The commercial prospects of Korea—Openings to
trade—Requirements of markets—Lack of British enterprise
The trade returns for 1900 exceeded every previous year. During the
period covered by the Boxer disturbances, however, the Korean exports
to China decreased, and the importation of foreign goods likewise fell
off. The stimulus given to the cereal trade, by the interruption of
the Manchurian export bean trade from Newchang, and by the demand for
food-supplies for the troops in China, more than counterbalanced this
temporary decline in direct native exports and direct foreign imports.
Cotton goods, however, show an increase of £14,297 over the figures of
previous years; but there is a specific falling off in imports of British
manufacture and origin, and a specific advance in the more important
lines of Japanese goods. I append a small table revealing the comparative
prosperity of British and Japanese trade at this date:
English, decrease in: Japanese, increase in:
Shirtings £59,069 Shirtings £1,731
Indian Yarn £3,056 Yarn £11,329
Sheetings and other Sheetings £40,422
pieces Small decrease Other piece goods £25,676
In time, the markets of Japan will produce everything which at present
comes from America in the shape of canned goods, and from Europe, in the
form of textiles or food-stuffs. Japanese woven fabrics, and canned foods
of inferior quality are driving the wholesale manufacturing houses of
England and America from the markets. At present, therefore, the trade
of Korea is limited as much by the capacity of the Japanese markets as
by the wants of the Korean. In face of the opposition of the Japanese,
their determination to retain the Korean markets for themselves, and the
absence of effective attempts by Western houses to beat up such trade
as may exist, it is difficult to believe that the future will show any
material expansion in the capacity of the foreign trade.
Nevertheless, Korea provides a fair field for capital. It would be quite
possible to improve the condition of foreign trade, if merchants could
arrange to protect their interests by establishing their own agencies
in the country, under competent and energetic European management.
When British merchants depart from their apathetic indifference and
organise an exhaustive expert inquiry into the capabilities of the
Korean trade, their trouble will be quickly rewarded. New markets
require new commodities, the demand for which any technical inspection
of the requirements of the people will disclose. Until this examination
takes place, however, the stagnation in British trade must continue.
Korea offers to British interests an interesting field in which the
development of new industries must be conducted upon practical lines.
Briefly, the imports in demand are those which are necessary to meet the
requirements of an agricultural country whose mining resources are in
process of development and whose railway system is as yet in its early
stages. The increase in the importation of mining supplies supports
this contention. Bags and ropes for packing, machinery for agricultural
and mining purposes, and sewing machines are in greater demand. Railway
material is, of course, wanted. The new industries may not be upon a
large scale. Primitive methods doubtless will continue for the most part
to govern native manufactures such as grass cloth, straw mats, ropes, &c.
Excellent paper has been made since the replacement of the use of native
lye by caustic soda and soda-ash, while the innovation is one to which
the people have taken kindly enough. Again, while the paper industry is
capable of expansion, a brisk business in leather could be built up in
the country. Hides, which are exported to Japan in their raw state, are
abundant, and might be converted into leather so easily on the spot. The
straw braid industry contains great possibilities, while the climate of
Korea is naturally suited to the growth and treatment of silk.
Many things would be necessary to the success of such enterprises. The
work must be based upon a knowledge of the country and its language.
The manufacturer or the merchant must take the pains to accommodate
a direct import trade to the exigencies of the local market. As an
example, smaller bales and shorter lengths are requisite in the piece
goods. The establishment of sample warehouses at the treaty ports, and
in the more important trade-centres of the interior, where bales of
shirting, cotton and woollen goods, cases of farming implements, &c.,
could be opened and sold for cash, would appeal to the natives. This
departure would avoid the increase in the prime cost of the articles
necessitated by the existing system of transhipment. At present, goods
come from Shanghai to Chi-fu and thence to Chemulpo. They pass then
from the importer to the Chinese merchants, and from them to the Korean
wholesale buyers; these resell them in greatly diminished quantities to
the pedlars and agents, who retail the goods. It would also be advisable
to create consular agencies in Fusan and Won-san. Official representation
at present is confined to an underpaid and understaffed Legation in
Seoul, and a vice-consulate in Chemulpo. Additional _employés_ should be
interchangeable, undertaking either the vice-consular duties of the ports
or the secretarial services of the Legation.
The bulk of the imports and exports, which pass through the Customs,
comes from China and Japan. The means of transport are controlled by
Japanese; the export trade of the country is entirely in their hands.
This fact alone should appeal to British shipping interests and to
ship-owners. Unfortunately, many years of prosperity have brought
about great changes in the spirit of our nation, and we no longer show
the enterprise and initiative which formerly distinguished us. This
depreciation in the forces of the nation has promoted a corresponding
depression in our trade. We are no longer the pioneers of commerce;
nor have we the capacity and courage of our forefathers who fostered
those interests of which we are now so neglectful in every quarter of
the globe. At the dawn of the twentieth century, it is amazing to find
a country, with a total foreign import and export trade exceeding two
millions and a half sterling for the year 1901 and two millions and
three quarters sterling for the year 1902, whose shores were visited by
over ten thousand steam and sailing trading-vessels in the same period,
registering an aggregate tonnage of more than two million tons, almost
untouched by British merchantmen. Deplorable as this may be, statistics
which Mr. McLeavy Brown has drawn up show that one steamship, chartered
by Chinese and floating the British flag, entered Korean waters in
1900; that four steamers came in each of the years 1901-2, a return
which reveals a steady decline upon the previous years. Since Korea was
opened to trade in 1880, British shipping has visited the country in
the proportion of 1377 tons to every two years. Despite appeals from
our Consuls in Korea to British steamship companies improvement has
been impossible; since no response was evoked by their efforts, and no
service has been established. The consequence of this is that a valuable
opportunity has been allowed to escape, the Japanese profiting by our
indifference.
The trade of Korea is increasing gradually. A steamer, which could make
periodical calls between Shanghai and Won-san, Yokohama and Vladivostock,
taking cargo and passengers to the open ports of Korea, and touching at
Japan upon the journey back, would return good money upon the venture.
British and Chinese merchants would prefer to ship in a British vessel.
The old-fashioned traditions of the British mercantile service, as to
punctuality and despatch, are not carried out by the steamers of the
Nippon Yusen Kaisha and the Osaka Shosen Kaisha, which call at the ports
in Korea. It is almost impossible to know when the steamers of these
companies will arrive or when they will leave. Little attempt is made
to observe their schedule. The condition of the vessels of the latter
company accredited to the Korean run is filthy. Moreover, this company
is careless of cargo, and quite indifferent to the comforts of its
passengers. The Nippon Yusen Kaisha certainly supplies meals in foreign
style, but the Osaka Shosen Kaisha provides nothing. Plying between
Japan, China and Korea, this company declines to make any arrangements
for foreigners in the matter of food or accommodation. One experience
is enough. Unfortunately, foreigners are compelled to travel in them,
as the steamers of one or other of the two companies are usually the
sole means of communication between those countries and Korea. There is
cargo and passenger traffic for any company that will organise a regular
steam-service. The profits might be small at first, since the Japanese
prefer to endure their own steamers and to ship under their own flag;
but there are signs that the flourishing condition of the trade of the
country would bring ultimate success.
The establishment of a steamer-service, if only of one or two steamers,
is not the sole hazard by which Japanese competition might be faced.
The climate of Korea is peculiarly suited to fruit-culture. If this
work were taken in hand, the fruit might be tinned or exported fresh
to China, where it would find a ready sale. The fertility of the soil
near Won-san and the abundance of fish in the sea off that part of the
coast, would make that port a suitable export centre for the creation
of a fish and fruit-canning industry under foreign management. Fish and
fruit industries of this description in Japan are profitable and very
bad. Nevertheless, their output is widely distributed over the Far East.
The initiation of these industrial ventures would require some time, for
many difficulties oppress foreigners, who are anxious to put capital
into Korea. In the end, a modest venture would reap sufficient success
to justify the speculation, while the returns would probably permit
an immediate expansion of the enterprise. There is no doubt about the
fish; there is no doubt about the fruit; but whatever investment of an
industrial character is made in Korea, close and high-class technical
supervision is the necessary accompaniment.
The British merchant in the Far East is the first to condemn his own
Minister and to abuse his own Consul, and he is the very last to help
himself. It may be, however, that the follies of the Imperial Government,
the unreasoning prejudices and foolish blundering of the Foreign Office,
have created this apathy. The drifting and vacuous policy of Lord
Salisbury made it impossible to avert the decay of our prestige and trade
which has set in throughout the Far East. Official returns establish only
too completely the unhappy predicament in which trade and merchants alike
are placed. There is a general decrease in the volume of the one, and
there has been no sympathetic activity among those engaged in commercial
interests elsewhere to set against it. The deficiency is almost without
solution, so long as bounty-fed manufactures, carried in subsidised
bottoms, are set against the products of an unassisted trade. Competition
is increasing, and foreign manufacturers are themselves now meeting the
requirements of the markets of China. There is little prospect in the
future of the restoration of our former commercial superiority. Much
might be attempted, although it seems almost as if the British merchant
were so bent upon his own damnation, that little could be done.
The decline of British trade cannot be attributed in any way to the late
disturbances in North China, to the decline in the purchasing power of
the dollar, or to the temporary rise in the market prices. Japan has
become our most formidable competitor. The decrease in our trade is due
entirely to the commercial development and rise of Japan, who, together
with America, has successfully taken from us markets in which, prior
to their appearance, British goods were supreme. The gravity of the
situation in which British trade is placed cannot be lightly regarded. We
still lay claim to the carrying trade of the Far East; but the figures,
which support our pre-eminence in this direction are totally unreliable.
If the true conditions were made manifest, it would be seen that so far
from leading the shipping of the world in the Far East, Great Britain
could claim but a small proportion of the freights carried. Although
we may own the ships, neither our markets nor our manufactures are
associated with their cargoes. It would be well if the public could grasp
this feature of the China trade. Members of Parliament, ignorant of the
deductions which are necessary before claiming the carrying trade of the
Far East—much less of the Yang-tse and of the China coast—as an asset in
our commercial prosperity, and a sign of vigour of the first magnitude,
do not recognise how unsubstantial is the travesty of affluence which
they so constantly applaud.
[Illustration: BRICK LAYING EXTRAORDINARY]
During 1901, owing to the Boxer disturbance, large numbers of ships owned
by natives were transferred to the British flag. The ostensible decrease
in the tonnage of British vessels, which entered and cleared affected
ports, was therefore less than that of other nationalities. Similarly,
there was a small increase in the duties paid under the British flag
during the same period, owing to the valuable character of these cargoes.
Under ordinary circumstances, the comparatively small decrease in the
British tonnage and the increase of more than fifty thousand taels in
the payments made to the Imperial Customs at such a moment of unrest,
would suggest the stability of our trading interest, and afford no mean
standard by which to judge the capacity of the markets. Unfortunately,
the two most important counts in the returns, tonnage and duties, are
no criterion. It is necessary to inspect closely the individual values
of the different articles comprising the total trade. In this way the
general depreciation of our manufactures is at once apparent.
A comparison of the American, Japanese, and German returns shows which
are the commercial activities that are threatening our existence as a
factor in the markets of the Far East. If, in the returns, we were shown
the relations between the duties paid under each flag, and the tonnage of
any particular country, besides the source and destination of its cargo,
the true condition of British trade would be revealed at a glance. As
it is, until a table is added to the Maritime Report, which will supply
this valuable and interesting demonstration, the system of a separate
examination is alone to be relied upon. By this method we find that
between the years 1891 and 1901 there was a consistent falling-off in
British exports to the Far East in almost every commodity in which the
competition of America, Japan, and Germany was possible. Since 1895, when
Japan began to assert herself in the markets of China, those articles
which, pre-eminently among the commercial Powers, she can herself supply,
have carried everything before them. Ten years ago the British trade
in cloths, drills, shirtings, cottons, yarns, and matches had attained
magnificent dimensions. In certain particulars, only, our trade was
rivalled by the United States of America, whose propinquity gave to them
some little advantage in the markets of the Far East. Now, however, the
trade has passed altogether into the hands of the Japanese, or is so
equally divided between Japan and America, Japan and Germany, that our
pristine supremacy has disappeared.