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many of which are controlled by the Central or Provincial Government authorities, have included the extension of credit at low interest rates to agriculture and industries, the financing of communication enterprises, the investment in mining and other productive developments and finally the promotion of thrift and savings among the local people.

The progress which has been made so far in finance and banking would have been impossible had it not been for the public confidence in our National Currency. In November, 1935, China abandoned the silver standard, centralized her note issue, and placed her dollar on an exchange basis of 29-1/2 American Cents and 14-1/2 Pence Sterling. The currency reform met with the unanimous approval of the whole country, and by providing foreign exchange for legitimate requirements and by removing obstacles to the free transfer of domestic funds, the Government has been able to maintain the unswerving confidence of the public in our dollar, in spite of the great decline in its open market exchange rates during the past two years.

In these days of managed economy and interwoven commercial and financial relations between nations, the stability of any currency does not and actually cannot depend upon its specie reserve alone. The true determining factors are to my mind the balances of trade and of payments; and what should at times be regarded as the controlling influence is the public's confidence in the currency. It may be safely said that the confidence of the Chinese in the future of their currency is as great today as before the war; this confidence is shared by many foreign interests which have large investments in China. The balance of trade is, I believe, definitely against us, but our balance of payments seems to have been kept in better equilibrium. An important item affecting our balance of payments is the remittance of funds to China by the oversea Chinese. Exact figures are not available, but the oversea Chinese are probably sending back to China the