New-York tribune., 1922-02-12
Chile's Financing
Is Completed With
Internal Borrowing
import Duties of Country
Will Be Put at Disposition
of Treasury Director TO
Provide for Amortization

Special Foreign Financial Correspondence
SANTIAGO. Jan. 24.-The project.
which has been under discnssion in the
Chilean Congress for some weeks past,
for the negotiating of new govern
mcnt loan to meet the deficit in the
nations finances for 1921. has been
finally passed on by both houses and
made law on December %, 1921.
The form in which the proposal WAS
first made and introduced to Congress ss
was that Of an internal loan for l40,-
100000 paper pesos, but in its passage
through the Legislative chambers vari-
Gus alterations were made, so that at
present authorized it calls for two
offerings One of these is an internal
loan Of 10000, 900 paper pesos. which
may take the form of bank credit or
the emission Of renewable treasury GER
thcates or government bands. and with
the privilege OF having recourse to one
or more Of the methods indicated.
These obligations may pay an an
rual interest IN to & per cent, be re-
oeemcd within a period of not less than
I'VE and not more than ten years. and
are TO be exempt from all ratiQnal and
municipal taxation. The bonds and
treasury certificates may be deposited
by national banks with the Office Of
tsca issue, as security for the with
drawal Of amounts of paper money up
90 go per cent of their market value, as
authorized by a law passed on August
:. 1914.
sl.500.o0O Loan
Thc other loan is for an amount to
yield up TO II, 100000 at an interest
and may take the form of either a
hank credit or an issue of bonds
The amount obtained from this latter
loan may be deposited by the President
nj Chile in open account in London or
New York banks, to be used in meeting
the gold obligations of the government.
No Conversion Since 1895
To provide for the amortization Of
the loan in paper currency 15 per cent
of import duties of the country will
ho put at the disposition of the Di-
rector of the Treasury.
Reports are current that negotia
lions have already been started with
Certain important Santiago banks for
the placing of the loan OF SO,OOO,OOO
paper pesos. The Bank of Chile is be-
lieved to have subscribed for 50,0O0.o0O
pesos, the Spanish Bank for 100000
% 10000 900 pesos, the National Bank
for 1000 600 and the Edwards and
'tdiIdll DdiiNS lOI --,OOu,OOU W C,UOU,UOO
pcsos. The loan in pounds sterling
viii probably be placed with the Brit
ish bankers, Rothschids & Sons. who
are rumored to have recently renewed
tnclr interest in negotiations of this
character in Chile.
Another project which has been oc-
cupying the attention of Congress is
that for rostponine until 1924, the date
sct by law for the redemption of paper
money in circulation. and putting the
fnanccs of the country on a metallic
hesis.
There has been no gold conversion
x the currency since 1890 at which
,tole practically all the paper money
out standing was retired at the rate O,
- pence per peso. In 1898. when war
With Argentina was .rumored the gov
crnmcnt. n order to avert a financial
crisis. made an issue OF $4,000, 900 un-
ecured paper pesos, and from tha,
late until the present time the date of
conversion has been repeatedly post
poned and fresh emissions Of incon-