In the early part of the present year the rate fell as low as 133. Since then it has risen, and at the end of July stood at 144 per cent.

SANTO DOMINGO.

*Obligations Or de Saint Domingue Two and

Three-quarters per Cent. (Brussels issue)... £2,736,750

Hon. Sir C. W. Fremantle, K.C.B. V. Watney, Esq.

The interest on these Loans went into default on 1st April, 1899. On the 4th November, 1901, the Coupon due 1st October, 1901, was paid at the rate of fr. 4, and in February, 1903, the Coupon due April, 1902, at fr. 3.85 per £20 Bond to holders accepting the settlement negotiated by the French and Belgian Committees (see History of the Debt below). The Council are not aware of the amount of Bonds upon which this payment was made.

The authorised issue was £1,500,000, of which amount it is stated that £351,400 has been cancelled. It is also understood that there are outstanding about £300,000 "FrenchAmerican Reclamation Consols," which have not been presented for exchange into Scrip of the 4 per cent. Unified Loan.

HISTORY OF THE DEBT (FOREIGN).

1869.-Six per Cent. Loan for £757,700. The Government of Santo Domingo entered into a contract with Mr. E. H. Hartmont, by which the latter agreed to provide a sum of £420,000 for the construction of roads and railways, of which £100,000 was to be retained by him as compensation, the nominal amount of the Loan to be fixed by the contractor. The Government on their part undertook to pay, for the service of the interest and Sinking Fund, an annuity of £58,900 in half-yearly instalments for twenty-five years, or a total of £1,472,500. Messrs. Peter Lawson & Co., acting for Mr. Hartmont, accordingly issued in London £757.700 in Bonds secured upon a first charge on the Customs Duties of the Ports of Santo Domingo and Puerto Plata, the Guano royalties, and the Revenues arising from the Forests and Mines of the Province of Samana. The Bonds were redeemable in twenty-five years by a 13 per cent. accumulative Sinking Fund. The issue price was 70 per cent., but at this price the Loan received little support from the public, and was subsequently disposed of, at rates ranging from 55 to 50 per cent., to Messrs. Bischoffsheim & Goldschmidt and others, by whom they were later disposed of to the public. The Government only acknowledges receipt of £38,000. Mr. Hartmont, however, asserted that he tendered personally to the Government £211,110, but that it was not accepted owing to negotiations for annexation in progress at that time with the United States. Interest on this Loan was paid for three years, but it was stated that these payments were made by the Contractor and not by the Government.

1872.-Default took place, and the Loan became in 1875 the subject of a Parliamentary enquiry.

1888.-Six per Cent. Loan for £770,000, for the Conversion of the 1869. Loan, for which £142,860 was reserved, and the consolidation of the Internal Debt, which required £151,660. The balance of £475.480 was offered for public subscription at 83 per cent. by the Capital and Counties Bank and by agencies on the Continent. The Bonds were secured by a first charge on the entire Revenues of the Republic, including a special charge

on the Customs Revenue, and were redeemable in thirty years by half-yearly Drawings. The terms for the Conversion of the 1869 Loan were £20 of the New Stock in exchange for £100 of the Old. Bonds to the nominal amount of £591,900 were exchanged by the Capital and Counties Bank. Bonds which had been drawn for redemption, but which had remained unpaid, as well as Bonds from which Coupons were missing, were excluded from the Conversion. The Council, at the time, addressed a remonstrance to the Government on this point, but without effect. (See below, 1897 and 1899.)

1890.- Six per Cent. Central Dominican Railway Loan.

Authorised Issue, £900,000. Of this amount £575,000 Bonds were offered for subscription on the Continent at 77 per cent. in November, 1890. Few Bonds, if any, are held in England. The objects of the Loan were to develop the internal resources of the country, to form a Reserve Fund, to extinguish the Internal Floating Debt, and to build a railway from Puerto Plata to Santiago. The Loan was guaranteed generally by the Government, and specially by (1) an annual subvention of £24,000 during fifty-six years; (2) the receipts on the first section of the line, and a mortgage on the second section and rolling stock.

1892.--Default took place on the External Loans of 1888 and 1890. 1893.—A new Four per Cent. Consolidated Gold Debt for £2,035,000 was created, to be applied to the Conversion of the Six per Cent. Loans of 1888 and 1890 (the outstanding amounts being £731,000 and £571,000 respectively), with arrears of interest amounting to 12 per cent, the whole to be converted at par. This, with expenses, absorbed £1,610,000 of the New Stock, and the balance, viz., £425,000, was to be applied to completing the construction of the first section of the Central Dominican Railway. The New Bonds were redeemable in sixty-six years, with an accumulative Sinking Fund of per cent. per annum, and the Loan was guaranteed by the whole of the Customs Duties of the Republic (less $93,000 per month to be retained by the Government for Administrative expenses), and by a first mortgage on the line and its Revenues and accessories. The collection of the Customs Dues was vested in a Régie, controlled by the San

Domingo Improvement Company of New York. By the terms of the Arrangement it was provided that should any suspension take place in the service of the Loan, a Financial Commission composed of representatives nominated by the Governments of Great Britain, the United States, France, Belgium, and Holland, was to be appointed forthwith to collect and distribute the above-mentioned Dues.

1895. Four per Cent. Loan denominated "French American Reclamation Consols." Authorised Issue, $4,250,000 (£850,000). Of this amount $1,000,000 (£200,000) was publicly issued in Paris by the Banque Nationale de St. Domingue at 302 francs per 515 franc Bond=5864 per cent. These Bonds were redeemable at par in 66 years by means of a Sinking Fund of per cent. The service was to be a first charge on the Budget, and was secured on certain port dues and import duties, any deficiency to be made up by the Government out of General Revenue. As in the case of the 1893 Loan, in the event of a default, an International Commission was to be appointed to collect and distribute the above-mentioned Revenues.

1897.-The Coupons due 1st January on the 1893 Bonds were not paid owing to the Régie not having received sufficient funds for the purpose.

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A new Arrangement was made during the year, under which the Bonds of 1893 and 1895 were converted into a New Unified Loan for £4,236,750, divided into £1,500,000 Four per Cent. Bonds and £2,736,750 Two and Threequarters per Cent. Bonds, apportioned as follows:£850,000 Four per Cent. Bonds to the Conversion at par the French-American Reclamation Consols, and £2,136,750 Two and Three-quarters per Cent. Bonds, to the Conversion of the 1893 Bonds, with interest in arrear up to October 1st, 1897, at par, the balance of the New issue to be applied to the Conversion of the foreign and domestic Floating Debts of the Republic and to the expenses of the operation. Both classes of Bonds to be secured by a first charge on the General Customs Duties of the Republic and the special revenues assigned to the various Debts included in the Arrangement. These revenues to be collected by the Régie under conditions similar to those