Chinese Enterprise And Foreign Capital

The import of foreign steel sharply compressed the space of Chinese traditional steel industry.For the strategy of import substitution and to made the material support for Chinese Industrialization,Zhang Zhidong directed the establishment of Hanyang Ironworks during his tenure in Hubei Province.Because of the lack of funds and long-term loss of Hanyeping Corporation,Sheng Xuanhuai lead the said factory to privatization,and began to seek for foreign loans.At the same time,Japan was short of iron ore,it hoped to build up long-term cooperative relationship with Daye Iron mine.Yawata Steelworks have signed contracts of transportation of iron ore with Hanyeping Corporation.Japanese financial institutions,mainly Yokohama Specie Bank,endorsed the loan contracts with the said corporation.There begins the link of benefits that contain iron ore and loan between Hanyeping Corporation and Japan.From the coal&iron sales contract in 1899,to the last two million Yen loan contract in 1925,Hanyeping Corporation have made the loan totally more than fifty million Yen.The corporation need working capital to enlarge the production,reduce the cost,and pay for the former debt to keep the credit.However,the method to pay for the debt is by the payment for the iron ore and pig iron,and the period diversified from years to several decades.Because of the turmoil of political situation and mismanagement,the accumulated debts became more and more.Hanyeping Corporation can not bear any longer and finally turn into the supplying site of raw material to Japan.For the subsistence and development of corporation itself,in the condition that central government and economic system can not provide enough support,Hanyeping Corporation choose to draw close to Japan and bind Japanese benefit with its benefit.In the circumstance of imperfection of industry,Japan used its national capital to realize its national benefit.The relevance of heavy industry and military industry lead to the incline of national capital to minerals,especially the iron ore.Therefore,the loan to Hanyeping Corporation played vital role in the export of Japanese capital to China.This research paper focus on Hanyeping Corporation,the biggest iron&steel enterprise in Asia at that time,to discuss and analyze its process from establishment to fall into debt crisis,and to express the complex and changing relationship between Chinese enterprise and foreign capital in modem China.From the aspects on the source and development of loan between Hanyeping Corporation and Japan,the establishment of Japanese financial control to the corporation,the impact of special relationship between Japan and corporation on the event of ordering electrical machine during the First War,the complete downfall of corporation after the First War,this paper linearly demonstrates the multiple face of debt relationship between Japan and Hanyeping Corporation.Based on vast Japanese and Chinese archive document and Japanese scholars' study on this subject,this research paper attempts to investigate the people,events,and impact involved in the process of bilateral relationship,and to express the choice of strategy and competition of benefit on both two sides.Hanyeping Corporation relied on the money and shelter form Japan,and attached its benefit to Japanese national strategy,which deviated the corporation from national interest.