Committee felt that action on their part could not longer be postponed.

The Government were accordingly informed that it was intended to call a Public Meeting of the Bondholders unless an immediate settlement was made, but their only reply was to request a further delay until 30th June, 1904. The Committee's answer to this was that, pending the conclusion of a definitive Agreement, monthly remittances should be made on account, but it is perhaps superfluous to say that the Government, though lavish with promises, were not disposed to part with any cash. The Mecting accordingly took place, and resolutions were unanimously passed protesting against the continued default, and formally recording the resumption by the Bondholders of their full rights under the Arrangement of 1885. It only remains to add that the 30th of June has passed, and no settlement has ever been proposed by Costa Rica.

The conduct of the Costa Rica Government in leaving its External Debt year after year in total default while regularly paying its Internal Obligations is deserving of the severest condemnation.

HONDURAS.

In the Appendix to the Report will be found a detailed account of the negotiations which were carried on in the early part of the present year between Dr. Ugarte, the Agent of the Honduras Government, and the Committee.

Bondholders will be able to judge from what took place in this case of the great difficulties which their representatives have to encounter. It never seems to occur to most of these defaulting Governments that no debts can be paid without some sort of sacrifice on the debtor's part, and that their most sacred duty is to

discharge their obligations to trusted them with their money.

foreigners who have As regards Honduras,

the Committee were prepared to recommend such exceptionally generous terms that little or no sacrifice. would have been imposed on the country. When it is borne in mind that a tax of 6d. per annum per head of the present population of the Republic, gradually rising in twenty-one years to a maximum of Is. per head, would provide the sum it was proposed that Honduras should pay, it is incredible that such an offer should have been rejected, and that the Government should prefer to enter on its thirty-first year of total and disreputable default.

In accordance with the provisions of the Corporation of Foreign Bondholders Act, seven members of the Council retired at the Second Quarterly Meeting of the Council held in April last. The vacancies were filled as follows:--

Mr. C. Surgey and Mr. W. Trotter were re-elected by the Central Association of. Bankers.

The Rt. Hon. Sir E. Thornton and Sir H. W. Tyler, by the London Chamber of Commerce.

Mr. J. W. Philipps, His Honour Judge Sir Thomas Snagge, and General Sir Luther Vaughan, K.C.B., by the Council.

The Rt. Hon. Lord Avebury and the Hon. Sir C. W. Fremantle were re-elected President and Vice-President of the Council respectively.

The sixth redemption of the Certificates of Permanent Membership in the Corporation, as provided by the Act, was held in May, 1904. The sum applied to this purpose

was £2,037. 4s. 3d. Twenty-nine tenders were accepted, the highest price being £75, and the average about £70. 4s. Id.

The Council desire to express their thanks for valuable contributions to their Library, received, in many cases, from foreign Governments or their representatives. Statistical and other data have been received regarding the Argentine Republic, Brazil, Bavaria, Canada, Colombia, Costa Rica, Ecuador, Egypt, France, Greece, Guatemala, Honduras, Luxembourg, Mexico, New South Wales, Nicaragua, Paraguay, Portugal, Salvador, Turkey, the United States, Uruguay, and Venezuela. The additions to the Library during the year numbered 219.

30th July, 1904.

AVEBURY, President.

JAMES P. COOPER, Secretary.

APPENDIX TO REPORT.

ARGENTINA.

EXTERNAL DEBT.

I-LOANS ORIGINALLY ISSUED BY THE NATIONAL GOVERNMENT.

II.-LOANS ISSUED BY THE NATIONAL GOVERNMENT IN SETTLEMENT OF PROVINCIAL AND MUNICIPAL DEBTS AND RAILWAY GUARANTEES.

(a) Created for settlement of National Railway Guarantees in arrear.

(b) to (m) Created for the settlement of the following Provincial and Municipal Obligations, viz. (6) Province of Buenos Ayres; (c) City of Buenos Ayres; (d) Province of Santa Fé; (e) Province of Entre Rios; (f) Santa Fé Railways; (g) Province of Tucuman; (h) Province of Cordoba: (i) Province of Catamarca; (j) Province of San Juan; (k) Province of San Luis; (7) Province of Corrientes; (m) Province of Mendoza.