Western Enterprise in Far Eastern Economic Development: China and Japan

By G. C. Allen; Audrey G. Donnithorne | Go to book overview

CHAPTER VIII RAILWAYS, CIVIL AVIATION AND PUBLIC UTILITIES

1. Railways

The great industrial and commercial development of the Western world during the nineteenth century was made possible by the contemporaneous improvements in transport, for in the absence of steamships and railways very narrow limits would have been set to the growth of specialised areas of raw-material production and of large-scale manufacturing industry. Railway transport was of special importance in the great continental land masses and, with the experience of the economic expansion of Europe and America, it was natural that foreigners concerned with China's trade should soon realise that without cheap internal transport the vast hinterland could never be brought within the orbit of the modern economic system. As we have seen, the long waterways offered certain opportunities which were not neglected; but there were huge areas of China which could be opened up only by improved methods of land transport, and in the nineteenth century this meant railways.

Railway construction in China raised a new set of problems for foreign enterprise. This was to be expected, for even in the Western countries the construction and operation of railways had given rise to novel issues of economic policy. In the first place, railway construction in China was only feasible if capital as well as expertise could be provided by the foreigners, and when a large fixed investment of this character was involved the Chinese Government had perforce to abandon its traditional aloofness. Secondly, the means by which the land needed for the lines could be acquired raised awkward questions, for there were complications caused by the status of the foreigner in China and by the conditions under which his economic activities were conducted. The treaties gave him various privileges, such as the right to create trading and residential centres from which his commercial enterprises might radiate, the right to travel in the interior, and the right to operate craft on the rivers; but before a railway system could be constructed those who built the lines had to acquire strips of land across the face of the country. Whereas trade had meant merely the formation of a few compact foreign enclaves, railways often meant the creation of extensive foreign zones of control. Not unnaturally the Chinese were suspicious of this extension of foreign privileges and influence, and when

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