JAPANESE-OWNED COTTON MILLS IN CHINA: A STUDY IN INTERNATIONAL COMPETITION

In the field of cotton textile competition in the China market, Japan's cotton industry, by reason mainly of its use of cheap labor, its methods of raw cotton purchasing and its organization for sales abroad, made rapid advances by first ousting India from supremacy in yarn, then displacing the United States from the cotton piece goods market in Manchuria, and finally capturing the lead away from the United Kingdom, thus making itself foremost as the supplier of imported cotton textiles into China. Meanwhile in the very country in which this international competition was taking place, there arose a cotton industry of significant self-sufficient proportions, so that Japan's successes were made in a gradually declining market.;The growth of the Japanese-owned mills in China provided successful competition against the Chinese mills, both in the home market and export markets; while even the Japan cotton industry encountered competition from its branch mills, both in the China and foreign markets, mainly in yarn manufactures. To a slight extent, the establishment of branch mills to China was a boomerang to the cotton industry in Japan, and the force of this should be even greater in time.;The successful application of large capital resources to the abundance of cheap labor and raw cotton in China accounted for the advance of the Japanese-owned mills in China at the expense of the poorly capitalized Chinese mills. Compared with the Chinese mills they were more efficient and had lower costs in both yarn and piece goods manufactures, and compared to the Japan mills, both the Japanese-owned and many Chinese mills had lower spinning, though higher weaving, costs. . . . (Author's abstract exceeds stipulated maximum length. Discontinued here with permission of author.) UMI;A substantial part of the cotton industry in China consisted of Japanese branch mills, established mainly from 1914 to 1925, in order to take advantage of the abundant supply of cheap labor and raw cotton in that country, and to avoid the effects of the Chinese tariff. Actually, therefore, Japanese competition was continued by this extension of the Japanese cotton industry to China, and has been gathering even more momentum in recent years, particularly by the rapid expansion in North China.