all at peace, and the town is increasing in population because of the good and healthful character of that country.

This year I have sent people to settle the city of Segovia in a province called Cagayan, in this island, a hundred leagues from this city. It is the frontier of China, and much benefit is expected from its settlement—for it is the best-situated port, with a harbor of greater depth, for the ships which sail in the line from Nueva España and Peru; and it is so near to China that one can cross thence in three days. For the sake of the future I consider it very important to have that frontier settled. I sent for the settlement thereof Captain Juan Pablos de Carrion, with about a hundred picked men. They go in good order, well provided with artillery, vessels, ammunition, and with the approbation and blessing of the church. God will be served through them, and your Majesty as well.

In the years 80 and 81 there came to these islands some pirate ships from Japan, which is located about four hundred leagues from here. They did some injury to the natives. This year, as warning was received that ten ships were being prepared to come to these islands, I have sent a fleet to the place where they are accustomed to come. This fleet is composed of six vessels, among them a ship and a galley well supplied with guns. I will send later advices of the outcome. The Japanese are the most warlike people in this part of the world. They have artillery and many arquebuses and lances. They use defensive armor for the body, made of iron, which they have owing to the subtlety of the Portuguese, who have displayed that trait to the injury of their own souls.

Although I have had no letter or advices of the state of affairs with Portugal, it seemed to me in the year 80, that we should live with great care and circumspection on account of what might happen, as the Portuguese are so quarrelsome, and especially if Don Antonio, the Prior of Crato,1 should come here. In order to try to ascertain the state of affairs at Maluco and at Macau, the post held by the Portuguese in China, I have sent for this purpose to the islands of Maluco the sub-lieutenant Francisco de Dueñas with four companions. He is well-instructed as to what course to pursue. Likewise I sent to Macau Father Alonso Sanchez of the Society of the Name of Jesus, a person in whom are combined many admirable traits.2 They are going to try to prepare and calm the people for the time when certain news will be had of the occurrences in Portugal. They will bring back a report of everything which has been learned there of affairs, even to the defeat of the Infante Don Antonio. I realize that it is necessary to be diligent in order to effect the desired ends, or that at least I shall be informed of the conditions there, and the forces with which the Portuguese are supplied.

The governors who have been here have used no system in making disbursements from the royal exchequer. They have followed the plan of spending as they saw fit and convenient to your Majesty’s royal service. I have continued in the same way because in no other manner would it be possible to support it or make advancement. The expenses here are for the most part extraordinary, and of small sums, as the royal exchequer cannot allow more owing to its limited resources, as I have already said. For expenses of considerable sums, as those incurred in despatching fleets for our settlements, against pirates, and in paying the salaries of corregidors and alcaldes-mayor, the officials ask me to request an order from your Majesty. I have no other way of complying with the obligations of your royal service. Will your Majesty please to have an order sent me, in order that when I consider it convenient for your royal service, I may make payments from the royal treasury? It is not possible otherwise to maintain your royal service. The total expenditure is but slight, and is watched and regulated with all care.

There are several men, newly-arrived in this country, who are always writing advices and opinions in respect to the aforesaid matter and others. It would be best for the royal service that the decrees despatched therefor be sent submitted to the consideration of the governor. As we are so far away it is right, ceteris paribus, in order to insure progress, that confidence be placed in the governor.

By other letters, I have already given advices of the imposition of three per cent as duties on both importations and exportations of the merchandise of both Spaniards and Chinese. A freight charge of twelve pesos per tonelada is also imposed. Considering their large profits, these duties are very moderate. For this reason, and because the instructions brought by the adelantado Legaspi decreed the collection of five per cent from the people of this country and seven from the merchants of Mexico, and as the collection at that rate cannot, in good conscience, be too long delayed, I have decided to enforce it. Your Majesty will provide according to the royal pleasure. In my opinion, the regulations made are moderate, just, and desirable for the royal service.

I also gave information that I had sent a ship to Piru in the year 81. From all that I hear, it is important for the progress of this kingdom that it trade and have commerce with the others; therefore I am sending this year another ship, for private individuals, to Panama. Consequently, I shall have ships sent to the principal kingdoms held by your Majesty in the Indias and the Southern Sea. The ship for Peru carried some artillery to be delivered to the viceroy, among them a piece of eighty-five quintals. I decided to do this, knowing the need there for heavy artillery, as the strait had to be fortified.3 I think that the artillery arrived at an opportune season, for I have had a letter from the viceroy, Don Martin Enriques, in which he begs me to let him know if I could supply him with heavy artillery. I am only waiting for [the return of] the ship which I sent a year ago, in order to furnish him with as much as I can, for I consider that your Majesty will be thereby served.

The viceroy, Count de Coruña,4 regrets that I despatched ships to a point outside of Nueva España. I can well believe that he has been persuaded to this view by the merchants interested in trade, as they do not wish the gains to be divided. Those who consider the subject without prejudice, however, will understand the great advantages which might follow thereby to this country, in that people will come hither and commerce be opened upon all sides.

The affairs of this country are improving to such an extent that the cargo of this ship bound for Nueva España is worth four hundred thousand pesos. It carries two thousand marcos of gold without taking into account the large quantity of goods intended for Panama.

In the past year, 81, there came from Nueva España three Theatins; and two priests, Father Antonio Sedeñopublic@vhost@g@gutenberg@html@files@16501@[email protected]#d0e387" class="noteref pginternal" id="d0e387src"