The question now was, how to retire the old silver and copper coins that were then circulating. The total output of silver dollars from the provincial mints was estimated at $40,000,000 and the number of fractional silver coins, practically all 10 and 20 cents, was estimated at 1,400,000,000; to retire them by exchange would cost at least 20,000,000 new dollars to cover losses in exchange, cost of transport, refining, touch and loss of interest. The Government was naturally both unable and unwilling to lose; so it proposed that the old silver coins, including subsidiary coins, should circulate for a time at their market value, along with the new coins. The process of redemption was to be gradual and at market rates; and when sufficient numbers of the new coins had been issued, the circulation of the old ones was to be stopped and they were to be exchanged for the new coins on the basis of the bullion value.
Even more difficult than the problem of silver coins was that of the copper issues, which in 1910 were estimated to be worth Tls. 100,000,000. After considering several plans, the Government decided to permit the circulation of the existing copper coins for a time, especially while the new coins were being introduced. The provincial authorities were ordered to inform the public that the old coins were to be legal tender to the amount of 3 yuan from the date the new ones were issued, and that in the second year the legal tender amount was to be limited to 1 yuan. At the same time measures were to be taken to redeem the coins and to remint the requisite number of 2 cents and 5 mill coins. Also the best 10-cash pieces should be selected to serve the purpose of the 1-cent pieces under the new currency law. It was decided that at a subsequent and suitable time the Government should proclaim that the old subsidiary copper coins were no longer to be allowed to circulate.
All these regulations left out of account the store of about 100,000,000 foreign dollars in the hands of the Chinese people. The Government did not pay sufficient attention to the means by which coins were to be put into circulation in the country, and the regulations with regard to the bank of issue and convertible bank notes in connection with this scheme were, to say the least, unsatisfactory. I will refer to this question when I discuss banking. In the meanwhile, before concluding the section on efforts of the Chinese Government to reform currency, I have to make brief reference to the currency loan of £10,000,000 signed in April 1911 and the scheme of Dr. Vissering who was appointed monetary advisor to the Chinese Government under the conditions of this loan. In passing, it is as well to know that owing to the Revolution which followed soon after, the loan was not floated and Dr. Vissering's scheme has, so far, not been adopted by the Government.