The record-union., 1899-08-19
Credit Of the Country To-Day Better Than
II Has Been for Years.
Her Wonderful Resources and In
dustries That Have Long Been
Dormant Gradually Being Re-
vived, and Fields for Employ
ment of Capital Being Ex-
plotted.

Correspondence of the Associated Press)
VALPARAISO Chile, July 20.-For
the last five or six years, in fact since
the melancholy war of 1891, the repub-
lie of Chile has been passing through a
period of commercial turmoil and po-
litical agitation Hampered by q
heavy internal and foreign debt, and
crushed under the burden of heavy
taxation to keep up the strength of her
navy in view of a possible conflict with
Argentina, it has only been in the last
few months that the prospect has
frightened materially. The disastrous
effects of the financial crisis of July
last year. far reaching and serious as
they were. have in a great measure
been got over, and the credit of the
country is better to-day than it has
been for many years.
Attention is also be directed to the
wonderful resources of the republic
and industries that have long been dor
mant and are gradually being revived.
Fields for employment of capital are
gradually being exploited, and general
trade, which for years has been in a
stagnant condition, is gradually i'm
proving.
and other wealth of the country has
been almost entirely neglected, and the
home and foreign debt went up by
leaps and bounds. The foreign debt
has risen from S47,9 800 in 1891 to
about $S0,000,000 last year. The
financial credit of the country was very
bad, and the crash of last year inten-
sified the situation.
.Nominally, Chile has no State bank
but there are twenty banks of issue.
Phe joint capital of these is put down
at $40, ,S1S S29 and the registered issue
at $13, ,44S, ,361. This issue is supposed
TO be guaranteed by deposits in god
and Government securities in the treas
uTy. The nominal value of these issue
guarantees is $92,2Io,33S. A conver-
sion law came into force February 10,
1895, providing that the redemption of
the paper currency should be effected
from June 1st Of that year, at the rate
Of 81 cents per dollar, has authorized
the issue of coinage. The outstanding
notes and currency December 81, 1896,
amounted to $15, 19S, 100, nearly S45,-
000000 having been converted.
For a time the republic struggled no
bly, to get rid of its paper money, and
established a gold standard. But in
the middle of July, 1898, in consequence
of the outrage and extravagant ex
penditures on battleships and arma-
ments, the Government could not meet
some of its liabilities, and one of the
leading banks found itself in difficult
ties. This soon leaked out and a rush
was made on the Banco de Chile, with
the result that the Government, in
order to save the situation, had to ord
er a decree providing for a general sus-
pension of payments for a period of
thirty days A financial crisis follow
ed, with the result that another issue
of S50.000000 in paper had to be made,
and as a consequence business of every
character was greatly disturbed. Ex-
change fiuctuated very much, and the
premium Of gold was as high as 80 per
cent.
S The future of Chile appeared to be
very dark indeed, and her politicians
could scarcely hold out much hope of
Improvement But at almost the hope
less period matters righted themselves
naturally.
A threatened rupture with Argentina
was. ever present spectre of alarm to
the Chilean statesmen. Treaties had
been signed as far back as 1881 by
both nations, providing that any disa-
greement about the limits of territory
should be referred to the arbitration of
a friendly Power.