Almost immediately after the Restoration, the Government of the Mikado expressed the desire to revise the treaties concluded between it and the foreign Powers during the last years of the old regime. What it most desired was to abrogate the extra-territorial privileges granted to strangers, and to render them responsible to the native tribunals. It also hoped to re-possess itself of the right to modify the Custom-house tariff, which was very low, not with a view to protection, but in order to augment the revenues. In exchange for these concessions Japan offered to open the country to Europeans, to allow them to reside and to establish their industries anywhere outside of the five ports in which they had hitherto been confined. Joint negotiations were opened with the seventeen Powers who had signed the treaties on several occasions, but without favourable results, and the check they received in 1897 greatly irritated public opinion in Japan. The Government then decided to negotiate separately through the intermediary of its representatives in Europe. The first success was with England, by the treaty concluded in 1894; the other nations followed suit, and the new treaties were enforced on July 17th, 1899.

For several years, however, a change had taken place in public opinion in Japan, and many people began to think that it might be as dangerous to completely open the country to foreigners as to grant them privileges of proprietorship. ‘They are much richer than we are,’ said they, ‘and will buy up all our lands and strip us of our resources, so that in time we shall cease to be masters in our own house.’ On the other hand, the Europeans began to make an outcry at the thought that they would be obliged to submit to Japanese jurisdiction, which, although founded on the European system, might be misapplied by the Yellow people, who were still barbarians, and who might use it to make the existence of foreigners in Japan intolerable. Both views of the case were exaggerated, and rendered the task of the various diplomatists an exceedingly difficult one. Diplomacy, however, carried the day, not without sacrificing the proposed absolute equality of rights between Japanese and foreigners.

The new treaties accepted the Japanese desideratum respecting the suppression of consular tribunals and European municipalities, but foreigners were, in their turn, to renounce proprietary rights. The English treaty thus summarizes the principal concessions granted: ‘All members of the principal contracting parties may carry on any wholesale or retail business, in any sort of product, manufactures and merchandise, personally or by their representatives, individually or through an association, either with other foreigners or with natives; and they shall have the right to possess, let or occupy houses, shops, manufactories and other premises as they deem necessary, or to hire lands, to live therein, or to engage therein in business, by conforming themselves to the laws, and the police and Custom-house regulations of the country, as if they were natives thereof.’ This gave rise to considerable controversy. It confirmed the right of foreigners to possess, let or occupy houses and divers places of business, but on the other hand, it only allowed them to rent land, which according to Japanese law can only be hired on short leases of between thirty and fifty years, as the case may be, which is, of course, a great hindrance to the installation of any important industry.

This apparent contradiction formed the subject of an agitated controversy carried on by the English papers printed at the various ports, which pointed out with rather thoughtless acrimony that the new treaty was only intended as a blind to deprive foreigners of their extra-territorial liberties. They forgot that outside of property and of the leasehold system the Japanese code contains another method of tenure, called ‘Surface Right,’ whereby the purchaser of a piece of land has the right to everything that is on the surface thereof (excepting the crops), that is, to plant or cut down trees and to build thereon. One can purchase the surface of the land in accordance with Japanese law for as long a period of time as one likes, a thousand years even, either on payment by instalments or complete purchase. For any enterprise which is not purely agricultural this purchase is equivalent to absolute possession of the land.

Foreigners can thus establish industries in Japan, and it is therefore to the interests of the Japanese to encourage them so to do. Private individuals, as well as the Government, ought to do everything they can to attract foreign capital, but this can only be done in the case of industrial enterprises by allowing foreigners to take the direction of affairs. I have been asked whether it is not possible to induce foreign capitalists to lend their money on sharing terms to Japanese companies as they do to the American railways, without taking any part in the direction, but I am afraid this is a hope the Japanese would do well not to entertain. Whether it be through prejudice or otherwise, it is quite certain that Europeans will do nothing of the sort, and the Japanese seem to be aware of the fact, and several railway companies have modified their statutes in order to admit a clause whereby foreigners can become shareholders; but as the Japanese possess all the land over which the lines run as well as the stations, I do not think that this proposition can be legal. It is, therefore, to be regretted that public opinion has not insisted upon a concession of the right of proprietorship being bestowed upon foreigners.

It is, however, not improbable that before long the Legislature may get over this difficulty by deciding that in companies constituted according to Japanese laws, and registered in Japan, the members, though they be foreigners, become thereby Japanese citizens, and can also be absolute land-owners. However, on all points the Japanese Government, supported by Parliament and public opinion, has taken the necessary precautions to apply the new treaties in the most liberal manner possible. If there have been some unfavourable verdicts pronounced in the Japanese tribunals in the short time they have been in existence, these have generally been revised on appeal. The greater experience gained by contact between the Japanese and Europeans, and the wish to see foreign capital collaborating in the development of the resources of the country, will doubtless suggest, little by little, new measures calculated to smooth down any feeling of irritation between the native and the foreign population. If there still exists a feeling of hatred of the foreigner among individual fanatics, a certain ill-will in the lower and more ignorant class of the people, some abuse of authority among inferior officials, the Government of the Mikado is too sagacious to allow any flagrant cause of annoyance to disturb European residents, which would soon be resented by their respective Governments and might even lead to the scattering of the fruits of thirty years’ progressive effort.

Japan has already done much, but especially because she has done so much in so short a time, and because the immense majority of her inhabitants had no idea thirty years ago of European affairs, and therefore have no means of comparison, they are apt to exaggerate their progress, however marvellous it may be, and consequently they are not in a position to notice that certain European importations come to them slightly deteriorated. Foreigners act the part of critics, and even if their criticism is sometimes severe, it is nevertheless useful. The functionaries and the young men who are sent on foreign missions also fulfil the same critical office, and this is an additional reason why the Government is so wise in maintaining these missions. Unless, indeed, from time to time the new civilization which has been imported in Japan is refreshed at its primary source, it will soon run a risk of losing strength, and, for the matter of that, any people, even European, that isolated itself too much and became absorbed in self-admiration, would inevitably deteriorate. It is not belittling the extraordinary progress so rapidly accomplished by the Empire of the Rising Sun to say that it can only be perfected if the people of that wonderful country remain in contact with the inhabitants of Europe and America.

PART III.—CHINA

CHAPTER I
THE CHINESE PROBLEM

Actual position of the Far Eastern Question—The Sick Man of Peking—The wealth of his heritage—The immense resources of the soil and subsoil of China, the latter of which is still virgin—The results which may be expected from the opening up of China—Change in the attitude of the Powers towards the Celestial Empire since the Japanese victories revealed its weakness—The origins of the Far Eastern problem.