·990
-The bulk of the exports consists of Euro- pean goods and ought to have increased 37 per cent. to have kept pace with the depreciation of the dollar.
45.-The same cause is probably at work here as mentioned in our reference to the import trade from Europe, viz., the inability of con- sumers to pay the increased prices required by the fall in exchange.
47.-It may also be that Siam is now import. ing direct from Enrope to a greater extent than formerly:
Cochin China, Decrease $882,000-33 per cent. 48.-This appears to be the only country with which the trade of this Colony shews a decrease, and this is due, almost entirely, to the prohibi- tive tariff of differential duties applied since 1892.
49.-Reviewing the above trade statistics, our deductions therefrom bring us to the conclusion that the best interests of trade in this colony would be served by fixity of exchange, provided the value of the dollar is fixed at a suitable rate. 50. We believe that a dollar fixed at a gold value of 2/- would not hand.cap our export trade. We believe also that a dollar of this fixed value would considerably assist in main- taining, at somewhere near its present extent, our import trade, with gold standard countries in particular, whilst at the same time this fixity would give to the consumer the advantage that cost of living would not be further increased by the depreciation of silver.
51-A point which we think deserving of very grave consideration in this matter, is the protection which fixity of exchange would assure to the large amount of European capital already employed in the trade of these Settle. ments and the encouragement which it would offer to the introduction of fresh capital to the colony and also to the Federated Malay States. There is already much necessity for the restora- tion of that confidenco which should attach to investments in these parts.
52-We therefore give it as our opinion, that a fixed Sterling value of 2/- for the dollar would benefit the trade and general interests of this colony, and we suggest that the Committee of the Chamber of Commerce move to obtain fixity at that rate.
53-Oue object of our investigations has been to suggest, if possible, some meaus by which fixity of exchange can be attained. It will be apparent to every one that no reliance can be placed on silver as the basis of our currency. We are of opinion that a fictitious vulne to our silver currency, brought about by the contrac- tion thereof, is a course which certainly could not be maintained with safety or advantage.
54.—A gold standard being the only one which promises stability, we advocate the conversion of our present currency to a gold basis.
55-Having arrived at this conclusion we now proceed to suggest. for the consideration of the Chamber of Commerce, a scheme by which this change might be brought about.
Proposal
for a Gold Standard for the Straits Settlements. 56.-It must, we think, be recognized that it will be impossible to change our currency from Silver to Gold withont primary cost to the Government, although that eost. under the scheme which we are about to suggest, should be amply compensated for by subsequent advantages. As far as we are aware, in ro country has the change from a silver to a gold standard (and there have been many such changes within the past 20 years) been made without cost to the Government making the conversion. In our view, the burden involved by any conversion must necessarily be borne by Government as representing the whole com- manity, as any action towards demonetising existing currency, without due provision being made for withdrawing the coin so demonetized, would lead to disastrous results amongst the less enlightened classes of the population.
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THE HONGKONG WEEKLY PRESS AND although that might have been practicable in 1893, it will surely at the present time be admitted that the difference in parity betwee the rupee at about 1/4d, and the dollar in the vicinity of 1/10 is so enormons and would involve such a complete dislocation of trade as to render such a course extremely hazardous. In this connection it should be noted that, taking 1/4d. as the present value of the Indian rupee, to include the currency of this colony under that system would be equival ent to raising the dollar here to 3/-,-1/4d. bearing the same ratio to 2/ (the old par value of the rupee) as 3/- does to 4/61the old ralue. of the dollar).
par
[November 18, 1897.
of £152,000, which sum, at 2/- exchange, would involve an expenditure by the colony and Federated Malay States of $1,520,000; whereas if the Government had to provide the dollar equivalent of £152,000 at exchange 1/6, the cost would be $2,026,666, a loss, if the dollar should fall to that rate, of $506,666 annually.
JOHN ANDERSON,
G. S. MURRAY, AD. LASPE,
C. STRINGER.
APPENDICES,
$1
There follow a number of Appendices, A. to H. Applendix A gives a summary of Straits Settlements import and export trade with gold and silver standard countries (including Inter- Settlement trade from 1890 to 1896:" B.
66
58-As the result of enquiry made by us early in September, we have been informed that 16,000,000 British dollars had already been coined at the Bombay mint, and from the large Straits Settlements import and export trade amount of silver then and now waiting coinage with gold standard countries (excluding Inter- at Bombay into British dollars, the amount is
Settlement Trade). 1896 compared with 1890; likely very soon to exceed $20,000,000. Wo do C is a similar comparison with silver standard not suggest that the Government should con-
countries; D, the Course of prices and rates, sider any sheme which would involve the colony 1890-1896; E. Comparison of values (in taking over these $20 millions on a basis of 2- dollars and sterling) of Straits Settlements pro- per dollar, as a large portion of the coin is not dnce exported to United Kingdom, Continent in the colony nor in the Federated Malay of Europe and America 1890-1895," F. "Review States. We do not suppose there are more of the market, from 1890 to 1896, for the chief than $10-12,000,000 of all varieties of dollar
articles of export from the Straits Settlements; coins in circulation at the present time though- G.Principal Imports from Netherlands India, out the colony and Federated Malay States. 1890-1896; H, Schedule of monthly wage We recommend the adoption of the English (food and lodging provided free) of Chinese sovereign as the basis of our Currency with a
Immigrants-coolies, artizans, &e., from 1890 Straits dollar-fixed at the value of 2-sub-to 1897 (as per Contract Register in Chinese sidiary to it. The present subsidiary silver Protectorate). coinage to remain us it is.
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CO., LIMITED.
The following is the report for the twelfth annual general inecting to be held at the offices of the company, Shanghai, on the 24th Novem-
ber
59. The procedure of the Government would THE PERAK SUGAR CULTIVATION be not to let its'intention be known, and when a decision is arrived at, to pass a law at one sitting of the Legislative Council, and immediately thereafter issue a notification to the effect that. daring a term sufficiently brief to prevent importation, all dollar coins then legally current in the colony would be received at certain
The report now presented to the shareholders specified places and Government currency notes
covers a period of only eight months; the reason given in exchange; and that, after the expiry of such term, the British, Mexican, and other for so short a season lies in the three months' dollars in circulation would be demonetised.extension which was required to work off the The Federated Malay States would have previous crop under circumstances which were simultaneously to promulgate the same law. The explained in the last report presented; with the recently passed Currency Note Ordinance interpolation of this short season matters return to normal conditions as regards cropping periods. would have to be amended in the direction of relieving the Government. for the period of
notes.
three or four months, of the obligation of paying coin in exchange for its notes, and during that time the Government would have to raise a temporary sterling leau in London and import a gold reserve in sovereigns. The posi- tion of Bank notes would not be affected, except that the law must provide temporarily for the Banks holding Government notes as a reserve against their own notes, and paying Government notes against their own No current debts would be affected by the transition, they being made payable in the new currency, at the fixed rate of $10 to the £. With the large stock of silver that would come into the Government's hauds, a limited number of Straits subsidiary dollars could be coined, and these could conveniently be only 60 per ceut. to 75 per cent. of the weight of the pre- sent dollars. The Government would have to submit to a loss in disposing of the balance. Before making change in the currency, the Government, to protect themselves against possible further depreciation of the metal, might contract to sell silver for forward de- livery, and subsequently cover such sale with the demonetised dollars as these are received and converted into bullion.
60.—Our view is, that if judiciously managed, the conversion to a Gold Standard, on lines as indicated above, could be effected without greater cost to Government than they would be compensated for within a short period of years. As an instance of such compensation, let us assume that there may be a further serious 57. The opinion of the members of the Straits decline in the value of the dollar, say to 1/6d. Currency Commission of 1893 was divided into In 1896 the Government remittances for this those who wished for a dollar following the for- colony for Home Charges," at the higher tunes of silver and those who advocated the rates of exchange then ruling, amounted in round figures to £88,000: lef it be taken that colony being included in the Indian currency system. We believe it will be admitted from a exchange compensation for 1898 wil, with the perusal of this report that a dollar following dollar at 2, be about £14,000 to this should the fortunes of silver is detrimental to the be added, for account of the Federated Malay the further rough estimate of general interests of this colony; whilst as to States, the suggestion that the currency of the £30,000 for Home Charges and Exchange colony should be joined to that of India,' Compensation." These give a total (estimate?)
Crop. The area cropped has been 9473 or- longs, which has produced piculs 27,883.42 of sugar, or an average production of piculs 29.4 per orlong; the canes cat in the early part of the season returned a very low yield owing to the damage done in 1896, and it was not until May that anything like a normal yield was ar- rived at. The qualities of sugar made have been in the proportion of 744 No. 1 to 25 No. 2; the net price realised has been $3.60 per picul.
Plant and Machinery. The repairs and addi- tious to the factory referred to in the last report have all been completed, and the manager reports that everything is in first-class order.
Labour.-Mutters in this connection "have very materially improved under the new manage. ment, and a full supply of coolies has been maintained without difficulty throughout the
season.
Estate Extension.-The total area now opened is 1,703.75 orlongs (say 2,272 acres), of which 1,360.25 orlongs are in the Company's hands. the remainder being leased to Chinese.
area
cane
Water Supply. The work of connecting the estate with the Karau River has been completed, and the further extension of the canal in order to supply fresh water to the factory and coolie lines, is being pushed on as rapidly as possible; the completion of this work will bring great benefit to the estate.
New Crop-The
under
for now commenced is 1,248.50 or- the season
planted longs, of which 228 orlongs are by
this represents the largest crop with which the Company has yet had to deal, but there should be no difficulty in dealing with it within the twelve months; the Estate has been favoured with a satisfactory rainfall throughout the year, and the prospects for the season are very favourable. The whole of the new season'a sngar has been sold at an average price of about $5.85 per picnl.
Chinese:
Accounts.-The accounts submitted for the eight months show a profit on working account of Tls. 20,402.46, which is transferred to profit and
that account, loss account, the debit balance
=
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