The development of the resources of any country is, of course, intimately dependent upon the soundness and wisdom of its financial policy and administration. This is increasingly so under modern conditions in countries where international relations are of the greatest importance. Nothing could have been worse than the chaotic condition of the Korean finances when Mr. Megata, in conformity with the Convention signed between Japan and Korea on the 22d of August, 1905, was appointed Financial Adviser to the Korean Government by the Imperial Japanese Government.[65] Mr. Hulbert, who afterward became the most unsparing critic of Mr. Megata’s policy, himself wrote in the _Korean Review_, in 1903: “It is encouraging to note that every part of the Korean Executive has come to the conclusion that something has got to be done to put Korea’s money system on a more secure foundation.” It was, however, largely this same “Korean Executive” which had been chiefly responsible for the deterioration of the currency and for the entire confusion in the financial condition of the country. On this matter of the deterioration of the currency, the Financial Adviser says in one of his Reports:[66] “The currency of Korea, though nominally on a silver basis, has hitherto in reality possessed no standard, and only cash and nickel coins have been in circulation. Before the commencement of the reorganization of the currency, the market rate of the nickel coins fell to 250 _won_ for 100 _yen_ in gold (Japanese currency); while that of the cash fluctuated from 100 per cent. to 60 per cent. premium. All cash pass at a uniform rate in spite of their different sizes and weights. The market rate varies according to the condition of supply and demand. When the market rate is equivalent to one _rin_ (1-1000 _yen_ Japanese currency) it is called _par_; when it is 2 _rin_, the cash is at 100 per cent. premium. Cash are preferred in some provinces, nickel coins in other provinces. Since the commencement of the withdrawal of the old nickel coins in June, 1905, the market rate has gradually risen, and at present it is steady at the normal rate of 200 _won_ to 100 _yen_. (According to the Currency Law, the face value of the old nickel coin is 2.5 _sen_, its intrinsic value being 2 _sen_).”[67]