Your letter, now under consideration, contains practically a definite answer to our communication to you.  I shall now consider the points of your answer separately.

BEWAARPLAATSEN.

With reference to this matter, we think that the undermining rights under bewaarplaatsen, machine stands, and water-rights should be valued on a reasonable basis, independently by the Government, and by the owner of the surface rights (should there be a difference which cannot be settled amicably, then the value can be fixed by arbitration), and that the surface owner shall have the preferent right to purchase the affected under-mining right at such a valuation.  From your communication I understand that you suggest a special method of valuation.  That is a detail which can be settled when the valuation is actually commenced, and which experts are better able to judge over than I am.  Therefore I shall say no more on this subject.

FINANCIER AND AUDITOR.

On this subject our opinion was that the auditor should be independent of the Government, and alone responsible to the Volksraad to appoint as financier a man of standing, with a seat in the Executive Council, to advise on all matters affecting finances.

I am glad to see that you are with us, and that it gives you great satisfaction.  I must express my surprise, however, over your proposal that previous to the appointment this Government must first get the approval of Lord Rothschild or any other capitalist.  I can only answer that it is in no wise the intention of the Government to frame the future financial policy of this State on a capitalistic basis, and thus your request cannot be agreed to.  It is quite possible to make such an appointment which will carry general approval without being subjected to such a mutual condition.

LOAN, PRESS AGITATION, POLITICAL ORGANIZATION.

With reference to these matters, I have already made it plain to you that in following the proposals of Mr. Lippert by cabling to your principals, you acted under a misunderstanding.  We requested no binding declaration from you, only a moral understanding, which would be easy for you to maintain, if it was in the interests of the Uitlanders as well as the burghers of the Republic.  I regret that the mistake has arisen, otherwise I cannot see that any objection can come from your side to approve of the plans of the President.

DYNAMITE.

On this question there is a small difference between the proposed policy of the President and your answer.

I only wish to add that his Honour goes further than you do, as he has declared his readiness to expropriate the Dynamite Company, under agreement with its representatives, as soon as possible.  If the expropriation takes place after the expiration of the present concession then it will naturally not be on the basis of a going concern.

FRANCHISE.