JyatiiH &utib- sL"";
18
THE CURRENCY QUESTION.
THE HONGKONG WEEKLY PRESS AND
(Paily Press, 6th January.) The necessity for taking some decisive step to avoid the evils brought about by the continuously falling price of silver is daily becoming more pressing in the Far East; and warned by their late experience, we find that, of the few remaining countries that have up to tis retained their silver standard, Sam and the Philippines have already made the necessary prepara, tions for the introduction of gold. The Straits Settlements are seriously contein- plating a similar step. Chius therefore remains as the only commercial state in the world still adhering to a disparaged standard. Now the disease under which silver labours is chronic, and proceeds from natural causes inherent in the nature of the metal, or rather he process of its extraction. At one time almost te whole of the silver used in the world was extracted from ores containing a considerable per- centage of the metal, and till a few years ago it was generally expected that when the price of sily r bad dropped so lov as to forbid the working of these ores at a profit a term would be placed on the continual fall in the metal. The uses to which silver can be put as a precious metal are strictly limited, and have hardly increased in the same ratio as the decrease in is demand owing to the discredit cast upon it as a circulating medium. As an useful metal silver has not yet sufficiently fallen in price to permit of its coming into any seriously enhanced demand, so that the market must be looked upon as in an especially dangerous condition, with every indication of further depression till a balance can be arrived at, and silver be produced at a profitable price to the pockets of its employer.
From an entirely different cause, or rather series of causes, silver finds itself forced on the market in quantities out of all proportion to the natural demand These causes are partly of natural, but largely of artificial growth. Few metallic ores are raised that do not contain an appreciable quantity of silver, and the extraction of the metal from those ores has largely increased, owing to improved methods which have considerably reduced the cost of the process. It has thus become a sort of by-product in the reduction of other ores, especially lead and copper. The silver thus obtained must be placed on the market independent of pric, nor cau its production be controlled by the ordinary Laws of supply and demand, the amount of silver sold being passed directly to the credit of the working account of the other metals. Even greater than this is the depressing effect produced by the conduct of China. Utterly ignorant of the political and economical motives swaying the more advanced nations, China foolishly made war on the whole world. In former days such a course could have had but one eflect – China must have been wholly successful, or have ceased to exist as a nation. As a matter of fact China was ignominiously beaten from the very beginuing of her ill-starred attempt. She had calculated on the jealousy of the nations giving her a free hand, and thought she would be permitted to carry out her object in detail. The resuit proved that, so far from being able to defeat the whole world, she was utterly unable to cope with any one of the inore important Powers singly. She was saved from extinction by the patriotism of her to viceroys who fortunately had control of the basin of the Yangtsze, and the desire of the inore advanced nations to give her another trial. As a punishment for her truculence
-
រ
in having slaughtered in cold blood some bundreds of innocent victims, and having attempted the murder of the Ministers of the Powers at her Court she was not per mitted to go sent free. China in this could not plead ignorance. In her own palmy days she had recognised the sacred character (f guests aud euvoys, and had herself by en careful when the insult was offered to her self to inflict summary punishment ou the offending nation; and the justice meted out to her was but in accordance with her own · principles of statecraft. Instead of suffering the punishment in person, she was, however, let off with pecuniary indemnities. These penalties required her to pay a sum of some five millious sterling per annum, a suffi- ciently light infliction had she only set about payment in a statesmanlike manner. Here, however, she failed, and the methods she has been adopting have only increased her troubles. Instead of throwing open her trade and endeavouring to meet her charges by opening her markets and encouraging her export trade, which would while meet- ing her own engagements have directly advantaged her people, she has hamp red. in every way
her trede, with the natural consequence that she has been compelled to meet the whole by the direct export of her own circulating medium, and as she has contrary to the more politic course taken by her neighbours persisted in maintaining her own discredited silver currency, she has been throwing on the foreign markets already overstocked amount of that metal which, in addition to the oti.er depressing influences at work, has made it an actual drug in the markets of the world.
an
[
(January 12, 1903. development, is the throwing open of mines, more especially of the gold mines of the Empire. The whole of the great northern range of China, from at least the longitude of Peking eastwards to the Corean frontier, is known to be rich in deposits of this metal, now so urgently needed. By stealth, a considerable amount of gold is raised and exported yearly, and this doubtless has been tending to ease the situation; but even what gold extraction exists is doue in contumacy, and is, as far at the Chinese Government is concerned, in direct opposition to its present policy, which is quite prepared to strangle its own salvation in the cradle. These things are well known to all concerned; yet no one will come to the front and urge their being put in practice. On the contrary we have been stupidly trying palliatives that only aggravate the disease they pretend to cure. When will our statesmen see that something better, and more immediate in its action, than the ineffective attempts of treaty-making which we have lately wit nessed is needed in the present emergency?
(Daily Press, 10th January.)
The
If the currency question is to be satis- factorily solved, the simplest way is un- doubtedly to get China pl-ced on a gold standard. The ills that afflict China and the trade with China are largely traceable to the fluctuating silver currency. Chinese Government have not hitherto felt the pinch to so great an extent as to induce them to seek any remedy for the evil, but now that the indemnity due to the Foreign Powers has to be paid they are made to see how grievously a declining medium of exchange may press upon the nation wedded to its use. If the Mainichi Shimbun is. correctly informed, Count LAMSDORFF, the Russ an Foreign Secretary, has been giving good advice to the Chinese Minister at St. Petersburg. He not only pressed home the advisability of China adopting a gold standard, but insisted that no alternative was possible if China is to be delivered from the financial difficulties under which she is suffering. He was also kind enough to intimate that Russia was prepared to assist China with the necessary capital by issuing gold bonds. Whether it is practicable for China to adopt a gold standard we are not now prepared to argue. She has no gold to constitute a reserve, and if she purchased it in the manner suggested she would have Neither are we to pay a high price for it. prepared to dogmatise much as to what is If she possessed the energy of the Western States and was administered by enterprising and clean-handed officials it is possible that a silver currency would work for her benefit as a producer, as the enjoy ment of cheap labour and boundless stores of raw material would enable her to compete in the world's markets for most kinds of products and many staple manufactures to great advantage. But as her ruling class ale all tarred so heavily with corruption that it has become ingrained, it is to be feared that the possession of natural resources and cheap labour are advantages thrown away on China.
best for her.
This is the present condition of affairs; and as China seems unable herself to grasp the situation, the time is approaching, if it have not already come, when she must be saved from the consequences of her own folly. We are not here dealing with an independent nation; China has by her receût conduct lost all right to be considered in the matter. It is only right and reasonable to recall the fact that she has forfeited her claim to be treated as a nation at all; as a fact she only owes what measure of independence has been left to her to the sufferance of the civilised Powers; and in the interests of herself, as of the world, the time has arrived when she must reform her currency, or have it reformed for her, and what the Powers have to consider is, not what is agrecable to China, but what has become a necessity for her further existence. It is, plain that the present position of affairs cannot last; there are too many foreign in crests and too much foreign property at stake to permit China to play ducks and drakes, even with her own money. She is in the position of a spendthrift bankrupt who has to be restrained from spending any more of his patrimony, not less in his own interests than in those of his creditors, and one of the first and most immediate needs of the situation is such a reform in her currency as shall prevent the necessity of the export of silver to an already over- stocked market. For the attainment of Whether or not China yields to the this end, one or two measures are of the voice of the charmer and embraces gold first, and most immediate necessity. One as her standard, she has at any rate of these, we have pointed out, is the substitnablemnly covenanted to create a national tion of a currency more in accordance with coinage. This is provided for by Article the practice of the rest of the world than LL of the Commercial Treaty with Great the present discredited use of silver, now Britain, negotiated by Sir JAMES MACKAY, from causes beyond the control of China which reads as follows: China agrees continually falling in value; the other also to take the necessary steps to provide for in the power of China still is to remove the
a uniforın national coinage, which should present drawbacks that binder the expan-
be legal tender in payment of all duties, sion of trade Following quickly upon
taxes, and other obligations through- these, but requiring more time for its out the Empire by British as well as
!
|
7
No comments yet.
Private notes are available after approval.