular route is not in a position to oppose the continuance of con- nature e previously cessions of the same granted to other Powers.
The concessions referred to, however, were granted when railways were still in what appeared to be the distant future. Now we have railways reaching out their arms towards China from the North and the South. Whether a difference of one-third in the Customs dues chargeable on goods will have any material influence in direct. ing the present sea-borne trade of the Treaty Ports to the railways when they are completed may be doubtful, but in the competition of rival routes every cent in the must tell to come extent. way of charges If it be found that a large volume of trade is developed by the railways China in the interests of her own revenue would naturally desire an equalization of the duties and would have a good case for opening negotiations to that effect with the Powers concerned, representing that under the changed conditions the special agreeme have ceased to be equitable, they having been arrived at when land carriage was slow and costly and the trade unable to bear the same duties as sea-borne trade. Under the present circumstances, however, it is hardly.
invoke the favoured Open toy not to Great Britain,
Wha
the Burmah Convention. done, perhaps, is to reduction of duty on good West River route, shortly the French are allowed t China by the Red River thirty per cent, on the general
Maritime Customs, why
the trade of all m
$100,000,000 in gold is to be held available
We trust to learn in due course when the operation is undertaken. When "that Sir CLAUDE MACDONALD has not those coins, or so many of them as may be been slow to take every advantage of the available, have returned to Japan, a fall in "opening' which such great concessions,
Iver will
no more cause a drain of gold assuming the reports to be true, to Russia from that country than it causes a drain of unquestionably entails. One thing gold from England. On the other hand, if "is clear and it is that if Russia has silver were to rise Japan might experience" obtained the right to import and export some tempora inconvenience through the" by the Manchurian railway on payment of value of her token coins being too "one-third less duty than is payable at the that could be easily and speedilyChinese Custom-houses on goods imported striking new tokens of a lower" and exported by steamers, then the value, an operation to which her British Minister should decline to discuss it see
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