Mr. Dudley to Mr.
Hay.
Legation of the United States,
Lima, Peru, June 3,
1902.
No. 611.]
Sir: Referring to Mr. Neill’s No. 564, of the
18th of January last, I have the honor to transmit herewith two copies
and a translation of a resolution of the ministry of finance under which
the second 500,000 soles authorized by the law of December 14, 1901, to
be converted into bar silver for export in the purchase of pounds
sterling are now being melted at the Lima mint. The purpose of these
measures, as has been heretofore reported, is to maintain the silver
sole at its coinage value of 24 pence, corresponding to an equivalency
of 10 soles to the pound.
I have, etc.,
[Inclosure.—Translation.]
Demonetization of silver coins.
The following resolution has been issued by the finance
department:
Lima, May
17, 1902.
In view of the petition No. 39 in which the Lima bankers, merchants,
and agriculturists request another smelting of silver soles; in
virtue of the verbal offer of the banks, and the decision taken by
the council of ministers, it is resolved:
- First. That 500,000 (entire) silver soles shall be
demonetized.
- Second. The Italian, International, and Popular banks
shall deliver to the Peru and London Bank the amount of
silver soles it will suit them to contribute toward the said
smelting, and the Peru and London Bank shall add from its
own funds the necessary amount to complete the sum of
500,000 soles.
- The Bank of Peru and London shall deliver to the national
mint the said sum of 500,000 silver soles, there to be
converted into ingots.
- Fourth. The said bars shall be remitted by the Bank of
Peru and London to its London agents, to be sold by them for
the account of the Government, at the best price obtainable,
free of all commission except the half per cent customary in
this class of transactions.
- Fifth. On the bars being sold the agents of the Bank of
Peru and London shall remit to its Lima office the product
of the said sale in pounds sterling, and immediately on the
arrival of the said remittance at Lima the Bank of Peru and
London shall place the same at the disposal of the supreme
Government.
- The proportion contributed by each bank for the
demonetization will be paid by the Government as it desires,
either in pounds sterling, at 10 soles for each pound, or in
whole silver soles.
- Sixth. The London agents of the Bank of Peru and London
shall, immediately on effecting the sale of the ingots,
telegraph to the Lima office the net product obtained, and
as soon as the loss incurred be ascertained the Government
will order the reimbursement of the said loss to the Bank of
Peru and London by the National Revenue Collection
Company.
- Seventh. This payment shall be made by quarterly
installments of 30,000 soles, or £3,000, at the election of
the Government, and shall be charged to the account of the
profits shown by the National Revenue Collection Company’s
quarterly balance sheet in favor of the Government; the
first installment to be paid on May 31, 1903.
- Eighth. The amount paid by the National Revenue Collection
Company to the Bank of Peru and London on loss account shall
earn 8 per cent interest per annum, to begin on the 13th of
the present month of May, and shall continue until the total
extinction of the debt.
- Ninth. The part of the 500,000 soles refunded by the
Government to the banks, respectively, in pounds sterling—or
be it the product resulting from the sale in London of the
said 500,000 soles, reduced to ingots—shall earn no
interest.
- Tenth. The Peru and London Bank shall undertake to pay to
the other banks both the proportion of gold resulting from
the sale which to each of them may be due, as also of the
amounts received from the National Revenue Collection
Company, without receiving any commission whatever.
- Eleventh. Let the respective expenditure items that will
be incurred by this resolution appear in the budget project
for the year 1903.
Let this be registered, notice of the same be given to the banks, and
their acceptance of the same be expressed; let this be made known,
published, and deposited in the archives.
[Rubric of His Excellency.]
