Evening star., 1900-08-17
CHINESE FOREIGN TRADE
ITS DIRECTION DEPENDENT UPON
EMPIRES COMMERCIAL CLASSES.
Characteristics Of the Chinese Mer-
chants-Their integrity and Honor
Mutual Confidence.

| The future of China's foreign trade, accord
| ing to the belief of recent writer is largely
| in the hands of native merchants. British en-
| terprise. he goes on to say, may be directed
| to the development of the Chinese empire S
resources, but the question of who is going
| to ultimately benefit thereby is dependent
| to a great extent upon the foresight and
sagacity of the commercial classes in China.
The privately expressed conviction of one
of the most experienced and enterprisng of
English merchants living in the heart of
the country is that all the benefit of de-
| veloping China's trade and resources will,
ultimately pass into the pockets of the
Chinese themselves. The native merchants
exercise In reality power which is quite
| unexampled in Europe. Their action in
commercial matters is unhindered by the
central government. In fact they may be
said with perfect truth TO largely control
local administration, and it is generally by
their sanction alone that any mercantile
disputes are brought before the public tri-
bunals. These welghty powers are not. of
course, welded by individuals, but result
from the formation of great trade combi-
nations. Noting the chief characteristics
of the Chinese merchant and how he may
individually stand in comparison with his
European competitor, Prof. r. h. Douglas,
whose opinion is based upon the deep in
sight afforded by c.ose personal relations
wnen III the consular service, SAYS the
merchants and traders of China have gain
ed the respect and won the admiration of
all those who have been brought into con-
tact with them. For honesty and integrity
they have earned universal praise, and on
this point a Shanghai bank manager in
lately acknowledging a valedctory address
presented to him on his leaving the country,
bore the following testimony: Il have" he
said, referred to the high commercial
standing of the foreign community The
Chinese are in no way behind us in that re-
spect. In fact, / know of people in the
world would sooner trust that the Chinese
merchant and banker. l may mention that
for the last twenty-five years the bank
has been doing a very large business with
Chinese at Shanghai, amounting, / should
say, to hundreds of millions of taels and
we have never yet met with defaulting
Chinaman. 1t was such men as these that
built up the commerce which excited the
wonder and admiration of Marco Paulo and
other early European travellers, and IL is
to their labors and those of their descend
ants that the crowded markets, the teem-
ing wharves and the richly laden vessels of
the present day are due"
Written Contracts Seldom Needed.
The integrity of the Chinese merchants
could not be better exemplified than in the
fact that even In the largest transactions
written contracts are seldom required Bus
mess, involving the risk of enormous sums
is conducted on the basis of purely verbal
agreements, and ii is not only rare for a
native merchant to fail in his engagements
but his defalcation would bring upon him
the infiiction of the severest penalty by the
corporation of which he was member
In Europe it is related with bated breath
instance of the most extraordinary
and unprecedented commercial probity, that
during the war of 1871 the Rothschilds IN
the beleaguered city of Paris conducted
their business with the outside world
through the medium of carrier pigeons en-
tirely a system of trust.
1t is considered by us a remarkable thing
to enter into relations with even the most
solvent and world-famed firm without
proper written security. There would be
nothing out of the way in this country for
a man to demand a receipt in black and
white from his own brother. To the
Chinese this is incomprehensible. mer-
chants word Is all that is needed in the
weightiest transactions, and although there
are exceptional cases in which documen-
tary warranty is required as, for instance
where Shansi bank makes an advance to
a trader on the security of the written
guarantee of another banker. verbal agree
ments are the most reputable and common
place method Of doing business.
Strict Is a mild word to apply to the
severe measures which are taken by ShansI
bankers in order to insure the fidelity Of
their employees. When one of the latter is
sent out from the head off1ce to manage a
branch his family Is held in pawn at head