Note 13 — Its Early History

In 1883 Mexican dollars of a later coinage than 1877 were called in, and a term was fixed after which they would cease to be legal tender. In 1885 decimal bronze coins were introduced. In July, 1886, a decree was published calling in all foreign and Chinese chop dollars13 within six months, after which date the introducer of such coin into the Colony would be subject to the penalty of a fine equal to 20 per cent. of the value imported, the obligation to immediately re-export the coin, and civil action for the misdemeanour. At the expiration of the six months the Treasury was not in a position to effect the conversion of the foreign medium in private hands prior to the publication of the decree. The term was extended, but in time the measure became practically void, so far as the legal tender was concerned. However, the importation of Mexican dollars was still prohibited; but, as they remained current in Manila at par value, whilst in Hong-Kong and Singapore they could be bought for 8 to 12 per cent, (and in 1894 25 per cent.) less than Manila dollars, large quantities were smuggled into the Colony. It is estimated that in the year 1887 the clandestine introduction of Mexican dollars into Manila averaged about ₱150,000 per month. I remember a Chinaman was caught in September, 1887, with ₱164,000, imported in cases declared to contain matches. In 1890 there was a “boom” in the silver market. Owing to the action of the American Silverites, the Washington Treasury called for a monthly supply of 4,000,000 of silver dollars; consequently sight rate on London in Hong-Kong touched 3s. 10¼d., and in Manila rose to 3s. 10½d., but a rapid reaction set in when the Treasury demand ceased. In 1895 we heard in Manila that the Government were about to coin Philippine pesos and absolutely demonetize Mexicans as a medium in the Islands. But this measure was never carried out, probably because the Government had not the necessary cash with which to effect the conversion. Some few Philippine peso pieces were, however, put into circulation concurrently with the Mexican pesos.