Mr. Beaupré to Mr. Hay.
Bogotá, October 30, 1903.
Sir; I have the honor to report that one of the most important measures presented for the consideration of the present extraordinary [Page 131] session of the Colombian Congress cassed during the last week and has been signed by the President. It is with regard to the free stipulation in currency (libre estipidación), under the title of “for the regulation of the monetary system and the redemption of the paper money.”
This law has not been published in the Diario Oficial, so that I am unable to furnish a complete copy and translation in time for the next mail, but its principal features are as follows:
The monetary unit of the country to be the gold dollar of 1,672 milligrams of weight and.900 fine, to wit, the gold dollar of the United States of America.
The gold coinage of other nations may circulate freely, as well as silver coins .835 and .900 fine.
Future emission of paper money, whether by central or departmental governments, absolutely prohibited.
The paper money heretofore legally emitted by the national and departmental governments to preserve its character of a forced currency and its liberatory power in those places where it now circulates according to the following rules:
- (a)
- In public or private transactions contracts may be made at the will of the parties either in the gold unit or in paper money.
- (b)
- When payment has been contracted for in gold, the obligation can be carried out by the payment of an equivalent sum of paper money at the rate of exchange ruling on the day of payment.
- (c)
- In the departments and provinces where silver has hitherto been current that coinage shall keep its character of circulating medium, in relation to the gold unit, according to the price of silver in the market, and contracts may be made in that currency.
- (d)
- Obligations contracted, or which may be contracted, with foreign houses or interests, shall be carried out in accordance with the terms of article 203 of the commercial code.
- (e)
- Obligations contracted in legal tender (moneda corriente) in which a particular coinage is not expressed will be understood as contracted for and payable in the forced paper currency.
A council to be created, known as the council of national amortization, to be composed of five members, two nominated by the senate, two by the chamber of representatives, and one by the executive power. They are to be chosen from the most distinguished members of commerce, known for their rectitude and competency.
- (a)
- The gold which the council collects to be sold in lots of $1,000 at public auction for paper money.
- (b)
- The paper money which the council shall collect by the abovementioned sales and by contribution to be publicly burned.
- (c)
- The council shall have the full management of the funds confided to it and of its own constitution.
- (d)
- The council to fix, day by day, the rate of exchange, based upon the actual transactions in the open market, and that rate will hold good in all judicial matters. The council to appoint sectional councils in the country for the changing of deteriorated bills, buying up paper money, and burning the same.
The following sources of income to be at the disposal of the council for the amortization of the paper money: The rent from the emerald mines of Muzo and Cosquez; from the mines of Santa Ana, LaManta, Supia, and Marmato; from the pearl fisheries of the Republic; from the produce of the exploitations of the national forests; harbor and light-house dues, tonnage, etc. The product coming from the export [Page 132] duties to include those on vegetable ivory, which, it is proposed, shall be made the same as levied by the Republic of Ecuador. The council authorized to rent the Muzo and Cosquez mines for the period of ten years. Estimates of income and expenditure to be fixed in the gold unit heretofore mentioned (the United States dollar).
- (a)
- Customs duties to be levied in gold, or in bills at the exchange of the day.
- (b)
- The rents of national property, such as the mines of Muzo, etc., to be levied exclusively in gold.
- (c)
- Rents not mentioned above to be fixed in gold, but levied in paper, in periods of three months.
- (d)
- For the fixing of exchange, in the periods of three months, the figure of the national council of amortization will be taken, but for the first three months liquidations will be made at 10,000 per cent.
The personnel of the national council to be reappointed every four vears, but the members appointed this year to hold office until September 30, 1908.
The national council to cause a new edition of bills to be printed, to be exchanged for those deteriorated. For this purpose they may appropriate the sum of $250,000 gold, to be taken from the funds they shall receive for the purposes of amortization.
I am, etc.,