893.515/1062: Telegram
The Consul General at Shanghai (Gauss) to the Secretary of State
[Received May 18—10:30 a.m.]
270. The following appears in today’s press as a Kuomin release at Nanking, May 17th.
[Page 482]“Dr. H. H. Kung, Minister of Finance, issued the following statement today:
‘During the past 6½ months the Government has earnestly devoted its efforts to developing and strengthening the measures of monetary reform adopted November 3, 1935, which have resulted in the attainment of exchange stability at a level adopted (adapted?] to China’s economic life.
The Minister of Finance now announces that in the light of experience and of additional knowledge of monetary conditions obtaining in China and abroad, the Chinese Government deems it desirable to make known the following measures of monetary reform in accordance with the decree of November 3, 1935.
- (1).
- It will continue to be the policy of the Government at all times to maintain adequate reserves against note issue consisting of gold, foreign exchange, and silver, the silver portion of the reserves to have a value equivalent to at least 25 percent of the note circulation.
- (2).
- For the purpose of completing the reform of the Chinese coinage system, the Government will issue silver coins of 50 cents and 1 dollar denominations.
- (3).
- For the purpose of further strengthening the position of the Chinese currency, definite arrangements have been made to increase the gold and foreign exchange portion of the note issue reserve.
The Minister expresses the firm belief that these supplementary measures of monetary reform and the arrangement made will assure the continued maintenance of an independent currency system not linked to any foreign monetary unit and the permanent stability of the Chinese currency which will inevitably lead to greater economic improvement and prosperity of the Chinese people.’”
Repeated to Peiping, mail to Nanking.