handed over to
private enterprise. At that date there were five Government Cigar and
Cigarette Factories, viz.:--Malabon, Arroceros, Meisig, El Fortin,
and Cavite, giving employment to about 20,000 operatives.

Up to within a year of the abolition of Monopoly, a very good smokeable
cigar could be purchased in the _estancos_ [140] from one half-penny
and upwards, but as soon as the free trade project was definitely
decided upon, the Government factories, in order to work off their
old stocks of inferior leaf, filled the _estancos_ with cigars of
the worst quality.

The Colonial Treasurer-General at the time of this reform entertained
very sanguine hopes respecting the rush which would be made for the
Government brands, and the general public were led to believe that
a scarcity of manufactured tobacco would, for some months, at least,
follow the establishment of free trade in this article. With this idea
in view, Government stocks sold at auction aroused competition and
fetched unusually high prices at the close of 1882 and the first month
of the following year, in some cases as much as 23/- per cwt. being
realized over the upset prices. However, the Treasurer-General was
carried too far in his expectations. He was unfortunately induced to
hold a large amount of Government manufactured tobacco in anticipation
of high offers, the result being an immense loss to the Treasury,
as only a part was placed, with difficulty, at low prices, and the
remainder shipped to Spain. In January, 1883, the stock of tobacco in
Government hands amounted to about 100 tons of 1881 crop, besides the
whole crop of 1882. Little by little the upset prices had to be lowered
to draw buyers. The tobacco shipped during the first six months of the
year 1883 was limited to that sold by auction out of the Government
stocks, for the Government found themselves in a dilemma with their
stores of this article, and the free export only commenced half a year
after free production was granted. On December 29, 1883, a Government
sale by auction was announced at 50 per cent. reduction on their
already low prices, but the demand was still very meagre. Finally,
in the course of 1884, the Government got rid of the bulk of their
stock, the balance being shipped to the mother country. The colonial
authorities continued to pay the ancient tobacco-tribute to Spain,
and the first contract, with this object, was made during that year
with a private company for the supp