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The Formation of the Modern East Asian Economy
Secondly, as for the fate of the Chinese traders we have been discussing, they similarly have little doubt: the principal transporters, if not producers, of this foreign maritime trade in both northeast and southeast Asia remained Chinese merchants until the early twentieth century. The change would come when not Western but Japanese merchants and companies' command of industrial goods enabled them for the first time to dominate the transport routes and commodity markets throughout coastal East Asia. The predominance of the West would be most evident in the financial sphere, where it could greatly influence both countries, even if the Japanese, unlike the Chinese, greatly restricted the involvement of Western capital in their domestic manufacturing. Thus, late nineteenth century competition from within the traditional world of intra-Asian trade would end the 900-year-long Chinese domination of East Asian maritime trade, but even then not completely in all areas and sectors.

Claims for the continued strength of intra-Asian trade during this heyday of Western imperialism may well surprise those of us accustomed to thinking of nineteenth century trade being transformed from restricted tribute to free treaty port trade. Yet, as I have made clear in my earlier lectures, private trading was widely carried out by East and Southeast Asians among themselves within the traditional tribute system. Not only did some East Asian states carry out tribute relations with other states than China, but also Japan, Korea, and Vietnam all in their own way conceived of themselves running mini-Middle Kingdoms in relation to other states. Thus, the Western powers' opening of the ports, it needs to be remembered, opened up the port for not just themselves but also for traders from other Asian countries as well. In 1871, China and Japan agreed to conduct free trade with one another; in 1876, Japan and Korea reached a similar accord, and in 1882, so did China and Korea. For example, following the signing of the Treaty of Kanghwa in 1876, Japanese-Korean trade increased greatly. The total value of their trade at Pusan multiplied several fold during the second half of the 1870s, and the imminent opening of the port of Wonsan promised even more exchange of goods. The opening of this and other treaty ports stimulated intra-Asian trade, but did not necessarily represents a totally abrupt change in the trading relations.

Sughirara has compiled some useful statistics indicating the strength of this intra-Asian trade. From 1883 to 1913, the average annual rate of growth in the exports of Asia to the West (that is, Europe and North America) was 3.2%, a figure roughly the same as the average annual growth rate for all world trade during these three decades.

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