The initial measures adopted by China to defend her currency and prevent a-drain of silver were made effective as from October 15, 1934 Jand, as they stil remain in force, may bbe reeapitutated here. They were as 'The levy of an export duty on dollars ahd Central Mint bare the! rate of 10 per cent. less 214 Per cent for minting charges, making net levy of TH por cent. ad valorem and the avy' ofan export duty ther forms of sliver at the Tale 10 per cent. ad valorem.
(ly The collection, In addition to the aport duty. of" an cqualtzation charge equivalent to the deficiency, fang, existing between the theoretical pati of the price of silver In London. Bnd a rate of exchange officially fixed by. the Central Bank (of China at Shanghat after making due allowance forthe payment of export duty.
That these measures proved justl~ fable is shown by a comparison of the figures for the value of silver shipments abroad in 1994 and during the year under review: the net value fof silver exported during 1935 being. St. $894 million only as compared with St. "$2567 million in 1994, Circumstantial evidence was not lacking of continued smuggling, especially from North Chino, but this ad declined at the close of the year owing mainly to the fall in the world price of silver. A further effect of the Festrietions Imposed by the Chinese Government on the export of silver was to steady the Chinese dollar o13~ fa-pis the current world market price. of silver, The relative merits and demerits of high and low silver ex: changes have been the subject of touch controversy: the baneful effects, however, of fluctuating exchanges on trade cannot be denied. The dangers of a continuation of the deflation from which China was suffering, due to the loss of the three Manchurian provinees, the reduced purchasing power of other nations, and the i creasing value of China's silver cur-Feney. engaged the serious attention of the Government, which early adopted measures to counter the situation." Among these were the organization by the Ministry of Fie Rance of a Monetary Advisory Committee charged with attending to all matters relating to improvement of the currency situation, stabilization of foreign exchanges, and the improvement of China's balance of international payments. One of the frst actions of the Committee was to recommend that future silver Import of minimum quantity of $00,000 ounces should be admitted with provisions for re-export free of any charges above the original 2% per cent. export tariff, standard silver dollars and Central Mint bars being exempted from this last charge also when re-exported under the procedure adonted. In March the capital Centeal Bonk of China was consid ably ausmened, while the Government's shore in the capital of the Bank of China and the Bank of Come munications was algo increased the bringing the two leading Chinese banks into a community of interest with the Central Bank. Loans wet made to business, industrial.
Bonking institutions in temporary dimeulties, and much generally was tone to prevent a threatened collapse fu the Ananeial stability of the com= munity. The foreign banks in Shanghai assisted. moreover, by the adoption of a "sentleman's anreement not to export sliver by way of Drbltrage, transactions. On October So—China's national hatlday—the Miniter of Finance. Dr. H. ¥. Kung, Isated a review of financial bailey.
Tt was ree~snized that the measures adopted to date were In the nature fof temporary palliatives only. and Uncertainty rersrding the ultimate policy of the Government tnooards the dwindling currency reserves of the country remained unfit the nram= gation on November 2. 1035 of the Aeereesvenending silver as a cirenlatinn meaiuim and makino notes the three Governmen thanks. the tinty Tegal tender in payment of all debts,
Text read from the printed page and cleaned; old type leaves the occasional error.