DECREE OF 22ND DECEMBER, 1903.

The attention of the Council has been specially called to the following Decree, promulgated on the 22nd Decem

That in accordance with the Decree No. 595 of 9th June, 1899, it was resolved for the public benefit to render the banknotes and those of the Bankers' Committee equivalent to national silver coin ;

That, notwithstanding the clearness of that order, it has not been rightly and faithfully interpreted, doubts and perplexities, which it is necessary to bring to an end, having frequently occurred, principally with regard to the liquidation effected by the Tribunals when the payment in gold of any obligation is being judicially exacted; Therefore :

Making use of the full powers with which I am invested by the National Legislative Assembly;

I DECREE:

ARTICLE 1. When the payment of any sum in gold is judicially ordered, the debtors may cancel their credits in silver money or in the notes of the Banks, or of the Banking Committee, in accordance with the above cited Decree, and at the existing rate of exchange between silver and gold.

ARTICLE 2. The rate of exchange will be fixed either by experts or by the current quotations of the banks.

ARTICLE 3. This Decree will come into force on the day of its publication.

Given in the Palace of the Executive Power in Guatemala, on the 22nd December, 1903.

The Council have been unable to obtain any official information as to the exact purport of this Decree, which, at first sight, would certainly appear to imply that a creditor suing for payment of a gold debt is liable, on obtaining judgment in his favour, to receive but a small proportion of the amount actually due.

Even if the effect of the Decree is not really of as confiscatory a nature as that indicated above, the wording of it is certainly very unfortunate, and without satisfactory explanation it can only act as a deterrent to the investment of foreign capital in Guatemala.

The Board of Trade Journal of 17th March, 1904, contained the following remarks on the subject:

It will be observed that, according to this, gold debts may be paid in silver or notes at the rate of exchange for silver, although the notes are only worth, it is reported, about 1d. in the shilling.

In his despatch to the Foreign Office on the subject, H.M. Minister reports that, in reply to the representation made by the doyen of the diplomatic corps to the Government, it was explained that the Decree did not touch bonâ fide contracts made in gold, and that payment of gold debts under a judicial decision would have to be made in paper at the current exchange of the day, but up to the time of writing (2nd February) no definite official explanation had appeared.

NORTHERN RAILWAY.

On the 11th April last the Congress of Guatemala approved a Contract made between the Government and Mr. Minor C. Keith and Sir W. Van Horne for the completion of the Northern Railway. Under this Contract the portion of the line already constructed from Puerto Barrios to El Rancho is to be transferred, with all rolling stock, etc., to the contractors, they undertaking to build the section from El Rancho to Guatemala City within three and a half years. The whole line, when completed, is to be worked by the contractors, and to be the absolute property of them or their assignees, subject only to the right of the Government to purchase it for its full value at the end of ninety-nine years. During a period of fifteen years from the date of the completion of the line to Guatemala City, the Government is to make good any

possible difference between the nett receipts and interest at 5 per cent. on Bonds to the value of $4,000,000 United States gold, which are to be issued by the contractors to defray the cost of construction. The Contract also contains clauses fixing the scale of freights and fares to be charged, and provides for a free right of way and the exemption of materials from import duties, for certain foreshore rights at Puerto Barrios, and grants of land there and elsewhere, for freedom from all taxation, and for arbitration in case of differences.

BUDGET FOR 1903-4.

The Budget for the year 1903-4 was promulgated on the 30th April, 1903. The details of the Estimates were as follows:

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No information can be obtained concerning the Estimates of Revenue for the financial year 1904-5, but on the 26th April, 1904, a Decree was promulgated fixing the estimated Expenditure at a total of $17,951,429, which comprised the following items:

The probability of these Estimates being strictly adhered to would, however, appear to be small, as the above-mentioned Decree expressly authorises the Executive Power to introduce into them such modifications as the public service may require.

TRADE STATISTICS, 1903.

The Report of the Director-General of Customs contains no details regarding the value of the individual articles imported in 1903, it being merely stated that the total value of the Imports amounted to $2.971,638 gold. As regards the value of Exports during the same year, the Report contains a Table, of which the following is a summary :-

As compared with 1902, the value of Exports declined by $2,312,521.72 gold.

In his Message to Congress the President stated that in 1896 and 1897 Imports had exceeded Exports, but that in the years 1898 to 1903 inclusive the excess of Exports over Imports had amounted to $20,932,515.66 gold.

EXCHANGE.

In the subjoined Table, which has been kindly furnished to the Council by Messrs. Chalmers, Guthrie & Co.