5

INTRODUCTION: ASIAN MERCHANT

COMMUNITIES ACROSS TIME AND SPACE
Madeleine Zelin
Tis is a volume that examines Asian merchant communities engaged in the
expanding global trade that saw the circulation of goods between northern and
southeast Asia and between this vast region and the Middle East, Europe and
the Americas. While some of the studies herein extend that examination to the
twentieth century, its main focus is the critical period of the seventeenth to the
nineteenth century, when inter-Asian trade was expanding under a logic of its
own and the encounter with Europeans was creating new opportunities and new
constraints for the diverse merchant communities it attracted. Much has been
written about the Europeans, their colonial regimes and the merchants who ben-
efted from monopolistic access to the new Asian market. Less is known about
the Asian merchant communities in this quintessential global marketplace.
Te authors whose work is gathered here have used the term community
not merely as a plural descriptive. In each of the studies in this volume the mer-
chants under consideration were connected in meaningful ways that structured
their business, promoted their interests and distinguished them from others,
contributing both to their personal and their commercial identities. Ascrip-
tive ties, such as kinship, native place and religion, not surprisingly, played an
important part in the creation of trust and commitment to collective problem-
solving institutions within all of these communities. However, we are reminded
that such mechanisms for the creation of solidarity are common among all
sojourning communities and not a characteristic of Asians that explains their
success or failure as economic actors. In each case study we have the opportu-
nity to examine how the resources supplied by ascriptive ties interacted with
a range of political, social and economic conditions that shaped business prac-
tices and business organization in the Asian region. Such data makes possible
more nuanced comparisons among Asian merchant communities and other
early modern commercial actors, as well as allowing us to gauge the role of these
resources as particular merchant communities encountered new conditions in
their sojourns across the region as a whole.
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6 Merchant Communities in Asia, 16001980
Almost all discussions of early modern merchant communities, particularly
those engaged in long-distance trade, alight at some point on the guild. Te
contribution of guilds to the success of merchants themselves and to the overall
processes of economic growth have long been a matter of debate among histo-
rians of both Asia and Europe . Two of the chapters in this volume focus special
attention on the diverse conditions under which guilds arose and the ways in
which this shaped their membership, functions and longevity under changing
economic conditions. Cho Young-Jun and Lee Hun-Chang provide one of two
chapters that examine the impact of changing market conditions in Korea . Teir
focus on shop merchants in large cities points to the far greater centralization of
economic activity in Chosn Korea than in either Europe or China . First estab-
lished by the state to procure goods for the court and for government of ces, the
shijn shops tended to be commodity specifc, and individual shops participated
in a variety of joint activities, including purchase and accounting. Cho and Lee
note that as the market, particularly in Seoul , expanded, shijn shops began to
organize in ways that would be familiar to students of merchants in other grow-
ing urban centres, providing protection against competition, mutual aid, dispute
mediation and so on. Te importance of monopoly privileges and continued
ties and ofen obligations to the state, however, gave these guilds particular
characteristics, including what appears to be far tighter hereditary control by
particular families and far less room for innovation than merchant solidarities
provided in other parts of Asia.
Te guilds described by Lin Yu-ju present a far diferent organizational
dynamic, despite sharing characteristics like mutual aid, dispute mediation and
solidarity built in part around worship of particular gods thought to protect
those engaged in commerce. While many of the migrants to Taiwan in the early
Qing came from Fujian , Lin demonstrates that the special conditions of the
cross-straits trade gave rise to organizational forms that drew on but by no means
mirrored those found on the mainland. Few limits were placed on the activi-
ties of merchants and producers beyond the restriction of trade to the Fujian
port of Xiamen and the Taiwan port of Luermen (near present-day Tainan ).
By the eighteenth century the expansion of that trade led to the proliferation
of frms exporting mainland manufactures to Taiwan and Taiwan agricultural
goods, especially sugar and rice , through Xiamen to Fujian and beyond. By the
nineteenth century likely around the 1760s these frms had already formed
a number of jiao , which, unlike the more familiar huiguan formed by merchants
throughout China and beyond, did not establish elaborate physical spaces,
were not limited to members from one place or one trade, and shared members
across associations and across the categories of stationary and import-export
merchants. At the same time, they benefted from corporate organizational tra-
ditions practised by temple and lineage associations; such traditions allowed
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Introduction 7
them to build social and political capital , solve common problems and satisfy
the religious needs of a growing merchant population.
One implication of Lins research is that the Chinese business model was a
fexible one, providing enduring resources for merchants in the changing eco-
nomic environment of early modern Asia. In Ishikawa Ryotas study of the
Chinese-Korean red ginseng trade we see evidence of this fexibility, as well as
some of the pitfalls of a changing regional trade regime as Westerners forced open
north Asian markets. Prior to the opening of Korea by Japan in 1876, Chinese
merchants had no more access to Korean markets than Westerners had to Chinese
markets. Much of the trade between China and Korea occurred as a component
of Koreas obligations to the Qing dynasty as a tribute state. Ishikawa provides
new evidence of the importance of Chinese merchant collaboration in making
the tribute system work. Focusing on the export of Korean red ginseng to China ,
Ishikawa demonstrates the persistence of a Korean bureaucratic trade model, born
of Koreas traditional reliance on commerce and grants of commercial privilege
as a source of state revenue. Chinese frms, versed in the establishment of branch
frms throughout China , had little dif culty moving into Seoul and other Korean
treaty ports . But many of the frms that took this step and the parties with whom
they transacted were carry-overs from the pre-treaty port regime.
If Chinese merchants in the Korean trade gained experience and entry
through the tribute trade and the merchants who dominated the trade across the
Taiwan straits benefted from proximity to the sole port open to this trade, how
should we understand the success of Chinese merchants who went further afeld?
Choi Chi-cheung provides an exploration of the Chinese merchant community
that came to dominate the Southeast Asian rice trade through the southern
Chinese port of Shantou. Chinese demand for imported rice , especially as key
rice-producing areas of eastern China turned increasingly to handicraf and
specialty production, is well known. Following Qing consolidation of southern
China and the lifing of its ban on coastal trade in the 1680s, trade links between
Southeast Asia and major ports along the southeast Chinese coast rapidly devel-
oped. Te Chaozhou traders discussed by Choi entered this trade frst as crew
on ships owned by earlier entrants, and recruiting of sailors contributed to the
native place character of many of the men who entered the Southeast Asian rice
market. Many of these men settled in Hong Kong or Southeast Asia, setting in
motion a reciprocal relationship between home area and areas of new settlement
as Chaozhou frms developed remittance businesses and shipped Chinese goods
to Southeast Asia and overseas Chinese returned home with newly developed
tastes for rice and other products from the maritime world. As we see in the case
of other Chinese long-distance traders in the nineteenth and twentieth century,
wholesale marketing ofen led to the development of what Choi calls vertical
trading networks. In the case of the Chen brothers of his study, this meant inte-
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8 Merchant Communities in Asia, 16001980
grating rice production and distribution from paddy to mill to local distribution
to wholesale export to China .
Lest we think that this pattern was uniquely Chinese, Stephanie Po-yin
Chung presents the fascinating story of the Alsagofs and Alkafs , traders from
the Hadhramaut region in Yemen . Like the Gujarati merchants discussed by
Ogawa Michihiro, and like many of the most famous domestic long-distance
merchants in China , the Alsagofs and Alkafs came from a region whose
harsh conditions drove them to seek their fortunes away from home. Like the
Chaozhou merchants, they maintained a strong sense of native place from their
humble beginnings as spice traders in the early to mid-nineteenth century to the
height of their business success and eventual decline in the second half of the
twentieth century. Kinship played a key role in their success, both as the source
of trusted personnel to run an increasingly diversifed business network , and as
a source of power alliances as sons and nephews married into prominent Malay
Muslim families. Beginning from bases in Singapore , at their height the Alsagofs
and Alkafs were engaged in shipping and retailing as well as land development
and their trade ranged from England to Arabia to Southeast Asia. While reli-
gion played an important role in their personal faith and identity, their ability
to proft from the growing number of Southeast Asian co-religionists eager to
make the Haj and to utilize institutions like the awaqf to preserve property as a
unit added unique elements to the familiar pattern of native place, kinship and
religion as sources of business trust, solidarity and profts.
Te story of the Alsagofs and Alkafs points to another common thread in
the histories of the merchant communities presented in this volume. If there is one
overriding message to be gleaned from these fne-tuned treatments of merchants
in Asia, it is that we have given far too much credit to culture and far too little
credit to politics in the evolution of Asian business. Many of the chapters in this
volume provide a window into the little-explored role of state policy and mer-
chantstate relations in shaping merchant behaviour and merchant success. Te
success of the Arab families in Singapore derived not only from their business acu-
men and their ability to win the trust of indigenous rulers through their common
commitment to Islam. Teir ability to move into the spice trade relied in great
measure on the decline of the Dutch monopoly over the spice trade, for which
they themselves could claim no credit. But their greatest good fortune came when
the British East India Company took control of the island now known as Singa-
pore and encouraged Arab settlement. British law made possible their investment
in landed property contrary to local Muslim practice, and fostered their primacy
among non-indigenous residents, including both Indians and Chinese.
Robert Hellyer and Evan Lampe both include Westerners among the com-
munities under consideration. Lampe presents a somewhat diferent case, not
of merchants but of the sailors who made their trade possible and presented fre-
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Introduction 9
quent challenges to order within the Western community. Hellyer looks at three
merchant communities in nineteenth-century Nagasaki , those of the Tokugawa
government s own clearing-house that directed the fow of imports and exports,
the regional merchants who represented or had loose af liations with the domains,
and Western traders, especially those from Britain . Like many contributors to this
volume, Hellyer is concerned with the way in which merchants operated within
the limitations and opportunities created by local politics. For merchants in Japan
in the 1860s this meant navigating a country in transition, plagued by rural and
urban uprisings, eforts to cope with a new foreign presence and increasing inter-
domain confict and competition. Hellyer traces the ways in which the fraught
politics of the late Tokugawa weakened shogunal control over trade and encour-
aged new roles and interactions among domain-based merchants, illustrating this
process with the example of the successful transition from domain merchant to
merchant prince of the founder of Mitsubishi , Iwasaki Yatar.
Both before and during periods of colonial rule, merchants played special
roles in sustaining indigenous administrative structures. Te Gujarati merchants
described by Ogawa extended loans and goods on credit, collected taxes and
served in many respects as bankers to the local governments of Indapur, as well as
directly participating in funding religious and cultural activities fundamental to
local social cohesion. Making themselves indispensable to local government was
thus key to their position as both local land developers and commercial inter-
mediaries between urban and rural sectors of Indapur. Tis position continued
under British colonial rule. Like their counterparts elsewhere they mitigated
their economic dominance by building social and cultural capital , funding local
festivals and increasingly becoming accepted into local social life.
Te smooth transition experienced by Gujarati merchants under British
colonial rule was not always possible as new Western overlords entered an exist-
ing market system. Te fate of Chinese merchants in the Philippines is evidence
of the hazards that could befall even the most fexible and adept merchant
community when they could not build such social capital . Tina S. Clemente
argues that Spanish administration of the Philippines could not have survived
without the fees and income from commerce generated by Chinese merchants.
Teir ability to act as the conduit for Spanish silver to China was founded on
the role that they played in keeping the colonial administration in Luzon afoat.
Tis was particularly so because the colonial rulers of the Philippines could not
rely on receipt of their share of subsidies from the Spanish administration in
Mexico. Nevertheless, the perception that the Chinese merchant community
posed a threat to the Spanish regime persisted. How important their resistance
to Christianity was to the Spanish view that they posed a dangerous presence is
dif cult to gauge. Clemente notes that late Spanish administrators also blamed
the Chinese for Spanish failure to develop closer ties to the indigenous popula-
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tion, evidence that here, as in other areas examined in this volume, merchant
intermediaries played a critical role in managing the relationship between colo-
nial rulers and local, ofen agrarian, populations.
Both Hellyer and Chung remind us that colonialism did not simply enact
European rule in distant lands. It also, ofen unintentionally, opened new spaces
for non-Europeans, who benefted from new property regimes, new technolo-
gies and new opportunities to bridge the gaps between indigenous populations
and the imperial regime. Nowhere is this more evident than in the dominant role
that Chinese merchants came to play in the territories beyond those studied by
these two authors. Kwee Hui Kian argues that we cannot simply attribute this
success to unique Chinese forms of merchant organization. As we have already
seen, they were neither unique nor always successful in the face of intractable
political hostility. Nor were the Chinese alone in their ability to create strong
ties to indigenous rulers. Chinese merchants in the seventeenth century were
operating within a multinational, multi-ethnic trading universe shared with
Europeans, as well as other Asians. Why then, by the eighteenth century, did the
Chinese succeed in dominating the Southeast Asian trade? Kwees answer lies in
the complex politics of Dutch colonial dominance and the unique position it
allowed the Chinese in the provisioning of the ever-increasing population, not
of Asians, but of Europeans engaged in the Southeast Asian trade.
Students of Asian business are ofen frustrated by the dif culties they face
when attempting to reconstruct the activities of merchants in Asian trade, par-
ticularly where political turmoil has resulted in the destruction of historical
records and where the absence of state involvement in registering and regulating
merchants has meant few public records of their activities survive. In addition
to their insights into the complex workings of Asian merchant communities,
the studies included herein stand as models of historical detective work, teas-
ing out the stories of these ofen hidden actors through tax records, contracts,
legal cases, stone inscriptions, commercial and political correspondence and
personal and public memoirs. Te rich details these sources provide let us fol-
low merchants from similar backgrounds as they move through difering spaces;
merchants from difering backgrounds as they cross each others paths; and the
varied communities of traders as they strove to deal with the rapidly changing
business environments of early modern East and Southeast Asia.
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