22 



The most important points of the budget, in addition to 

 the military and naval expenditure, are the civil servants 

 list, the bread or flour subsidies, the floating debt, the State 

 industries, the State railways, the harbours managed by the 

 State, the Post Office, representing productive and unproduc- 

 tive expenditure. 



Revenues. 



A constructive policy is sure to re-establish the confidence 

 ol the public in the internal possibilities, which are very far from 

 even being realised by the great majority. As soon as tne sterling 

 values are negotiated normally in the Portuguese markets the 

 exchange will ameliorate, the cost of living will decrease, and the 

 Government finances will progress. Taxation to a certain extent 

 must be enforced, but the psychological factors ol connaence and 

 of the will to invest money within the country are perhaps more 

 effective still. The amount of paper money in circulation, the 

 floating debt, and the loans to the Treasury are such that the 

 only possible policy would be to transform an unreal paper value 

 into a payable asset. Such works as hydro- electric installations 

 and irrigation schemes, would, within five years, change the face 

 of public finances. Facilities granted to big hotel companies in 

 order to attract foreigners to the watering places and to the winter 

 stations of the country would result in a rapid affluence of gold 

 into Portugal. It would be false to infer from the Budget that 

 the state of aifairs is hopeless, in 1920, for instance, the gross 

 revenue of agriculture, excluding dairy produce and stock 

 breeding, was estimated, according to official data, at 572, 500,000 

 escudos, or, at the then rate of exchange, 18,892,000. Admitting 

 that 50 per cent, was absorbed by the cost of production (which is 

 far too much), the net income would be 9, 446, 000. 



The industrial revenues represent a few millions. 



The remittances from Brazil amount to 3,000,000 (very often 

 much more) per annum. The remittances from other places 

 where Portuguese colonies exist (San Francisco, New Bedford, 

 Haiti, British Guiana, &c.) are estimated at 1,000,000. 



The expenditure of foreign steamers in the Portuguese 

 harbours is estimated at 500,000. Money spent by foreign 

 travellers in Portugal may be estimated at 200,000 an item that 

 might be considerably increased. In addition to this, there is the 

 revenue from Madeira, and the Azores, where foreign shipping and 

 foreigners are estimated to spend approximately 2,000,000 per 

 annum. 



The colonial trade is another sterling asset of considerable 

 importance. The cocoa islands of San Thome and Principe export 



