Western raining enterprise in China encountered problems similar to those found in the course of railway development. For both types of undertaking land and rights over its use had to be acquired outside the concessions. Where foreigners were involved and unfamiliar methods introduced the xenophobia of the local population was excited. Mechanised mining, whether by foreigners or by Chinese seduced by foreign example, offended against deep-seated traditions and beliefs, for it was held to disturb the natural balance of the elements. The risk that attended an investment in great specific capital projects was, moreover, augmented by the political insecurity of the country, especially by the weakness of the Central Government in the face of hostile or rapacious provincial authorities. Further, the successful operation of a mining enterprise always depends upon the existence of efficient carriage to a market, and since China lacked an adequate railway and canal system, those responsible for sinking the mines had also, as a rule, to concern themselves with introducing new means of transport. This extension of the physical area of operations increased the vulnerability of Western- owned undertakings. On the other hand, the more alert Chinese, both among officials and private business men, who were interested in modernising the mining industry, lacked capital and technical and administrative experience in operating modern undertakings.
These obstacles delayed the introduction of Western mining methods into China long after the great coal resources of the country had become widely known, and down to the end of our period they narrowly restricted the area of operations in China Proper. They were also the explanation why, after several false starts, coal-mining in China, in so far as it was successful, rested upon close co-operation between Chinese and foreign interests within the various operating concerns themselves. In other words, modern coal-mining was essentially a joint undertaking. This applies mainly to China Proper, for Manchuria, in this as in so many other respects, stands apart. There the development of the coal resources was largely controlled by foreigners, and after 1932 it became an integral part of the great industrial expansion fostered by Japan and so is to be regarded as a part of Japan's rather than of China's economic history.
Interest in the means employed for modernising China's coal industry must not be allowed to obscure the fact that even in the middle thirties