io 72 BRAZIL 



Buenos Aires on October nth, and La Paz on November gth. Brazil was represented 

 abroad at several important international Congresses, while the State was added by the 

 Brussels Sugar Convention to the list of countries according bounties. 



On October 21, 1909, the Department of Agriculture, Industry and Commerce estab- 

 lished the Bureau of Animal Industry, designed to promote cattle rearing. 



The financial condition of the Republic, which had been somewhat improved under 

 the Presidency of Dr. Alfonso Penna, again showed signs of distress. The Executive 

 found it necessary to issue a decree (Aug. 12, 1909) reorganizing the financial adminis- 

 tration of the Acre Territory, and drawing the attention of the public generally to tne 

 great excess of expenditure over revenue. The increase in the National Debt was ex- 

 plained partly by new loans which had been raised for national improvements, such as 

 increased dock facilities and new railroads. The railway mileage increased by 366 miles, 

 and important concessions were granted to many foreign syndicates and individuals. 

 Port-improvement works were also commenced, or were continued, at Rio de Janeiro, 

 Manaos, Para, Natal, Cabedello, Pernambuco, Bahia, Santos, Florianopolis and Rio 

 Grande. The line uniting Brazil with Uruguay was completed in July 1912. 



On January 3, 1910, financial conditions again being mended, payments on account 

 of the Foreign Debt were resumed, anticipating by eighteen months the time specified 

 in the Funding Loan agreement with foreign bondholders (of June 1898), when the 

 amortisation was suspended for thirteen years until June 1911. The Public Debt was 

 also, later on, reduced by 3,121,961. On March ist Marshal Hermes da Fonseca was 

 elected President for the ensuing term, and shortly afterwards he commenced a tour of 

 Europe, being well received at most of the foreign Courts. He visited London in Septem- 

 ber, returning to Brazil in November. 



On March 17, 1910, a new 4 per cent (gold) Federal Loan for 100,000,000 frs. was 

 floated in Paris, being offered at 89! per cent, and intended for the construction of the 

 Goyaz Railway. At the same time, negotiations were authorised for the raising of 

 a loan of 10,000,000 by the House of Rothschild, for the purpose of converting the 5 

 per cent gold bonds of the Foreign Debt into 4 per cent, thus saving 400,000 per annum 

 in interest. Financial conditions continued to strengthen, the annual deficit in the 

 revenue showing a considerable reduction. The rate of exchange rose towards the 

 middle of the year to 37 cents (1/65) gold per milreis; but, by decree, the Government 

 established the rate at 32 cents Q-) gold. 



Commercially the Republic showed the highest total of foreign trade since its history, 

 the exports exceeding the imports by 14,926,320. On June 2, .19.10, a surtax of 20 per 

 cent for the port imports at Para was abolished. On September 22nd an official decree 

 authorised the creation at Rio de Janeiro of a Merchant Ship-Brokers Exchange. On 

 November i5th Marshal Hermes da Fonseca took office as President, and shortly after- 

 wards approved a new code of criminal procedure for the Federal district. 



Within a few days of the beginning of Marshal da Fonseca's term, the country was 

 confronted with a serious naval mutiny, which broke out on November 24, 1910, on board 

 the two " Dreadnought " battleships " Minas Geraes " and " Sao Paulo." The 

 mutineers, who complained 'of ill treatment at the hands of their officers, fired upon the 

 capital, causing considerable damage, several people being killed in the streets. The 

 President, who in 1904, while head of the military school at Rialengo, had been enabled 

 to prevent the students from joining in the revolution against President Rodriguez 

 Alvez, found much difficulty in dealing with the situation. An amnesty was granted to 

 the mutineers, while a battalion of troops which had joined them was allowed to surren- 

 der without undergoing punishment. The first mutiny was shortly afterwards followed 

 by a second, which, however, was suppressed with less difficulty. 



Apart from political and financial troubles, the progress of the Republic was satis- 

 factory. The Customs returns for 1910 showed an increase of 10,000,000 milreis over 

 the previous year, while the number of factories throughout the Republic increased to 

 3,300. The rate of exchange was again raised to i/6j, but a change of Government 

 shortly following resulted in the rate again being made 1/4. Railway mileage increased 



