2024-03-26 05:56:11
2024-03-26 13:56 United News Network corner book selection On the left is John, the second generation of the Swire family who founded the Swire Group. Samuel. Swire; on the right is the current headquarter of Swire Group in Hong Kong…
▌The Swire Group and Modern China: The British business empire that prospered from “sugar” in Hong Kong
Few commodities shaped nineteenth-century history more than sugar.
The production, processing, trade and consumption of sugar shaped agriculture, commerce, international shipping networks, politics, diet and health. Sugar was once the focus of intensive technological research and development. Steam power and steel were crucial to the development of sugar in the early 19th century; however, blood, sweat, and slavery have always been entangled with sugar. The world of sugar was closely associated with the enslavement of Africans, African descendants, and others, and remains central to post-slavery economies and new forms of transportation that brought working people, especially from China, to plantations.
▌This article is“The Swire Group and Modern China: How did the British businessmen who sailed to China in the 19th century participate in the commercial zero-sum game? 》(Wheatfield, 2023) Book excerpt
SchweizerThe brothers grew up in a world filled with the wealth of Caribbean sugar refining and the boom in the sugar trade, which was the focus of their father’s business and once their exclusive specialty. Sugarcane is a well-adapted and commonly cultivated crop in the tropics, and uniquely, technological developments in Europe also enabled the extraction of sugar from beetroot, which grows in temperate climates. Sugar comes in many forms depending on the extraction process and the taste, habits and wealth of the consumer. Consumer tastes can change, dramatically and quickly.
Throughout the nineteenth century, per capita consumption of sugar increased, production increased, and prices fell. An elite conspicuous consumption product was reinvented and became a staple commodity in people’s diets. And, perhaps more than any other food, sugar has never been just a food.
Individuals, societies, economies and nations are bewitched by a sweet tyranny. Just as cotton production was dispersed around the globe during the American Civil War, sugar production is extremely sensitive to changes in global markets. A crisis in beetroot production occurred in Europe in the 1870s – France’s beetroot harvests failed in 1876 and 1877 – and the resulting European demand swallowed up Asian imports from Shantou, Java and India. sugar.
John. Samuel. Swire and Butterfield (Richard Shackleton Butt…
In order to respond to this demand,JardineHe took over Wahee, Smith & Co., a Chinese-owned sugar factory that had been operating in Hong Kong since 1868 (later China Sugar Refinery). By 1881, Chinese businessmen built a second sugar factory, the Lee Yuen Sugar Refinery (transliteration).The plants process mainly raw sugar shipped from Shantou on the eastern coast, where sugarcane fields are filled with sugar shipped from North China (on ships from Swire and other companies).cakeFertilize.
For a place like Hong Kong, two sugar refineries seemed to be enough – in fact, there were three sugar refineries in Hong Kong at one time, but due to lack of funds, the third one fell into the hands of Jardine Matheson. But as one Australian observer said in 1885, “The Swire & Company are now best known for their ‘plunge in’ policy”, which also made them “the giants of the Eastern Cape, with almost no presence on the coast of China”. Competitors in various undertakings,” commented an editorial in a Hong Kong newspaper. So Taikoo just fell into it.
The planning, financing and operation of the new sugar factory are a practical example of how the Swire Group operates, the changing nature of British business in China, and the ongoing evolution of the global economy. Since 1879,John.SamuelAfter asking McIntosh, a partner in Hong Kong, to research opportunities to open a sugar or insurance business, the plan took shape intermittently over the next two years.
“If we were to have a dispute with Jardine, and that seemed likely,” he wrote, “we would have to fight them on every front.” When the smoke was less intense, he acknowledged that rivals Their “established status, social and personal influence” may mean that their strength will only become stronger and stronger, and the number of agency projects in their investment portfolio will only increase. Nonetheless, “we should play the role of respected little brother” – silently focusing on the word “respected” – while exploring and dismissing options such as setting up a cotton textile factory or a shipyard in Hong Kong Afterwards, he decided to develop a sugar refinery.
In 1870, Taikoo & Co. opened a Hong Kong branch. The picture shows the Taikoo & Co. located at 1 Connaught Road, Central, Hong Kong in the 1900s…
Entering this industry requires land, water, efficient factory equipment, experienced employees, capital to run it all, working capital to obtain raw materials once production begins, a management structure and access to markets. It would be a complex and expensive commercial development, punctuated by setbacks.
In June 1881, John. Samuel wrote a handwritten letter to his circle of correspondents – mainly shareholders of Swire Shipping Company – enclosing a prospectus for the new venture and inviting them to invest. “We can obtain British capital for any company with outstanding results,” he had said earlier in 1881. The earnings and dividends of the Swire Shipping Company also fully proved that those who have “spare money” on their hands can greatly But they have “confidence” in him, waiting to receive a 10% return, and “enjoy prosperity” in their “twilight years”.
There are numerous records of “Old Dong” writing letters inviting friends and partners to invest in various ventures. Sometimes his invitations were very impolite. He would announce the results and praise or defend the taste and judgment of his tea masters and managers in China. force, then say that only a fool would refuse to invest and otherwise cajole or appease them.
Henry. Isaac. Butterfield, one of the most financially powerful in the network, was particularly wary of these invitations to invest. Prudence is a characteristic of the Butterfield family, John. Samuel thought to himself──Richard. Shakton. Butterfield’s ghost has always been with him–but he still wrote a letter to Isaac. Butterfield assured that, yes, his ship could be wrecked; yes, it was a risk; yes, the ship could be stolen by the captain, but this is called hijacking, and there are protections in place internationally. ; Or, if your ship kills a bishop or other prominent figure in an accident, Butterfield may personally be required to compensate due to “negligent liability,” but generally speaking, this liability is not a problem for shipowners.
After the collapse of Colley in 1875, which had an impact on the business, and the economic downturn of 1878/79, if Swire hoped that the channels for obtaining funds through this network could remain open and maintain the company and its His personal reputation is paramount.
The funds for the sugar factory are about to be in place, and the investors are all from the UK. The new company was formally established in June 1881. But Swire and his partners still knew nothing about sugar. By the time Swire Lines was founded, he had been investing in shipping or acting as an agent for other shipping companies for more than twenty years. Since he entered business in the 1840s, cotton merchandise has been the company’s main product.He has also accumulated enough knowledge about the Australian beverage market to be able to advise on new brands.porter stoutLorimer was advised, and while sugar had long been one of the company’s main imports, opening his own sugar factory was a completely different venture.
For this reason, John. Samuel once again called on the assistance of his network of partners and relatives.
The Taikoo Sugar Refinery under construction in 1882.Picture/Swire Group official website
Company in Hong Kongvictoria cityfive miles east ofQuarry BaySuitable land was bought, although the land price soared sharply at the last minute due to Jardine’s carefully planned manipulation. Quarry Bay was a rural area at that time, with only one road connected to the city. This road passed through the China Railway Sugar Bureau in the east corner and led to the military camp east of the port. This road feels very far away. In the past, when it was popular to go for a ride in a horse-drawn carriage, this was the farthest place that residents of Victoria City had traveled.
The land required filling, leveling, stabilizing the slope, and building an embankment on the port side.The photo shows the development of the site, with docks being built, foundations being laid, and a nine-story boiler house rising from the ground—in some ways, the tallest building in the colony at the time—fromgreenockA large amount of equipment has been shipped out and is being installed. “A magnificent building,” John. Samuel wrote, “Not a dime was wasted on decoration–simple and strong.” On March 17, 1884, when the sugar factory began operations, he was in Fuzhou, and Johnson of Jardine was there. It is in the colony of Hong Kong, and it is about to leave China where it has been for thirty-three years. Seeing relevant reports about his farewell speech and praising comments appearing on the same page as the news about the start of production at Taikoo Sugar Factory must be a stain before he left. “Everyone was surprised,” said John. Samuel said smugly, “Johnson originally estimated that it would take six years to complete the construction.”
Within three months, Johnson may have been laughing out loud. Just as the sugar mills began operations, world sugar prices plummeted. John. Samuel began to regret this business layout extremely. Internationally, only Havemeyers & Elder’s factory, which happened to be built in Brooklyn at the same time, surpassed the Taikoo Sugar Factory in terms of size and production capacity. This achievement and great relief was due to some difficulties encountered in the first two years of production. overshadowed by major issues.
In addition to unprecedented price slumps caused by overproduction in Europe and Asia, companies have encountered obstacles in finding markets, maintaining production quality, safeguarding employee welfare, and obtaining financing.
Then it was the young German chemist Ferdinand who came to save the Taikoo Sugar Factory. Heinrich. Dr Ferdinand Heinrich Korn. This person is not only talented, but more importantly, he brings a different kind of production thinking. “Science must take the lead,” McIntosh wrote Heinrich. Cohen brought science to Quarry Bay.
Dr. Cohen became the general manager of the sugar factory, gradually improving and stabilizing quality. The quality of the products was also tested and questioned in court due to a contract dispute in 1886. Soon, Chinese consumers, who were crucial to the sugar factory’s planning, also began to “buy in.” “At the outset,” McIntosh later wrote, “we actually had no idea…where to find existing markets for our products.” The challenge was that Chinese consumers were accustomed to eating food primarily from Shantou, China. Producers of various sugars. John. Samuel himself wrote in 1884, “We must now educate the Chinese to love refined sugar instead of rough sugar, and I fear this work will take time to complete.”
In fact, Chinese consumers are as ready to accept “modern” sugar as they are to travel on ships, ride onWusong Railway, use the telegraph, and accept other imported goods. Their culture is open. Sugar had an additional resonance with modernity that would become a unique element of Chinese consumer culture in the early twentieth century. Having a sweet tooth is very fashionable.
For producers, the price collapse of 1884 had a long-term, very positive impact on sugar consumption, because it brought industrially produced sugar to a wider public who could now afford it. It’s just that Chinese consumers are gradually turning away from non-industrially produced colored sugar and buying cheap “factory white” sugar, which is a product that is bleached rather than refined. This white sugar later became an acceptable substitute for refined sugar.
When the price of industrially produced white sugar fell, consumers were ready for a change: Low prices over the past two years “have opened up markets for sugar mills’ products that they had not been able to enter in the past,” McIntosh said. This “stigmatizes sugar that was previously consumed”. The new products of the new sugar factory and the connection between modernity and health have also increasingly promoted changes in consumption. White sugar is “pure” and is produced through hygienic industrial processes that are increasingly automated and reliable. To continue such production, “we must accept the chemist’s leadership and cooperate with him,” McIntosh wrote.
Swire Sugar was fully integrated into Swire’s shipping interests. Only the ships of the Taikoo Steam Navigation Company were authorized to carry the refined products of the sugar refinery… The Taikoo Sugar Refinery in operation in 1911.Picture/SOAS, University of London
Swire Sugar was fully integrated into Swire’s shipping interests. Only Swire Shipping Company’s ships are authorized to carry refined sugar refined by sugar refineries, and most of the raw materials are transported to Quarry Bay by Swire’s ships. The demand for soybean cakes to fertilize Javanese plantations that supply raw materials to Hong Kong refineries has also meant an increase in Swire Shipping’s turnover. Sugar was transported from Hong Kong to the north on a Taikoo ship that had just brought bean cakes south.
As an agent, Swire & Co. sells Swire Sugar Refinery’s products through branches in China and Japan – which is why the Yokohama office has not closed. Hong Kong’s Taikoo & Co. is the general agent of the sugar factory itself. Swire Group is a significant shareholder. Despite the daunting problems of providing operating capital (which forced the company to seek capital on a scale not previously seen in the past), despite market vagaries and competition from the sugar mills owned by Jardine Matheson, the Taikoo Sugar Refinery was established between 1884 and 1919. In ○○ years, it has created considerable and stable profits, and dividends totaling more than one million pounds.
And these are also new difficulties that the company has never encountered before. The same goes for the hardships posed by Chinese labor during and after factory construction. Because, Swire Group suddenly realized that the company employs more Chinese employees than British or any other nationality employees.
As the Liverpool network gradually lost its visibility in the Swire story, Swire became increasingly integrated into London. Shipping previously, and now the sugar industry, brought many Scottish employees to Swire. The company had Portuguese and Indian guards, Portuguese clerks and bookkeepers, and of course Dr. Cohen, who was only the first of many German employees to be recruited by Swire Sugar. However, the construction of the sugar factory opened up a new dimension for the company. The factory directly employed a large number of Chinese people, so this opened the stage for all kinds of new interactions, not all of which were pleasant.
First, the original building contractor underestimated the size of the business, and when McIntosh wanted to hire another person to replace him, the company faced resistance from his peers. Just like John. Samuel said, “The guilds prohibited us from doing the first large-scale project in China’s history.” He was referring to the history of British business development in China. The company responded by hiring workers directly, although a July 1883 court case concerning a mass strike showed that this did not make the problem better. But “the building was built in half the time,” John. And these workers were paid more, Samuel wrote, because they were employed directly by Taikoo Sugar and did not receive commissions from contractors.
Labor became a source of intermittent tensions. In 1886, Swire recruited 170 people from Shantou to work in the sugar factory. Considering the role of sugar production in the Shantou region’s economy, Swire may have assumed that they had some knowledge of the work of sugar factories. Unexpectedly, new problems arose. The 1880s saw the emergence of new phenomena in Sino-Oceanic interactions, notably the nationalist actions taken by workers and others in response to the Sino-French War of 1884/85, and the earlier French seizure of Tokyo (Tonkin, Note: historical place name, refers to the tension caused by northern Vietnam).
In September and October 1884, dockworkers and boatmen in Hong Kong boycotted French warships entering the harbor. At the request of the employer, the Magistrates’ Court imposed fines on workers who violated the contract, triggering demonstrations and violence among Chinese from all walks of life in Hong Kong. The Sino-Ocean conflict before 1884 was always accompanied by factors of Chinese mass mobilization, but the number of Qing people working for or supplying foreign forces was also similar. But when companies like Swire & Co. expanded into manufacturing as their business developed and expanded, manufacturing became a new arena of conflict, ushering in an era of boycotts and strikes.
As an agent, Swire & Co. sells Swire Sugar Refinery’s products through branches in China and Japan – this is the Yokohama office…
author:Robert Bickers
Translator:Ye Pincen
the publisher:Wheatfield Publishing
Publication date:2023/11/2
brief introduction:“The Swire Group and Modern China” completely records the Swire Group’s history, family lineage, business strategies, its achievements, difficulties, and its experience of wars, revolutions, and the ups and downs of the global economy. This outstanding corporate analysis not only provides incisive analysis, but also combines historical insights from all aspects: the company itself and its environment, modern China, the United Kingdom, and the wave of globalization that is always catching up, as well as the compradors, shipowners, and Eastern and Western businessmen involved , revolutionaries, pirates and business executives in Hong Kong during the British rule. Anyone interested in global trade must read “The Swire Group and Modern China”. It provides a history close to modern life and helps understand the economic and corporate forms of today’s Asia.
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