“Some men’s faces are as good as a credit slip.”

It will be perceived that they had a Franklin in China!

The idiom for a lunar eclipse is: “The moon has suffered a deficit,” but the other expression of the Chinese astronomers: “All round again”, indicates that losses have been underwritten and solvency reestablished! May the international financial astrologers in and out of China soon bring in this happy state. Then a “cycle of Cathay” will be as good as any other cycle, despite Tennyson’s dictum, and this will redound to the good of every nation, particularly America and Britain.

V
BUSINESS METHODS OF FOREIGNERS IN CHINA

The British national board of trade, partly on the advice in Admiral Lord Beresford’s book, has appointed commercial attachés separate from the diplomatic and consular bodies to work as specialists and free lances in China. In contrast with the diplomatic and consular departments, they are free to use the helpful publicity of the home newspapers in order to correct and create interest. Canada in a small way has followed Britain’s example. A consular officer is fixed to his post on account of his daily relationship with shipping, courts, visits of nationals, emigration and health inspection. A commercial attaché has more of a roving and special commission, and it is important in the nature of his office that his advice should be followed promptly in China and at home. He is in a position to strike quickly and bring trade to his flag. He is not necessarily that loathsome being which flourished in China previous to the Russo-Japanese War, a concession hunter and a looter of weak countries. His aim is to strengthen weak countries, as he knows that only a rich and contented people can trade richly with his flag. The more he is of a scholar, gentleman and Christian the better, for such a person in the long run makes an ideal trader and patriot, as the American reformers are insisting. He should be a statistician, an economist, and also an idealist, so that he may be able to formulate a policy amid the present confused conditions. He is not in any sense a historian, for he is not to follow his country. He is to lead it, and, moreover, he must also sympathize with the Chinese point of view to a sufficient degree.

Europe and America have been trading in China on an extended scale since in 1842 the Nanking Treaty opened up Canton and four other ports. Surprisingly few traders have learned the language. The home-rule principle has been recognized, and the Chinese have been allowed to run the trade in their own way on the compradore and shroff system. The foreign firm takes into its employ at a percentage, with a guaranteed minimum, a Chinese compradore, who speaks English, and who is bonded by the Chinese, and the compradore takes into his employ a shroff cashier, who is bonded to him by Chinese. The compradore pays the wages of his Chinese staff. The foreigner (Si Yang Jin—West Sea people) must deal with the Chinese customers only through the compradore, and the compradore must under no circumstances appeal to the head of the foreign firm in London, San Francisco, etc. He must deal with the agent or branch in the China port, in whose office he is located on the first floor, with a Chinese staff as large as the foreign staff up-stairs. One who enters the offices of the Pacific Mail, American (International) Bank, Standard Oil, P. & O., Butterfield and Swire, Jardine’s, Fearon’s, and other companies in China, might think at first that the concern was Chinese. No one but Celestials is to be seen. This system is an approximation of two views. The Chinese might desire to handle his own trade, in which case the compradore would set up for himself, and buy sewing-machines, oils, machinery, tobacco, cotton, etc., direct from the foreign agent at the treaty port, or he could ignore the foreign agent and send his Chinese buyer across to San Francisco, or over to London. Or the foreigner might learn the language, dismiss his compradore, and try to sell direct to the Chinese consumer and Chinese merchant.

It is a world-trade question, a terrific struggle in economics, this getting rid of the middleman, the drone, and it is therefore still an unsettled question in China. The compradore and shroff exist, although many foreign commercial travelers, especially Germans and Japanese, are selling direct to the Chinese in small lots. Many of these compradores have become notable and able men, especially those employed by the Hongkong and Shanghai Banking Corporation. Again, some compradores have tricked the foreign agent and company with all the legerdemain of a conjurer. That is, instead of inducing the foreign agent to bring out large quantities of oil, flour, etc., we shall say, in time for a high market, the compradore, with his Chinese alliances (or conspirators, shall we say!) induces the agent to get stocked in godown when a low market suddenly drops on him. The compradore shifts and says the market will drop lower still, and the agent authorizes the compradore to sell quickly. The compradore sells to himself by dummy, and the oil or flour suddenly rises. The agent is mad clear through, but if he changed compradores every time this happened he would change so frequently that his concern would lose prestige with the Chinese. The Chinese compradore will bleed you, but he will not knowingly bleed you to death. Of all ornithologists of trade, he does not believe in killing the goose that lays the golden eggs. He only plucks the goose occasionally! I have heard tales which, if they are true, would indicate that the Chinese compradore is not alone expert in legerdemain, but that the foreign agent sometimes “stands in” with him. There certainly are some mountain palaces and a princely ménage on the hills of the sumptuous Far East that the savings from an agent’s salary, or an unexpected legacy never bought. In trade and in politics, as well as in religion, “by their fruits ye shall know” compradores, agents, and every one else!

Successful companies operating in China, with foreign managers and with the majority stock in foreign hands, but using Chinese money also, are the following incorporated or joint-stock registered companies: