Restless Empire
Page 7
While Britain used its victories over the Qing to solidify its hold on trade with China, Russia was expanding into outer Manchuria and along the Pacific coast. In 1858, at the height of the Taiping crisis and while China was at war with Britain and France, Russia presented its demands to Beijing. It was able to force a border revision that transferred to its control territory the size of France and Italy combined. For the Qing the new Russian expansionism was at least as threatening as that of the British, because it was overland and could potentially encroach on China along the 4,000-mile border from Central Asia to Korea. Thus, when Moscow tried to build up Muslim separatist regimes in Xinjiang in the 1860s, the Qing fought back, putting together what was to be its last major military campaign, culminating in the 1878 destruction of the pro-independence groups and—for the time being—a sharply reduced Russian influence there.
In the south, the Qing were confronted with an expanding French empire, which was laying claim to China’s Indochinese tributaries. In 1874 France claimed a controlling influence in all of Vietnam, and—while the Qing was in no position to challenge it—local Chinese rebel movements operating in northern Vietnam soon came into conflict with the French. When Paris took formal possession of the whole country in 1883, Qing forces entered from the north. There followed a somewhat confused war, in which French forces landed in Taiwan and on the Fujian coast, where they destroyed most of the newly built Chinese fleet. But given the tensions in European politics, France had to be careful not to be seen as challenging the position of other powers in China, first and foremost Britain. After having driven the Chinese forces out of Vietnam, the French commander attempted to enter Guangxi province, but a Qing counterattack in 1885 sent the invaders fleeing back to Hanoi. The defeat caused a major upheaval in French politics, forcing the resignation of prime minister Jules Ferry’s government, and even if the threat of further military action led Beijing to concede control of Indochina to the French, the Tonkin and Xinjiang campaigns told both Chinese and foreigners that even when weakened, the Qing could be a formidable opponent for any enemy.
IT WAS IN HONG KONG that the colonial experience in China was formed. Even though Shanghai from the late nineteenth century became more important both for trade and industry, it was in the great harbor at the mouth of the Pearl river that the pattern for hybrid Chinese-European societies would be set. The city served both as a depot and a refuge. It facilitated British trade all over southern China, while becoming, in terms of its population, a Chinese city, attracting immigrants from all over the country: refugees, dissidents, entrepreneurs, and fortune hunters. After having swallowed up a number of Chinese settlements across the bay in 1860, Hong Kong had a population of more than 120,000, of whom only 3,000 were non-Chinese.
Like all British colonial cities, Hong Kong was basically well-run, but somewhat shoddy at the edges, where corruption and exploitation thrived. It was a city founded on enormous paradoxes and hypocrisies. The foreign missionaries preached virtue to the Chinese while the foreign merchants kept them addicted to opium. The British preached law and order, though they had taken the territory by brute force. The Chinese came to Hong Kong to take advantage of the opportunities offered them in a city that was not theirs and bore the indignities of being second-class residents in a strict racial hierarchy in order to escape a world that was crumbling around them elsewhere in China. Over time, they built their own organizations, as the Chinese diaspora did elsewhere, even though the Hong Kongers had never left their own country.
The great trading houses stood at the center of foreign commercial activity in Hong Kong. Many of these companies—Jardine, Matheson, Butterfield & Swire, Hutchison—came out of British trade in India after the dissolution of the East India Company in 1834, and established a presence in many treaty ports in China. Still, they were nowhere more influential than in Hong Kong, where they not only ran the economy (and in effect also the politics) but also were the very raison d’être for the colony. From the beginning, these trading houses were international organizations, led by English (or in the case of Jardine’s, Scots) businessmen but staffed by Chinese, Indians, Europeans, and Americans. By the late nineteenth century, they were the main mediators between Chinese and foreigners, not only in Hong Kong, but all over China, not least because of their increasing control of the Chinese banking system.
It was not just Hong Kong’s economic opportunities that drew Chinese from all over but also its educational ones. To begin with, most of these were linked to the potential for economic gain. As elsewhere within Chinese societies, private schools were funded by families and organizations, but increasingly in the 1850s and 1860s, non-Chinese missions and foreign-run educational societies set up schools, too. Beginning in the 1870s, Hong Kong got a government-sponsored primary education system, which gradually expanded its enrollment among the Chinese. While to begin with, all of these schools emphasized Chinese classics, Bible study, and some English, from the late nineteenth century on they also made room for science. A teacher training college was set up in 1881, a medical school in 1887, and a university in 1910. For many Chinese parents, the relatively easy access to education in the colony became a massive argument in favor of entry into Hong Kong and contribution to its economy.
Hong Kong served as a convenient depot for British expansion in South China. But its economic role was—in the first hundred years of its existence—far inferior to that of the major foreign territorial concessions that were wrested from the Qing empire all over the country after the wars of the late nineteenth century. At the height of the system, just before World War I, there were forty-eight so-called treaty ports, where foreigners had the right to settle, conduct trade, and have extraterritoriality under their own consuls. In the main treaty ports, there were concessions or settlements that were almost entirely under foreign jurisdiction, with their own administrations usually answerable to a consul. This intricate system of exploitation produced micro-versions of informal empires within China. The concessions were almost entirely secured by blackmail: Most Western powers kept gunboats in Chinese waters and rarely hesitated to bombard Chinese cities if their conditions were not met. But some of the concessions became as important (and sometimes more so) for China and the Chinese as for their foreign inhabitants. And while unequal and oppressive in intent, they brought expanding concepts of Western law into China and helped globalize international law by attempting to regulate the multinational presence within the Qing empire.
There is a lot of nonsense about the role of the concessions that has been written both by Chinese and foreigners. Instead of a neat and tidy model created to subjugate China, the so-called treaty port system was an unwieldy, composite, and often unsuccessful response to events as they unfolded in the late nineteenth and early twentieth centuries. Most of the treaty ports and concessions played no role in furthering commerce. Some, such as the Italian concession in Tianjin, were set up for reasons of national pride by European powers that had almost no real connections with China; others were inhabited almost exclusively by Chinese, because foreign traders found it much more comfortable to live with their Chinese servants, lovers, and business companions outside the limits of Western jurisdiction. The ones that really mattered were the large concessions in Shanghai, Tianjin, Guangzhou, and Wuhan, with the German- and Russian-leased areas of Qingdao and Harbin as special cases. The different zones in these cities, whether Chinese-controlled or foreign-controlled, did much to create modern China, economically, culturally, and politically. With their complex systems of governance and social interaction, they provided the spaces in which the hybridity and fluidity of contemporary Chinese society were born.
Shanghai’s three sections—“international,” French, and Chinese—provided the concession city par excellence, the place where much of Chinese modernity was created. Built around an already thriving port, new Shanghai became, by World War I, a city of 1.3 million people. While a few among the foreign population, which never counted more than 40,000
people in total, governed the International Settlement and the French concession, both parts were in reality Chinese cities, with around a third of all Shanghailanders in the former and a tenth in the latter. The trading significance of Shanghai had been obvious for centuries. It was located at the mouth of the Yangzi, on the central coast, and the main tea- and silk-producing areas were within easy reach. But from the late nineteenth century, what really distinguished the city was its role as the country’s prime industrial center. It received more than half of all foreign investment into the country and became the place where the Chinese economy began to integrate and amalgamate foreign technologies, products, and tastes.
The first fifty years of concession life were bounded by foreign domination, but with Chinese providing the manpower that connected trade routes, provided supplies, and, increasingly, manned factories. While the Qing were struggling to break into the international system of independent, recognized states, and desperately trying to play the countries that harassed it off against each other, new kinds of societies emerged in some of the cities along China’s coast and on the great rivers. These were societies in which ideas and practices developed fast and gradually spread to the rest of China, on matters as diverse as street lighting and company stocks, waterpipes and religious creeds, shipyards and schooling. In business, foreigners and Chinese were linked together from the beginning. In daily life, interactions and observations gradually created much that was new for everyone.
WHILE FOREIGNERS CARVED OUT their parts of China’s cities, other newcomers to urban China were busy carving out theirs. From the mid-nineteenth to the early twentieth centuries, many Chinese cities doubled in size, as Qing restrictions on travel to and residence in the cities faded and more economic opportunities were created. The encounters between Chinese and foreign economies, products, and teachings were among the most important reasons for the urbanization of the late Qing era. But the decrease in official restrictions also played a role, especially for the growth in businesses, organizations, and learning that made the cities attractive. The young people who came to the cities, whether they settled in areas under Chinese or foreign jurisdiction, created new identities for themselves, as workers, traders, shopkeepers, or part of the intelligentsia, in ways that would not have been open to them had Qing power—with its skepticism toward unregulated cities—stayed intact.
The spectacle of change that met newcomers to Shanghai or Wuhan or Tianjin a hundred years ago would almost have been beyond their belief. It was not just the wide streets, trains and tramways, telegraph technology, movie houses, and dance halls that would have excited (and sometimes dismayed) them, it would be the way some people dressed—in skirts, blouses, and suits, rather than gowns—and how they lived—on their own, rather than with their families—that would have seemed odd and new. The presence of foreigners would of course titillate, as would the sights and smells of a new kind of city, in which production and transport were moving to the forefront of human consciousness. The new products for sale would also startle, from mirrors to soap, from bicycles to cameras, from corsets to flashlights. Sometimes they found their way into ancient cosmologies, as when mirrors were placed in hallways to ward off evil spirits. More often they were admired and, eventually, copied by local producers with twists that fitted local markets and tastes.
The role of the merchant had increased in urban China from the late fifteenth century on, but it took on a new significance in the late nineteenth century, when China was being drawn into an expanding world economy. The compradors (from the Portuguese word for “buyer”)—Chinese who acted as bicultural middlemen in the trade with foreigners—stood at the center of economic change that was taking place, acting as negotiators, business assistants, or upcountry purchasers for Western companies. Ironically, while it was their cultural skills, primarily in language, that gave them their comparative advantage, the compradors became agents of a new kind of economic rationality in the cities, where the accumulation of capital and the possession of material wealth became the main symbol of status. The Confucian context, in which honor, sincerity, and social relationships were as important as economic gain, was gradually outflanked, as was the position of scholars and even imperial officials.1
The Chinese cities of the late nineteenth and early twentieth centuries were chaotic places, both for old and new inhabitants. As the Qing, who had, with some justification, prided themselves on their city planning, began to lose control, new forms of authority emerged, in some cases building on precedents that had been set long ago. One such form in urban China was the huiguan or tongxianghui, the native place associations, which represented and assisted workers who came to the city from a particular area, province, or region. In places like Shanghai, Tianjin, and Wuhan, they controlled areas of the Chinese city in which their adherents lived, where their dialect was spoken, and where their sort of food was served. Crucially, they also provided contacts with countrymen abroad. But, while powerful, the native place associations always competed for allegiance with trade and labor organizations and with secret societies of various kinds, from anti-Qing agitators to criminal gangs and those somewhere on the scale in between. The new urban China was unruly territory, with complex links across time and geographical space, hard to control because it was so hard to define.2
IN 1832, A SCOTTISH SHIP DOCTOR, William Jardine, who had an extra income from dealing in opium, and his countryman James Matheson, set up what would become the premier foreign company, or hong, in nineteenth-century China. Jardine, Matheson & co. was primarily based in Hong Kong and Shanghai, with extensions through all the major trading routes within China, between China, Japan, and Southeast Asia, and between East Asia and Europe. It was in many ways China’s first multinational corporation, with a hybrid structure that was replicated in most other foreign-led hongs. Its board and directors were all foreigners, but the company was linked to Chinese compradors who served as conduits to the major Chinese producers and retailers and who in reality provided much of the capital on which the company’s business was based. Jardine’s had agents—mostly Europeans—in all major ports on the coast and along the main rivers, and these agents had their own network of Chinese merchants whom they depended upon to get business done. A company like Jardine’s of course existed mainly to provide the maximum profit for its foreign investors, symbolized by its involvement in the opium trade. But its structure became as much Chinese as European, and its business would have been impossible without the involvement of thousands of Chinese who led the way into markets and trade routes established long before any Scotsman had set foot in China.
One such area in which the European-led trading houses fitted into preexisting Chinese networks was in trade with and within Southeast Asia. In many cases the foreign companies simply slotted into trading structures that the Chinese diaspora had been building for many generations. The newcomers provided additional capital and stronger links with Europe. But while the Europeans were busy colonizing Southeast Asia between 1850 and 1914, the Chinese supplied the small traders and low-level administrators that glued the colonial possessions together. Singapore became the hub of the regional trade, and therefore a Chinese city in Southeast Asia, although under British administration. In Batavia (Jakarta) and Saigon (Ho Chi Minh City), Chinese traders provided key services for the Dutch and French colonialists, for foreign companies that settled in the area, and for companies operating out of China. Although both Southeast Asian elites and Europeans were fearful of Chinese influence and competition, they came to depend on the expanding markets that the Chinese helped set up. In British Malaya, for instance, Yu Ren Sheng—a company that began trading in Chinese medicine in the 1870s—came to link the peninsula to southern China on most things from banking services to food and contract labor.
The new Western-type banks, based in Shanghai and Hong Kong, also fitted into older Chinese patterns of credit and investment, forming great chains of finance. The links between various kinds of institutions were v
ery close, with loans and securities moving from big banks to small banks to new-type Chinese banks to old-type Chinese banks. The number of Chinese who were—in one form or another—affected by the activities of banks grew rapidly in the nineteenth century, even outside the cities. The banks were also, of course, linked to the trading houses, big and small. Jardine’s Fuzhou comprador sold, for instance, shares on behalf of the Hongkong and Shanghai Banking Corporation, the biggest of all the foreign-type institutions. HSBC had started operations from rented premises in Hong Kong in 1865, with a capital of five million Hong Kong dollars. By the 1880s, it was the biggest bank in China, with offices and agents all over the country. It was banker to the Hong Kong government for British government accounts in China, Japan, Malaya, and Singapore. It issued banknotes in Hong Kong and in Thailand. And most notably it was the banker to the Chinese government, managing most of its public loans between 1874 and the 1920s, making a substantial profit for its shareholders in the process.
Throughout the long period of wars and revolutions in China in the twentieth century, big foreign-run banks such as HSBC remained the preferred bankers for Chinese who gained from the capitalist expansion. While all foreign banks in China became more susceptible to risk after the collapse of the Qing empire in 1911, the romance between Western banking methods and Chinese capital continued to be strong. Ewen Cameron, the manager of HSBC’s Shanghai headquarters, in 1890 boasted that “for the last 25 years the Bank has been doing a very large business with the Chinese in Shanghai amounting, I should say, to hundreds of millions of taels [Chinese dollars], and we have never met with a defaulting Chinaman.”3
It was only in the early twentieth century that foreign involvement in Chinese industry started to catch up with foreign involvement in trade. One reason was that until the 1890s foreigners were not allowed to invest in production on Chinese soil. Another was Chinese resistance to the introduction of Western commercial law; it took up to 1904 before the concept of limited liability for corporations was accepted.4 The first Chinese industrial enterprises had developed out of existing companies, mostly in handicrafts. During the 1870s the Qing state and its provincial governments had begun forging links with private companies under the slogan guandu shangban (official supervision, merchant management) as part of the Self-strengthening Movement. Many of the enterprises that were created as part of such schemes—such as the China Merchant Steamship Navigation Company (founded in 1872), the Jiangnan Arsenal (1865), the Shanghai Cotton Cloth Mill (1878), and the Kaiping Mines (1877)—were based on Western technologies. But even though some of these new companies carried out quite amazing feats of reverse engineering to understand and produce foreign machinery, they found it hard to compete against Western-owned shipping and imports. From the turn of the century, foreign investment expanded rapidly, beginning in the mining industry, then in foodstuffs, energy, and textiles, with Shanghai the biggest center of production. Many of these businesses grew quickly and were highly profitable.