40 SPAIN - CRKDIT 



Fund formed to act as intermediary between them and the credit establish 

 ments. 



The object of the decree, as specified in Article i, is to promote in Spain 

 the employment of capital for the improvement of agricnltural production 

 and stock farming by stimulating the formation of agencies for supply- 

 ing the materials and machinery needed by the technique of modern agri- 

 culture, and by endowing these agencies with the necessary pecuniarj' 

 resources. With this object, says the decree, the State will endeavour to 

 develop the spirit of association as well as the associations themselves, 

 forwarding that educational activity which causes the need for them to 

 be born and felt, indicating which forms of them are most suitable with the 

 help of all official or private organizations already in being, exercising by 

 means of advice a directive influence over such as are constituted, seeing 

 that they command the capital necessary to their life and development, 

 and taking steps to obtain from banking and commercial companies that 

 they collaborate by employing all their available funds on the work of 

 expanding the agricultural associations. Such are the social functions en- 

 trusted to the new Central Fund. 



To resume, the terms of the decree may be summarized in the follow- 

 ing points which show the basis on which an institution of agricultural 

 credit is to be set up in Spain : a) the creation of an official central agency 

 which will dispose of contributions furnished by the privileged and free 

 banks and the State, and will seek to invest in the country districts the 

 money forming the savings deposits of establishments belonging to the ur- 

 ban banks, and to forward rural association as a basis of credit ; b) the 

 constitution and regulation of agricultural associations ; c) the determina- 

 tion of transactions in agricultural credit ; and d) the preservation and mo- 

 dernizing of the posiios by completing their liquidation and adapting their 

 methods to the needs of modern agriculture and of the bank. 



I. The Central Fund of Agricultural Credit and its Business, 



The constitution and working of the Central Fund of Agricultural Cre- 

 dit formed by the decree in question imply no original idea for, as the pre- 

 amble to the decree expressly indicates, the provisions governing the Fund 

 have been borrowed indiscriminately from all central banks and from like or- 

 ganizations in many countries, particularly Poland, Germany, Itah^ and Ru- 

 mania. However in view of this catholicity, and of the adaptions which have 

 taken place to suit both the necessities and the possibilities of Spanish 

 agriculture, a short examination of the organization and the business of the 

 establishment which has been created will not be without interest. 



In addition to the functions we have mentioned, aimed at encouraging 

 and multiplying agricultural associations by moral and pecuniary support 

 and by a supervision whch will ensure their normal development, and at 

 intensifying the financial relations between these associations and banking 

 organizations by advancing the investment of the funds of the latter in 

 combinations for agricultural credit, the principal transactions of the 

 Central Fund will be as follows : 



