Academic journal article Canadian Social Science

Railway Finance and National Credit: A Study of Chengdu-Hankou Railway Protect Crisis as a Center

Academic journal article Canadian Social Science

Railway Finance and National Credit: A Study of Chengdu-Hankou Railway Protect Crisis as a Center

Article excerpt

Abstract

The Revolution of 1911 leading to the collapse of the Qing Dynasty started with the Railway Project Crisis (1911, May) in Sichuan Province, the studies of which have focused on the political and economic game of railway project and reserved capital between both factions, i.e. constitutionalist and revolutionaries, and the Qing Government, but there are a few of researches from the financial point of view, especially, from the perspective of national financial credit as the starting point. In the final analysis, the game interaction between national capital and private capital aims to control the railway monopoly resources. The awakening of national self-awareness of rights, the struggle of local-central power and profits segmentation as well as the magnification of the consciousness of ethnic group all were connected through the new thing of railway finance. The join force from each faction was formed under the private capital financing, with the slogan of breaking the agreements and railway project protection, the vested interest groups were attacked under the shelter of state-owned capital. Because of the private capital financing network represented by the stock by rent extraction, the struggle was abnormally fierce and tough. Construction of railway via foreign debts, in fact, originated from Zhang Zhidong, who referred to the German and Japanese experiences of construction of railway via foreign debts, with the purpose of retaining our sovereignty. That can be seen from his repetition in his memorial. Sheng Xuanhuai, a trader directly inheriting the cause, knew the nature and rights of private capital unclearly. Especially, he nationalized the special financial capital, i.e. Sichuan people's stock by rent extraction in the simple and crude way, and lacked of in-depth understanding and macroscopic view. Even so, from the perspective of actual long-term rights and interests of the shareholders, the railway state-owned policy by the Qing Government is similar to the policy of original merchant-operated railway. The problem is that at point, the Qing Government lost credit because of fake constitutionalism in politics and Zhaoxin stock bankruptcy in economics, but applied the foreign railway financial form mechanically to the Chengdu-Hankou railway with loss of political and economic credit. In the face of the private financial groups in the tight-knit network as well as the fierce and persistent struggle, it is no wonder that the Qing Government had ineffable surprise . The historical event enlightened that: the form of railway finance is not confined to the state-owned or private-owned or government-merchant joint management forms, the key is that the government providing the stateowned capital should have enough credit in politics and economics, fully consider the benefits of private capital, and give necessary attention and response to reasonable political demands. In this sense, undoubtedly, the credit is the first importance for railway finance with long earning cycle.

Key words: Railway finance; Chengdu; Hankou Railway protect crisis; Private capital; National credit

BACKGROUND AND ORIGIN OF

After Sino-Japanese War of 1894-1895, the foreign powers competed for "spheres of influence" in China, plundering the sovereignty of Chinese railway. In the eyes of the foreign powers, Sichuan Province is abundant in natural resources and populous, and is a wide place where they dumped the goods and exported the capital. At that time, the foreign powers were eager to open the railway channels entering into Sichuan Province from two directions. The first direction is from the south of Burma and Vietnam via Yunnan Province to Sichuan Province. After taking the building rights of Yunnan-Burma railway and Yunnan-Vietnam railway respectively, Britain and France attempted in vain to extend the railway to Chengdu and Chongqing of Sichuan Province, and then connected it to the railways in the Yangtze River Basin. …

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