XIII.

CURRENCY AND BANKS.

The Venezuelan Government, in reply to a communication of the Government of the United States, under date of October 6, 1896, gave the following official information in regard to the currency laws of Venezuela:

The law in force in the United States of Venezuela with respect to the value of the national money, in gold, in silver, and in nickel, is that of the date of July 9, 1891. It provides that the fineness for gold shall be of 0.900, and for silver shall be of two classes, one of 0.900 and another of 0.835.

The monetary unit is expressly established in article 2 of the law quoted, in these terms:

The monetary unit of the Republic shall be the silver bolívar, which shall be considered as divided into one hundred parts, or centésimos.

The payments of public and private debts are not made on terms of equality with the gold, silver, and nickel national moneys. Those of gold, coined in accordance with the law of the country, are obliged to be received in any quantity whatsoever for the value that the law has given them. Those of silver coined in accordance with the same laws, must be received for those particular matters in the following quantities: Those of 0.900 as far as the sum of 500 bolívars ($96.50); those of 0.835 as far as the sum of 50 bolívars ($9.65); those of nickel and copper as far as the sum of 20 bolívars ($3.96). The gold of Venezuela's coinage is maintained absolutely at the par of the legal unit of calculation in the payment of obligations, and the silver and nickel, also, at the par of the said unit, but within the limitation which has been stated above.

By these arrangements of the monetary law, the unit is the silver bolívar, of 4 grams weight and medium fine, but it is subject in actual payments to the absolute ruling of gold, and in its relative legal appraisement, which, examined by that of 0.900 fine, gives the proportion of 15 gold for 1 of silver in intrinsic value. Upon these terms the nation coins both metals and authorizes the payment of its debts.

With respect to foreign gold moneys, they circulate in the Republic as if they were merchandise, their price being subject to the relations which exist between supply and demand.

The circulation of foreign silver money is prohibited in Venezuela, and by subsequent enactments, moreover, the introduction of foreign

silver money and even of the silver coined in Venezuela, which for any reason might be imported by private parties was also prohibited.

The unit of silver, or the bolívar, fineness 0.900, and weight 45 grams fine (it may be five, coined by the first legal stamping), in exchange on London, which, at the date of this report,' is 25.80 per pound sterling, should have the value of 97.868 centésimos, because the loss in exchange is 2.132 per cent, the accepted par in the Venezuelan market for English gold being 25.25 per pound sterling.

The monetary unit is determined by law, exists in practice, and is the existing measure of value ruling calculations, protected by the guaranty which is explicitly derived from the limited circulation of the silver bolívar and in the governing circulation of national gold.

The circulation of gold is calculated at 101,538,129.90 bolívars ($19,596,859.07); silver at 14,000,000 bolívars ($2,702,000).

In the circulation of gold, the quantity of foreign money which conventionally is current between banks and in commerce without any difficulty to the public, in accordance with its weight and law, and conforming to a tariff of simple agreement, can not be calculated because the law declares foreign gold money to be merchandise.

There are not, nor is it necessary to have, foreign silver moneys in circulation; they are strictly prohibited.

Official paper money does not exist, neither do General Government or State notes, but the circulating bank notes are taken at par of Venez uelan gold as paper money. The following amounts exist, serving as the instrument of exchange in transactions: Notes of the Bank of Venezuela, on June 30, 1896, in hand, 90,100 bolívars ($17,589.30); in circulation, 1,659,900 bolívars ($320,360.70); total, 1,750,000 bolívars ($337,750). Notes' of the Bank of Caracas, on June 30, 1896, in hand, 891,780 bolívars ($172,113.54); in circulation, 742,320 bolívars ($143,267.76); total, 1,634,100 bolívars ($315,381.20). Notes of the Bank of Maracaibo, on June 30, 1896, in hand, 480,000 bolívars ($92,640); in circulation, 720,000 bolívars ($138,960); total, 1,200,000 bolívars ($231,600).

Since the money law of 1891, above cited, no change has been effected in the monetary system of the country except the resolutions prohibiting absolutely the importation of foreign silver money, and that concerning Venezuelan silver when the latter is not imported by the Government.

The presentation to the Government of various specimens of coun

October 6, 1896.

terfeit silver moneys, which had the same model as that determined by law for Venezuelan money, gave cause for this resolution, dated August 14, 1893; also, because the Government had well-founded reasons for believing that its silver money was being falsified in some foreign country.

The manufactures of the country have not experienced any effect practically, either favorable or adverse, by reason of the money, because its price has always been in harmony with its legalized value and its necessity as an element of exchange in transactions as much in 1886 as now in 1896.

What really impedes the creation of new industries is the want of roads, which will cheapen freights and lower interest on capital, because the profits of the existing enterprises scarcely satisfy the costs of manual labor, interest, and the insignificant compensation of the managers.

In wages scarcely any variation has been noticed.

At the present time' 43.70 bolívars (88.744) of gold money circulate per inhabitant, and 6.02 bolívars ($1.16) of silver per inhabitant. Total per capita in United States money, $9.90.

The mint of the country is not in operation inasmuch as there is no coinage of metals. Neither the price of gold nor of fine silver, nor any variations to note, emanate from the establishment.

In the market of the mining district of the Republic the dominating price for 1 kilogram of pure gold is 3,448 bolívars ($665.40). In the economical year 1895-96 there were exported 1,311.474 kilograms of gold ingots and 4,022,814.60 bolívars' ($776,403.26) worth of coarse gold.

The bolívar is equivalent to the peseta or franc, with a value equal to 19.23 cents in United States currency. The gold coins in actual circulation are of the denominations of 100, 25, and 20 bolívars, and the silver coins of the denominations of 5, 24, 2, 1, 1, and bolívars. The circulation of foreign money is prohibited, and foreign gold pieces, although accepted in circulation, are considered as a commodity and only have a conventional value. The American gold 20-dollar piece is worth 104 bolívars and its fractions in proportion.

There are three banks of issue in Venezuela: The Bank of Venezuela, with a capital of 8,000,000 bolívars and a reserve of 974,753.39 bolívars; the Bank of Caracas, a joint stock corporation, having a capital of 6,000,000 bolívars and a reserve fund of 345,928 bolívars, and the Bank

October 6, 1896.

of Maracaibo, with a capital of 1,250,000 bolívars and a reserve fund of 312,500 bolívars.

These institutions have agents in the principal cities of the country and in some commercial centers of Europe, and in New York, in the United States. They are private institutions, doing a large business in and out of the country. They issue notes payable to bearer at sight on presentation to the main office. There are in Caracas besides these banking institutions two banks of loans and discounts and the Savings Bank.

XIV.

MEANS OF COMMUNICATION.

Communication is favored in Venezuela by the natural means of rivers, lakes, and plains. There are also railroads, wagon roads, and telegraph, telephone, and mail lines, which bring together all the localities in the extensive territory of the Republic.

INTERIOR NAVIGATION.

Of the 70 navigable rivers Venezuela possesses, the Orinoco, the Apure, and the Portuguesa are navigated by steam and sailing vessels carrying on the trade between Ciudad Bolívar, Caicara, San Fernando, Nútrias, Arauca, Camaguán, and Baúl. By the Orinoco and Meta rivers sailing and steam vessels also go as far as Colombia. There are steamers carrying on the trade between Ciudad Bolívar and the British island of Trinidad, and one which transports cattle, by the Orinoco, destined to British Guiana. Steamship communication also exists between Maracaibo and La Ceiba, situated on Lake Maracaibo, Encontrados, on the Catatumbo River, and San Carlos del Zulia, on the Escalante. The navigation of Lake Valencia is carried on by means of small craft and steamers. The trade between the many points of the extensive coast line of Venezuela is carried on by means of numerous sailing vessels and several steamers daily leaving the national ports. There is a special line between La Guaira and Rio Chico. Two steamers make trips between Puerto Cabello and Tucacas, and another steamer plies on the Yaracui River and on the sea as far as Puerto Cabello. Another steam vessel carries on a coastwise trade from Puerto Cabello, touching at various ports of the eastern coast and entering the Orinoco, to Ciudad Bolívar.

COMMUNICATION WITH FOREIGN COUNTRIES.

Communication with foreign lands is maintained by means of steamships belonging to American, English, French, Dutch, German, Italian, and Spanish companies. The freight and passenger traffic between New York and La Guaira, Puerto Cabello, Coro, and Maracaibo is regularly maintained by the "Red D Line," an American company, dispatching steamers monthly to the three ports first mentioned and to Maracaibo and Coro direct. One or two Dutch steamers, carrying passengers and freight, leave regularly every month for La Guaira, Puerto Cabello, Cumaná, Carúpano, Guanta, Ciudad Bolívar, and other ports, and a Spanish line carries passengers and freight to La Guaira and Puerto Cabello. There is an English line of passenger and freight steamers to Ciudad Bolívar and other points, transshipping at Trinidad. Besides these there are one or more sailing vessels leaving United States ports every month for Venezuela.

Communication with Europe is very frequent, among the principal steamship lines being the French and Spanish trans-Atlantic lines, the Hamburg-American Line, the Italian Line (La Veloce), the Dutch Line, the Harrison, Royal Mail, West India, and Pacific. It may be safely stated that Venezuela is in daily communication with the United States, Europe, and the West Indies.

RAILROADS.

The present railroad mileage in operation in Venezuela is 503 miles. Four lines start from Caracas, the capital, connecting it on the north with La Guaira, which is the principal port of the Republic; on the west, by the Gran Ferrocarril de Venezuela, with Valencia and way stations; on the east, by the Gran Central, with Petare and other towns; and on the south, by the Valle Railway, with the city bearing this name. The railway from Caracas to La Guaira, belonging to an English company, is one of the most notable engineering works in Spanish America, owing to the difficulties that had to be overcome in its construction, due to the difference of elevation (2,984 feet) and the irregular conformation of the coast range, separating the capital from the port. Although the distance in a straight line between the two points is barely 5 miles, the length of the railway line is 221⁄2 miles, the smallest radius of the curves is 140 feet, and the maximum grade 3.75 per cent.

10217 -8