Peru has a considerable public debt, divided into an internal and external. The internal liabilities are estimated at 4,000,000l., exclusive of a floating debt of an unknown amount, greatly increased by large issues of paper money, made in 1879 and 1880 to carry on a war against Chili. The total of these issues was estimated, end of Oct. 1880, at 35,000,000 soles, or 7,000,000l. The foreign debt is made up of three loans contracted in England from 1869 to 1872:- -

The two loans of 1870 and 1872 were secured on the guano deposits (now, 1884, in possession of Chili) and the general resources of Peru. No interest has been paid on the foreign debt of Peru since 1876; an arrangement was made in 1882 with Chili by which a percentage of the guano deposits should be paid as interest to the bondholders; and a small amount was transmitted to England in 1883. The interest arrears of Peru amount (1883) to 13,192,9947.

The army of the republic was composed at the end of the year 1878 of eight battalions of infantry, numbering 5,600 men; of three regiments of cavalry, numbering 1,200 men; of two brigades of artillery, numbering 1,000 men ; and of a Gendarmerie of 5,400 men, forming a total of 13,200 men. The number of men under arms was raised nominally to 40,000 in May 1879, after the outbreak of hostilities against Chili, and further ordered to be increased to 70,000 men in the summer of 1880, after the successful invasion of the territory by the Chilians.

The Peruvian navy was the most powerful on the Pacific coast, until Chili began the construction of ironclads in 1874-5. At the beginning of the war with Chili, Peru possessed four ironclads, the Huascar, Independencia, Atahualpa, and Manco Capac, in addition to a number of unarmoured vessels. The two last-named ironclads were of very small size (about 1,000 tons displacement), with 5-inch laminated armour on the sides, and carrying two 9-inch Whitworth guns in a single turret: they were really coast-defence monitors. Of the two seagoing ironclads, the Independencia was lost by running on a rock during an action with the Chilians; and the Huascar was captured after a gallant fight with the two Chilian ironclads. The Peruvian navy has been practically destroyed.

Area and Population.

The area of Peru is estimated to extend over 503,000 English square miles, with a population, according to a census taken in 1876, of 2,699,945, comprising 1,365,895 males, and 1,334,050 females. The republic was divided into twenty-one departments, the area and population of which were reported as follows at the census taken in 1876:

There are besides about 350,000 uncivilised Indians.

As a result of the war with Chili, the latter country has annexed the province of Tarapaca. The Chilians also occupy the departments of Tacna and Arica for ten years, after which a popular vote is to decide to which country they will belong.

It is estimated that 57 per cent. of the population of Peru are aborigines, or 'Indians,' and that 23 per cent. belong to mixed races, Cholos' and 'Zambos.' The remaining 20 per cent. are chiefly descendants of Spaniards, and includes besides 18,082 Europeans, of whom 6,990 Italians, 2,647 French, 1,679 Spaniards; there are besides, 50,032 Asiatics, chiefly Chinese. At the enumeration of 1876 the population of the capital, Lima, was returned at 101,488, Callao 33,502, Arequipa 29,237, Cuzco 18,370.

Trade and Industry.

The foreign commerce of Peru is chiefly with Great Britain, and it is carried on from several ports, of which the principal are Payta, Salaverry, Chimbote, Callao, Pisco, Mollendo, Arica and Iquique. In 1877, the latest year for which there are statistics, the value of the imports was 4,835,8197, and exports (exclusive of nitre and guano) 6,326,8551.

The commercial intercourse between Peru and the United Kingdom is shown in the subjoined tabular statement, for each of the ten years from 1874 to 1883:

The staple articles of export from Peru to the United Kingdom are guano, cubic nitre, and sugar. During the ten years from 1874 to 1883, the quantities and value of the exports of guano from Peru to Great Britain were as follows::

The marked decrease since 1878 is due to the fact that Chili is in actual possession of the chief sources of Peruvian guano.

Guano has been used in Peru as a manure since the time of the Incas. The trade to Europe began in 1846. The chief deposits

were on the Chincha Islands. From 1853 to 1872 as many as 8,000,000 tons were taken from them, but in the latter year they were exhausted. Since then the deposits on the Lobos, Macabi, and Guañape Islands to the north and on the headland of Tarapaca to the south have been worked. About 600,000 tons remain in the north, and perhaps 1,800,000 in Tarapaca.

Equal in importance to guano as an article of export to Great Britain is cubic nitre, also a government monopoly. The exports of nitre were as follows in each of the years from 1874 to 1883:

:

As Chili holds the province of Tarapaca, where are large nitre deposits, the exports during the three years 1879-81 materially decreased, though they have risen again in 1882 and 1883.

The exports of sugar, in an unrefined state, small previous to the year 1869, assumed large proportions in recent years. The value of the exports of sugar rose from 512,1127. in 1874 to 1,380,6221. in 1879, but fell to 702,8697. in 1882, and 470,8197. in 1883. Among the minor articles of export to Great Britain are sheep and alpaca wool, of the value of 320,7927. in 1882, and 118,0007. in 1883; and copper, unwrought or part wrought, of the value of 356,8967. in 1878, but only 17,6337. in 1883.

The imports of British produce into Peru comprise mainly cotton and woollen manufactures. The imports of cotton goods amounted to 539,1067. in 1877; to 594,1667. in 1878; to 228,0317. in 1879; to 355,354. in 1881; to 478,1571. in 1882; and to 254,3017. in 1883. Of woollens the imports were of the value of 94,8787. in 1883. A system of railways, designed to develop the wealth of the country, has been in course of construction since the year 1852, mainly at the expense of the state. In 1878 there were open for traffic, or in course of construction, eleven lines belonging to the state, 1,281 English miles in total length, and costing 128,354,600 soles, or 25,670,9207.: eight lines belonging to private persons, 496 miles in length, and costing 24,420,000 soles, or 4,884,600l.;

and two lines, belonging in part to the state and in part to individuals, 253 miles, costing 27,200,000 soles, or 5,440,000l., being a total of twenty-two lines, 2,030 miles in length, and representing a cost of 179,974,600 soles, or 35,994,920l.

The construction of the lines of railway belonging to the State was undertaken solely for purposes of public utility, remunerative results not being calculated upon in a country so sparsely populated as Peru. Referring to the longest of the State lines, from Arequipa to Puno, near the summit of the Andes, the British Minister and Consul-General, in a report of the year 1878, says :-' 232 miles of difficult railway have been made, at an expense of about 6,000,0007., in order that three or four goods trains may run per week.' Of the railways belonging to private individuals, only the double line from Lima to Callao, eight miles, from Lima to Chorrillos, nine miles in length, the property of an English company, is reported to be a commercial success.

Peru has numerous silver mines. The most important are situated mainly in the Cerro de Pasco. Their produce amounted to 1,395,936 ounces in 1874; to 1,357,432 ounces in 1875; to 1,358,792 ounces in 1876, and to 1,427,592 ounces in 1877.

The length of telegraph lines in 1878 was 1,382 miles.

The merchant navy of Peru numbered 147 vessels, of 49,860 tons, including 8 steamers, of 1,768 tons, at the end of 1877.

Diplomatic Representatives.

1. OF PERU IN GREAT BRITAIN.

Envoy and Minister.-Don Rafael Izcue.

Secretary.-Eduardo Ford North.

2. OF GREAT BRITAIN IN PERU.

Minister and Consul-General.-Colonel Charles Edward Mansfield. Appointed Dec. 24, 1884.

Money, Weights, and Measures.

The money, weights, and measures of Peru, and the British equivalents, are: