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The Minister in China (Schurman) to the Secretary of State

230. Acting Minister of Finance yesterday summoned Reorganization Loan bankers to enlist their support in raising $7,000,000 to meet various items of expenditure which fall due Dragon Festival May 31st. He proposed issue treasury bonds secured on salt surplus. They told him salt surplus was reserved for other security by Presidential mandate of January last. Aforesaid bankers and their ministers still considering matter.

Correspondence published 21st between Chinese Bankers Association and Inspector General Customs shows Government is using customs revenues for new expenditures while customs surplus was already pledged to bankers as security for loan.

Schurman