Silver, tea and opium

The "lure of Asia", the commodity trade along the China coast in the early 19th century and the economic and political consequences of this. This is the history of three commodities, a money, a drink and a drug and the way they intersect in the South China Sea. This saw the emergence of the first modern war (Britain against China - The Opium War) and the emergence of the first joint stock companies.

The lure of Asia

The strength and vitality of long-established Asian trading networks created integrated and sophisticated systems of intra- and inter-regional trade. Asian trade was of a cosmopolitan nature: there was a diverse ethnic and religious mix amongst trading communities and until the 18th century, Europeans were mostly marginal players. They found it hard to move in and profit because of the long established trade networks in place already, and so having an impact in the region was a very gradual process. Portugal attempted to move in by force but were only able to establish a few ports on the periphery of the network and therefore did not infiltrate as they wanted. The Dutch and the English apporached it differently, taking an economic perspective. This saw the rise of Joint Stock Companies (private merchants pooling their resources) - the English East India Company was founded in 1600 and in 1602 the Dutch East India Company was founded. In 1757 the British took over control of Bengal and this marked a shift from trade to colonization. This initiated profound transformation of Asia-European trade, except for in East Asia, which still remained outside of the European presence. There was a fracturing of old networks, which was particularly dramatic in South Asia and South East Asia.

Unfortunately most of what the Europeans wanted came from China, where they could make little or no headway. They were forced to buy goods with silver, which increasingly became too expensive. While European states began to have a significant impact in South and Southeast Asia from the late 18th century onwards, East Asia remained beyond their influence. So in 1793, there was a British mission to China where Lord Macartney met with Emperor Qianlong and tried to persuade him to buy British woollen goods. However they had better stuff themselves and more of it so the Qing court refused greater access to China for European merchants, who remained confined to the biannual trade fares in Canton, on Chinese terms. From 1760 Chinese required all foreign trade to go through port of Canton only. With trade confined to Canton, the British still had little to sell to the Chinese, who continued to demand silver.

The Chinese demand for silver

The Chinese demand for silver was related to monetary, fiscal and commercial factors. It used as currency and in the payment of taxes and was in great demand due to the massive domestic economic growth from the late 15th century onwards. But China produced little silver, and thus relied on foreign sources of supply, usually from Japan and Spanish America.

The Tea trade

There were several routes of tea tradte, usually either overland through Russia where it was packaged as bricks and sent in Russian caravans, or over the ocean sent out of Canton packaged as leaves. English tea consumption increased a great deal over a relatively short period of time, fueling demand:

1664 2 lbs consumed

1783 5.8 million lbs consumed

1830s 30 million lbs consumed

There was a sociology of tea consumption. Up until 1720, Tea was consumed for mostly medicinal purposes. By the 1720s to about 1800, it was a symbol of social accomplishment, especially for females in high culture. They drunk green tea and even had tea rooms created for the consumption of tea. From the 1800s onwards, it was foodstuff, dominant in working class culture. From high culture, it had become part of popular culture, especially in the industrialising towns where it became a meal substitute. Here they usually drank black tea with milk and sugar.

The Opium trade

The English had to find something to pay the chinese for their tea. Opium had been taken for a very long time, and was not just an "Oriental Vice", also widely consumed in the west. It was used for all sorts of things, including soothing syrup for children. Originally it had come to China overland from the Islamic world. As with team, there was a sociology of opium consumption. At first it was medicinal (helped against dysentry (the "shits")), then was used as a food substitute (wasn't a major part of a workers daily life), then became a social accomplishment, and then as consumption increased, addiction became pronounced. The British forced the North Indians to grow poppy in order that they may meet their tax obligations. This poppy was used for making opium and sending to China, where huge profits could be made.

Opium imports to China:

1770s approx. 1,000 chests

1820s approx. 12,000

1830s approx. 30,000

1840s approx. 40,000

By the mid 1820s more silver was flowing out of China to pay for opium than flowed in to pay for tea, silks and ceramics. This generated social unrest and the authority of the state was challenged within China. Even though the import of opium was illegal, the british sold it to Chinese merchants in the South China Sea to get around this. Finally the Chinese had had enough and confiscated a very large amount of opium and dumped it into the sea (rather than buring it). This caused the British to go to war with China - The Opium War. There were sporadic conflicts between 1840 and 1842, and in 1842, the treaty of Nanjing was made. The Treaty of Nanjing changed the nature of the European impact in East Asia. But China, Japan and Korea were not colonized by European states, nor politically subordinated.