.«;){;; hi.lhurrli 1(11 lUllHli frrriiMUilhniii hllliril.linu II i' I t ■ iftiil " ASIA !|::;;:::;, LIBRARY I- ANNEX 2 i B}. I li;:;:':;:: :l i;; illi MANCHURIA Land of Opportunities fwtL.ia^^'jf ^TXi«^-«r»^ /^»: :;£;;;;', iiiiiiiiiiiii 'lUMI'iMiilli.'llJ (Darnell Mniueraity Hibratg ' 3tl(ata, Sfeni fork .SQ:u,t}i..l55a.ac}iurla,. Railway - - Cojiipany Cornell University Library HC 428 .M2S72 Manchuria, land of oi portu nitiesiillustr 3 1924 021 463 520 Cornell University Library The original of tiiis book is in tine Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://www.archive.org/details/cu31924021463520 MANCHURIA Land of Opportunities MANCHURIA Land of Opportunities Illustrated from photographs With diagrams and maps NEW YORK SOUTH MANCHURIA RAILWAY 1922 Copyright, 1922 South Manchuria Raili^^y Co. Printed in U. S. A. Compiled and published by Thomas F. Logan, Inc., New York PREFACE This handbook of the resources of Manchuria has been prepared for American readers in response to many re- quests for accurate and concise information concerning the opportunities for overseas trade and the facilities for travel in this ancient land of the Manchus. Perhaps nowhere else in the world today is there pre- sented so amazing a transition from primitive agricul- tural life to tAventieth century industry and scientific organization. Manchuria, since the close of the Russo- Japanese War, when the policy of the Open Door was inaugurated, has gone forward with great strides, absorb- ing Western ideas and developing her rich material re- sources. The record of this fifteen-year achievement in colonial enterprise is here set forth in facts and figures, with a careful avoidance of debatable questions of international politics. In the preparation of this book, the South Manchuria Railway has made use of all available official and authori- tative sources of information, and has drawn freely from the "Economic History of Manchuria", published in 1921 by the Bank of Chosen. CONTENTS CHAPTER I GEOGRAPHY, HISTORY AND GOVERNMENT PAGE ( 1 ) The Geography of Manchuria : The "Three Eastern Provinces" — Climate — Topog- raphy — Population 1 (2) A Short Chapter OF History: Legendary History — Genghis-Kahn, the Conqueror — The ascendency of the Russians — The Russo-Japan- ese War — The coming of the Japanese — A railway that brought prosperity and civilization 3 (3) The Government of Manchuria: Chinese governmental offices — Japanese jurisdiction in Manchuria — The railway civic administration 7 CHAPTER H NATURAL RESOURCES OF MANCHURIA ( I ) Agriculture : The Garden of Qiina — Area under cultivation — Rail- ways stimulating agricultural production — Methods of cultivation — Agricultural products — Soya beans — Kao- liang (a sort of sorghum) — Millet — Maize — Wheat — Barley — Buckwheat — Rice — Hemp and jute — Tobacco — Cotton — Wild silk — Sugar beets — Other crops — Stock-raising 13 vii PAGE (2) Forestry: Distribution of forests — Forsst conservation — Varie- ties of trees — Timber industry 27 (3) Fisheries: Salt water fisheries — Institution for encouragement of fisheries — Fresh water fisheries 29 (4) Mining: Development of mining — Principal mines — Gold — Iron — Coal — Mines not operated by the South Manchuria Railway — Salt — Natural soda — Magnesite — Other minerals 30 CHAPTER III DEVELOPMENT OF MANUFACTURING The new industrial era — Bean oil and bean cake — Flour milling — Beet sugar — Distilling — Brewing — Wild silk — Iron and steel — Chemical industry — Cement — Glass- ware — Pottery — Lumber — Other industries 38 , CHAPTER IV COMMERCE AND FINANCE ( 1 ) Foreign Trade of Manchuria : An economic miracle — Growth of the Port of Dairen — Foreign trade of Manchuria — Principal exports and imports — Trade with the United States 49 (2) Facilities FOR Commerce : Railways — Waterways — Ocean steamship services — • Steamship lines now operating to Dairen — Posts, tele- graphs and telephones— Warehousing — Insurance — Banking — Currency — Trade organizations 61 CHAPTER V THE SOUTH MANCHURIA RAILWAY AND ITS WORK PAGE ( 1 ) A Modern Railway in an Ancient Land : The Treaty of Portsmouth — Western civilization in the East — Activities of the company — Financing a great enterprise 68 (2) The Railway: Road and equipment — Railway shops — Railway finance — Railway traffic — Railway rates — Statistics of opera- tion — Warehouses 73 (3) Harbors AND Ships: Dairen, the gateway to Manchuria — Other harbors in Manchuria — Steamships 88 (4) Coal Mines and Steel Works: Coal mines — Anshan steel works 91 ( 5 ) Gas and Electricity : Gas works — Electric works 93 (6) Hotels: A modern hotel system — The Yamato Hotels 94 (7) Scientific Research Institutions: Putting science at work in Manchuria — The Dairen Central Laboratory — Geological Bureau — Agricultural Experiment Stations — Farm improvement work — East- ern Asia Economic Research Bureau — Other re- search work 95 (8) Civic Administration: The development of the railway area — Land and build- ings — Railway zone policing — Hospitals, sanitation and hygiene — Education 98 CHAPTER VI THE OPEN ROAD IN MANCHURIA. . . 106 INDEX 109 h I. GEOGRAPHY, HISTORY AND GOVERN- MENT ( I ) The Geography of Manchuria The "Three Eastern Provinces" — Manchuria is situated in the northeastern part of China, and embraces a total area of 365,000 square miles. It comprises the three prov- inces of Heilungkiang, Kirin and Fengtien. These are called by the Chinese the "Three Eastern Provinces." Manchuria is separated from Siberia on the north by the Amur River. On the west, Eastern Inner Mongolia touches its borders and stretches, a vast level country, far to the westward. To the east, the Maritime Province of Russia forms the boundary of Manchuria, and southeast of that. Chosen (Korea) is separated from it by the Yalu River. Manchuria on the south is washed by the waters of the Yellow Sea and the Gulf of Pechili. Climate — Manchuria is included within the parallels of 39° and 53° 30" north. Between these same parallels lie portions of Spain, France and Italy, but Manchuria has a very different climate than these European countries. It has what is termed a "continental" climate, and is sub- ject to decided extremes of temperature — long, severe winters and hot summers. The average monthly tempera- 2 MANCHURIA: LAND OF OPPORTUNITIES ture at Dairen varies from 24° F. in January to 76° F. in August. Further north the winters are much colder and the summer temperatures do not rise quite so high. In Harbin, for example, the average January temperature is around zero, and in July the average is 72° F. The spring season is windy, with the great winds coming across the Mongolian Plains. The rainfall in Manchuria is far less than in Japan. As a whole, the climate is healthful and well adapted to agriculture. Its great plains boast a rich soil, and the 27,000,000 acres now under cultiva- tion produce huge crops of beans, wheat, kaoliang (a sort of sorghum), millet and Indian corn. Topography — The Land of the Manchus is traversed north and south by two large mountain ranges and fertile valleys lie between them. A low ridge in the center of the country forms a natural division for the water courses running north and south. The mountains are rich in timber and minerals, espe- cially coal, and the rivers are navigable for hundreds of miles and served as travel routes before the building of railways. The largest of these rivers are the Amur, the Sungari and the Ussuri in the north, and the Tumen, the Yalu and the Liao in the south. The valleys of these rivers are fertile and highly suited to cultivation. The eastern part of Inner Mongolia resembles Northern Manchuria in parts, but contains also great steppes, plains and deserts — uncultivated windy spaces inhabited by nomad tribes. Population — The population of the "Three Eastern Provinces" and the eastern part of Mongolia at the pres- ent time can only be roughly estimated. An accurate Census of these districts has never been taken. Approxi- GEOGRAPHY, HISTORY AND GOVERNMENT 3 mately, however, the latest population count reached in the neighborhood of 25,000,000 people. Manchuria is inhabited by Manchus, Chinese and in the Kwangtung Peninsula by Japanese. Mongolia is in- habited chiefly by Mongolian tribes with a large sprink- ling of Chinese, who are all near the border of Man- churia. Besides these, there are some 600,000 Koreans in Mongolia, and more than 100,000 Russians. The average population per square mile in Manchuria is S3 people, or about the same as the state of Missouri, and considerably greater than that of the United States as a whole, which is now 35 to the square mile. In Fengtien Province there are 129 inhabitants to the square mile, about the same as in Ireland. The density of population of Manchuria and Mongolia, as these figures show, is much greater than has been generally believed. The population of Manchuria is increasing rapidly. Those already established in the country feel it more than ever their homeland since a great railway system has brought modern enterprise, education and civilization into the provinces. Every spring from 350,000 to 450,000 coolies migrate from Shantung to work on the Manchurian farms, and on the railway, and after the harvest 220,000 to 330,000 return to their homes. The others stay in Man- churia and find permanent employment. (2) A Short Chapter of History Legendary history — The beginning of Manchurian history is lost in antiquity; and much of the early history of this vast district is an uncertain legend. Manchuria and Eastern Inner Mongolia were given up to savage tribes, and the rivalries between them resulting in a con- stant, unorganized warfare was all the story that these wild regions boasted. 4 MANCHURIA: LAND OF OPPORTUNITIES At one time it appears that the Koreans spread over the country in great numbers, but the Mongol and Tungus tribes were the most powerful and persisted the longest. Between the loth and nth centuries Manchuria was the theatre of active warfare. Rival dynasties were attempt- ing to rule the country, and hostilities were carried on also with the Sung Dynasty, then reigning in China proper. Genghis-Khan, the Conqueror — In 1260, however, Manchuria takes its place in history, with a thrilling chapter. Genghis-Khan, the great Asiatic prototype of Alexander the Great, dreaming his dream of a world em- pire, absorbed Manchuria in the great conquests that he made. Under his successors, Manchuria became a part of the Chinese empire and the Mongols rose steadily in power. They at length established a Mongol Dynasty to rule over China. In 1644 the first Manchurian Emperor of China removed his capital from Mukden to Peking, and caused the larger portion of his race to leave their old home and reside in China. Manchuria became the "For- bidden Country" and the government allowed nobody to enter, save those sent from China to gather wild ginseng or falcon feathers. This prohibition lasted for about a century, when the law was relaxed and a large Chinese immigration resulted. At the present time ninety per cent of the native inhabitants of Manchuria are Chinese. The rest are descendants of the original Manchus and Tungus tribes. The ascendency of the Russians — The Manchu Dy- nasty, existing from 1644 to 191 2, was the last to reign in China. From the 17th century military clashes occurred between the Russians in Siberia, north of the Amur River, and their Oriental neighbors to the south. In the 19th d GEOGRAPHY, HISTORY AND GOVERNMENT 5 century Russia acquired the Maritime Provinces and the Port of Vladivostok, which gave her access to the Pacific Ocean. From that time on her policy steadily gained a foothold in the Far East. The Treaty of Shimonoseki between China and Japan offered Russia the opportunity of securing the railway concession in North Manchuria. The Kwantung Province was leased to Russia for a period of twenty-five years, together with the railway concession in South Manchuria. The Russo-Japanese War — Admiral Aleksyeev was appointed by the Czar as Russian Governor General in the Far East, and he took up civil and military rule from the fortified port of Port Arthur on the Yellow Sea. With the advantage of such a fortified port, military con- trol of a great region, a great railway, an outlet through another port at the north, and railway connections across Asia straight into St. Petersburg, the Russians proceeded to make war with Japan. The Russo-Japanese War, 1904-1905, was fought chiefly in South Manchuria, and the struggle was one of the fiercest and greatest up to that period of the world's history. The siege of Port Arthur and its stubborn de- fense need no mention here. The whole world knows the story. The Battle of Mukden also has its place in history, and connected with that battle is the splendid account of how the Japanese protected from dishonor the tombs of the Manchu Emperors at Mukden. This one act of the Japanese appealed strongly to the Chinese with their rigid ideas regarding respect for the dead, and had much to do with the friendly Chinese feeling extended to Japan at the close of the war. The coming of the Japanese — The war was terminated by the Treaty of Portsmouth, signed at Portsmouth, New 6 MANCHURIA: LAND OF OPPORTUNITIES Hampshire, in 1905. That treaty gave into the possession of the victorious Japanese, subject to agreement v/ith China, the Kwantung Territory and the southern portion of the Manchurian Railway, from Changchun to Dairen and Port Arthur, and all the property pertaining thereto, including extensive, partially developed mines. In 1906 the South Manchuria Railway Company was organized to develop and maintain the South Manchuria Railway and to supervise the Railway Zone. A treaty, concluded May, 1915, between Japan and China extended the lease of the Kwantung Leased Territory and the South Man- churia Railway Lines to 99 years. A railway that brought prosperity and civilization — It will be plain that, without bias, it may be stated that a great developing influence has been brought into South Manchuria and the adjacent provinces by the railroad. The progress that has taken place since the railway has been under the control of the Japanese has been phenom- enal. The once "Forbidden Land" has been opened not only to the world at large, but, more particularly, to the Chinese themselves, who never dreamed that such golden opportunities lay at their very doors. Less than a genera- tion ago the Russians opened up portions of the country, but it has been the Japanese who have made it a land of opportunity for the world. New towns, built by the Japanese, have sprung up along the railway — not mushroom towns, but cities, planned and built after the best Western models, with spacious streets and boulevards, parks, hotels, clubs, schools, hospitals and markets. Today, strange as it may seem, the traveler in these old Manchu provinces of China finds express trains with luxurious dining and sleeping appointments, towns with palatial hotels and GEOGRAPHY, HISTORY AND GOVERNMENT 7 Continental service, travel bureaus and clubs where he is made welcome — Occidental civilization transplanted overnight in an Oriental setting. (3) The Government of Manchuria Chinese governmental ojfices — The three provinces of Manchuria (Fengtien, Kirin and Heilungkiang) are subdivided into minor districts or tao and prefectures. The tao are administered by taoyin or superintendents, and the prefectures by prefects. Each province has a tuchun, or military commander, who, being nominally the Civil Governor, is credited with the real political power. At Peking there is a Ministry of Agriculture and Com- merce which looks after, or was designed to look after, all of the industrial institutions in China. This ministry normally embraces four bureaus: Agriculture and Fores- try; Industi'y and Commerce; Mining; Fisheries and Stock-farming. However, the administration of such bureaus, insofar as it reaches into the distant provinces, is, under the disturbed conditions prevailing throughout China, a matter more of name than action. The Chinese Provincial Governments of Manchuria have the execu- tion of all laws and administration in their hands. The Chinese Provincial Governments of Manchuria, situated at Mukden, Kirin and Tsitsihar, and also the Military Governments of Inner Eastern Mongolia each has a Board of Industry under the direction of the Pro- vincial Governments which attends to all questions of in- dustry in those districts. In fact, Chinese administration is organized along the usual lines employed in other coun- tries, but, owing to the political disturbances surrounding the central Chinese Government at Peking today, the 8 MANCHURIA: LAND OF OPPORTUNITIES carrying out of provincial administration of the three eastern provinces of Manchuria and Mongolia lies al- most entirely under the control of the Governor General. The present Governor General of Manchuria, Gover- nor General Chang Tso Lin, has his headquarters at Mukden. General Chang Tso Lin is a man of great personal force and ambition. He has given much support to the methods of modern living, sanitation, education and industry w^hich have been brought into the country by the Japanese. Many of these methods have been adopted by the Governor General and used in his own administra- tion of the Chinese provinces. The present Governor General exerts a most powerful influence throughout the three eastern provinces. There is also in Manchuria a Forestry Office at Harbin and a Mining Inspector's Office at Changchun. Presum- ably under the direction of Peking, these offices, however, are controlled by the Governor General of Manchuria, and all important negotiations regarding the afJairs di- rected by these offices are carried on at the Governor General's Yamen in Mukden. Japanese jurisdiction in Manchuria — The Japanese jurisdiction in Manchuria is limited to 1,300 square miles, known as the Leased Territory in the Kwantung Peninsula, and the South Manchuria Railway Zone of 100 square miles. This Japanese jurisdiction is confined to civil administration in the Leased Territory, and to railway guard, police and postal service in the Zone. For the benefit of the people within the boundaries of these two districts, there has been also instituted an Industrial Department. The Kwantung or Japanese Government pursues a policy of investigation, experiment and encour- GEOGRAPHY, HISTORY AND GOVERNMENT 9 agement resulting in extensive agricultural, stock farm- ing, forestry and industrial enterprises. The Leased Territory is divided for local government purposes into three civil administration districts with headquarters at Dairen, Port Arthur and Chinchow. Port Arthur and Dairen are partly self-governed, having been raised to municipalities electing their mayors and counsellors, among whom, at Dairen, there are many prominent Chinese. The Leased Territory is a "free zone" and consequently no duty is levied on goods imported for consumption within it; but articles passing the frontier into Manchuria are subject to the Chinese tariffs. The entire system for the administration of the customs is in the hands of the Chinese. They maintain forty-seven regular custom offices in China, and eleven in Manchuria. The Man- churia custom offices are situated as follows: North Manchuria — Aigun, Sansin, Manchuli, Harbin, Pogran- chinaya, Hunchun, Lungchingstun; South Manchuria — Antung, Tatungkow, Dairen, Yingkou. Various customs sub-stations for the South Manchuria Railway are located at Port Arthur, Chinchow, Pulantien and Pitzuwo. The railway civic administration — The South Man- churia Railway, having under its charter assumed the re- sponsibility of taking care of the public health and the civil engineering enterprises throughout the railway zone, at first sought the aid of various local organizations to handle the matters of public works. The company was also invested with authority to receive rates from the in- habitants of the zone for the purpose of assisting in the carrying out of beneficial projects such as the upkeep and improvement of public utilities, schools, hospitals, etc. To this end the rules that were to cover the regulations 10 MANCHURIA: LAND OF OPPORTUNITIES for receiving public monies were formulated in a large measure by the residents themselves. In 1907 when the company took over the management of the Railway Area there were "settlement councils" at various centers along the railway. The company thought it expedient to utilize them to act as its agents in the mat- ter of rates and fees and other necessary assessments, but this experiment was not as successful as the company had hoped it would be. In the same year, therefore, the com- pany established district agencies of its own at Liaoyang, Mukden, Changchun and four other places. Today there are eleven of these district agencies as follows: Wafang- tien, Tashihchiao, Liaoyang, Mukden, Tiehling, Kai- yuan, Ssupingkai, Kungchuling, Changchun, Penhsihu and Antung. At Shakakou the railroad workshops per- form the duties of district agencies, and at Fushun the general offices of the collieries do a similar service. Where there is no district agency, the railroad station master is charged to assume part of the duties of district agent. According to the conditions and regulations concerning the rates and fees in the railroad area, the outlay for im- provements of public utilities within the area is borne by the company, while the current expenses in connection with maintenance, etc., are paid out of the monies assessed upon and received from the residents, the company mak- ing good any deficit. The rate of all fees is regulated by a system of scale assessment determined largely by the financial status of the town and the residents. Under this plan the work has greatly progressed. The railway com- pany, up to 1920, had invested in city building and civil engineering works, $4,395,000; in hospitals, schools and other public works, $3,775,000; in building and dwelling houses, $3,070,000; a total of more than $11,000,000. There are other places besides Dairen and Port Arthur GEOGRAPHY, HISTORY AND GOVERNMENT II which assume the standing of modern cities. Mukden, the junction city of the South Manchuria Railway main line, the Antung-Mukden line and the Peking-Mukden line; Changchun, the junction point of the South Man- churia main line, the Chinese Eastern line and the Kirin- Changchun line; Ssupingkai, the junction of Ssupingkai- Taonan line and the South Manchuria Railway line; Fu- shun, the coal city; Anshan, the steel city; Wafangtien, Tashihchiao, Liaoyang, Tiehling, Kaiyuan, Kungchu- ling, Ssupingkai, Antung and Penhsihu are all in this group of well managed, flourishing cities. As the native Chinese usually live in unsanitary houses, the company has built many dwellings of modern type and has leased them mostly to the employed natives to bet- ter their living conditions. The "Commercial Handbook of China," published by the Depart- ment of Commerce, Washington (1920), gives the following sum- mary of Manchuria: Area — 365,000 square miles. Population — 15,000,000; 40 per square mile; densest in Liao Plain. Topography — Three provinces, Fengtien, Kirin, and Heilungkiang ; northern region larger and better wfooded, sloping toward Gulf of Liaotung ; Sungari plain in north and Liao plain in south have won- derful soil and splendid crops ; large areas still uncultivated ; on rich plateau lands, grass sometimes grows 6 feet high ; climate is health- ful, though winters are very severe. Agriculture — Manchuria contains some of the finest agricultural land in the world. It seems strange that this virgin country, so sparsely inhabited and so rich in possibilities, should have remained all these centuries in proximity to densely populated countries and not have been more effectively colonized ere this. The principal crop of Manchuria now is beans, an article whose value has only recently come to be appreciated by the outside world. Wheat ranks second in importance. Other cereals, such as millet, sorghum and maize are raised in large quantities. Silk, fed on oak leaves, is one of the products of Manchuria. Tobacco, beet sugar, indigo, vegetable oils, fruits and live stock add to Manchuria's agricultural wealth. 12 MANCHURIA: LAND OF OPPORTUNITIES Minerals — Practically the whole of South Manchuria is one vast coal field. Iron and gold are also found. Japanese capital is devel- oping the coal and iron properties in a large way. Industries— Bea.n oil, bean cake and bean products generally con- stitute a great industry in Manchuria. Raw silk, tobacco, flour, furs and skins, lumber, and iron and coal are developing into profitable industries, employing in some cases enormous capital. The South Manchuria Railway, with its ramifications of industry, is the biggest institution in Manchuria. Communications — Waterways : the Amur River is navigable for 450 miles for steamers and 1,500 miles for smaller craft; the Sungari is navigable to Kirin, the Nonni to Tsitsihar, the Liao to Tung- kiangtze, and the Yalu for its entire course. Railways: Mukden is connected on the south with Tientsin and Peking, on the north with Harbin and Tsitsihar, on the southeast with Port Arthur and Dairen, and on the east with Antung; through rail service from Peking to Yokohama, via Manchuria and Korea, is established, and also in peace times from Peking to Petrograd via Manchuria. Country roads are relatively good, and travel is by carts or on mules. Post offices, 203. Telegraph stations, 132. Cities — Mukden and Kirin, 100,000 each. Kwangchenglze (Changchun), Harbin, Aigun, Newchwang (Yingkou) and Dairen are other important cities. Treaty ports — Aigun, Antung, Dairen (Japanese leased territory), Manchouli, Newchwang, Sansing, Suifenho, Mukden, Fakumen. Fenghwangcheng, Hsinmintum, Tiehling, Tungkiangtze, Liaoyang, Changchun, Kirin, Ninguta, Chientao, Tsitsihar, Hailar. Language of natives — Northern Mandarin is most common. American interests — In north, under jurisdiction of Harbin con- sulate ; in northeast, of Antung consulate ; in Dairen and Leased Ter- ritory, of Dairen consulate ; in South Manchuria, of Mukden con- sulate general. Looking down Ssu-Ping-Chieh toward the Bell Tower, Mukden Typical street of the old Chinese towns of Manchuria Pei-ling, the Northern Tomb of some of the Manchu Emperors, outside the wall of Mukden Beautiful Buddhist temple and monastery at Chienshan, built early in the 11th century II. NATURAL RESOURCES OF MANCHURIA { I ) Agriculture The Garden of China — "Manchuria," says the En- cyclopedia Americana (1921), "has one of the richest soils in the world, and, with the development of the soya bean industry, has grown more rapidly than any other Chinese province. In the summer the southern part looks to an American much like Illinois, and one may find on its northern hills lilies-of-the-valley, pink peonies, white and yellow daisies and the fragile dog roses, as in Wiscon- sin and Minnesota. With the exception of the four ice- locked months its fields are luxuriant with wheat, barley and millet, so that its has come to be called the 'Garden of China'." The "Economic History of Manchuria," published in 1921 by the Bank of Chosen (an interesting and valu- able contribution to the growing literature of Manchuria) states : "Manchuria is yet the most favored spot for agriculture in the Far East, and its opportunities may well be termed 'immense'. That great mass of level land, extending over the whole of Central Manchuria and comprising the basins of the Liao, Sungari, Nonni and Hulan, the productiveness of which can compare favorably with any part of Japan or Korea, is by itself as large as the whole 13 14 MANCHURIA: LAND OF OPPORTUNITIES of the Chinese Peninsula* or of the mainland of Japan, and, to those who know how little of level land there is in these two countries that is really arable and actually under cultivation, it will not be at all difficult to imagine the wonder in which the two peoples look upon this ap- parently boundless extension of rich field. An American gentleman with whom the author had the honor of travel- ing in Manchuria ejaculated, as the train was drawing near to Mukden, 'This is exactly what we see in America', as though relieved at seeing something homelike after a long journey through apparently endless chains of rugged mountains in Japan and Chosen." Area under cultivation — -The aggregate area under cultivation in Manchuria and Eastern Inner Mongolia is 33,585,000 acres, distributed as follows: Fengtien Province 11,392,500 acres Kirin Province 7,847,500 acres Heilungkiang Province 7,935,000 acres Eastern Inner Mongolia 6,410,000 acres The arable land awaiting development is estimated at 42,500,000 acres, an area equal to the improved farm land in the states of Indiana and Illinois. The land being re- claimed is estimated at about a million acres a year. Railways stimulating agricultural production — Until quite recently the crops were transported through inad- equate waterways and by primitive Manchurian carts, but the establishment of railways and the highly efficient port of Dairen has made a radical improvement in trans- portation methods. The Chinese Eastern Railway, the South Manchuria Railway, and the Peking-Mukden Line of the Chinese Government Railways are now carry- ing annually large numbers of immigrants and great stocks of agricultural produce. •Chosen (Korea) NATURAL RESOURCES OF MANCHURIA 1 5 Methods of cultivation — Agricultural methods in many parts of Asia have changed little in centuries. But in Manchuria a great change has taken place since the South Manchuria Railway inaugurated its program of economic development work. Modern methods are taught the native farmers; the fertility of the soil has been increased; the yield and quality of the great staple crops have been improved; and new plants and trees have been introduced. For this reorganization of Manchurian farming, the Agricultural Experiment Stations instituted by the rail- way are primarily responsible. These stations are op- erated like those in the United States, and seek to bring to Manchuria the latest world knowledge of scientific agri- culture. At Kungchuling (in the heart of Manchuria, 400 miles north of Darien) is the main experiment station. Here are being carried on important experiments in animal breeding. Merinos from the United States have been bred with the native sheep, increasing the quality and yield of wool, and thus giving great impetus to the export trade. Berkshire hogs have been imported for breeding to improve the native stock. Much has been done to increase the oil content of Man- churia's chief product, the soya bean, and better cultural methods have been taught the farmer. The arboriculture work at the Hsiungyocheng experi- ment station has been productive of most important results in reforestation and afforestation. Much of this country was barren of trees. But now big orchards dot the south- ern part of Manchuria; American apples and grapes have been successfully introduced, and the fragrant perfume of the acacia fills the air. In northern Manchuria there have 1 6 MANCHURIA: LAND OF OPPORTUNITIES been planted many willows and Chinese poplars, from the wood of which match stems and pulp are made. Experiments are going forward at Hsiungyocheng for the improvement of the cultivation of the tussah, or wild silk, one of the principal exports. Agricultural products — The chief agricultural prod- ucts of Manchuria are soya beans, kaoliang (a sort of sorg- hum), millet, maize and wheat. The output of the leading crops in 1920 in tons was as follows : Soya Small Kaolian!* Millet Beans Corn Barley Wheat Beans Kwantung Territory ... 16,000 17,900 15,500 60,000 1,800 1,100 4,200 Fengtien Province ...3,340,000 1,853.000 1,762,000 1,033.000 53,000 143,000 132.000 Kirin Province 2,148,000 1,929,000 1,135,000 428,000 1,223,000 368,000 116,000 Heilungkiang- Province. 678,000 893,000 551,000 154,000 178,000 515,000 52,000 Eastern Inner Mongolia 551,000 436,000 326,000 49,000 75,000 66,000 57,000 Total 6,733,000 5,128,900 3,789,500 1,724,000 1,552,000 1,093,100 361,200 Soya beans — The United States Department of Agri- culture, in a recent report, made this statement: "The rapid rise of the soya bean to a crop of special importance in the world's commerce in the past few years is one of the most remarkable agricultural developments of recent times." The soya bean has been an important food in China for 5,ooo years, but it is only during the past few years that America and Europe have learned of the great utility of this prime staple of the soil of Manchuria. The Japanese firm of Mitsui & Company made the first shipments abroad in 1908, when an initial shipment of a hundred tons was made to England. Huge quantities of soya bean oil were imported into the United States during the World War to supply essential raw materials. With its very high content of protein (40%), the soya bean has been characterized as a "modern manna." NATURAL RESOURCES OF MANCHURIA 17 Among its many uses the Department of Agriculture lists these : rManure fHay. Plants. ^ Forage. < Ensilage. ^Pasture. LSoiling. r?ileal. Seeds. Oil rHuman food A Stock feed. LFertilizer. "Glycerin. Explosives Enamels. Varnish. Food products Waterproof goods. Linoleum. Paints. Soap stock Celluloid. Rubber substitute. Printing inks. Lighting. Lubricating. rBreakfast foods. Diabetic foods. Flour J Infant foods. Macaroni Crackers. Milk. J. 1 Muffins. iBiscuit. Bread. Cakes. Food . . Dried beans. Green beans . rButter substitute. J Lard substitutes. ^ Edible oils. LSalad oils. ( Soft soaps. I Hard soaps. 'Soy sauce. Boiled beans. Baked beans. Soups. Coffee substitute. Roasted beans. Vegetable milk . . ^Breakfast foods. rGreen vegetables Canned. Salads. I {Fresh. Dried. Smoked. Fermented. Condensed milk. Fresh milk. Confections. Casein. The development of a world market for Manchuria's chief product has resulted from the activities of the South Manchuria Railway in improving the quality of the soya bean and exploiting new uses for it through its agricul- tural research laboratories, and in systematizing the trans- portation and merchandizing of the crop. The growth of the industry has provided employment for hundreds of thousands of Chinese, who have been attracted to Man- churia from the neighboring provinces, chiefly from Shan- tung. From the busy port of Dairen, the gateway to Man- churia and the southern terminus of the railway, mer- chant ships of many nations now carry great cargoes of THOUSANDS OF TONS SOYA BEANS Exports from Dairen : 1910-1920 1,100 = ^* 1,000 - / ..-^ 900 - I 800 u — -_ --. « / 700 I > 600 - A I. •f' K 500 - / «J/' / r \ 400 - / / 1 / 300 \ / / 200 - \ '??' ^ ^ \ / 100 - \^ V' V ' . ■-^ = "^ oV; n Ta t4 0^ iH ITS 1-4 00 ▼-4 1-H 18 NATURAL RESOURCES OF MANCHURIA 1 9 soya beans and bean oil to the United States, England, France, Sweden, Holland, Denmark and Egypt, as well as to neighboring countries. Beans are exported mostly to China and Japan, bean cake to Japan, and bean oil mostly to Europe and America. In South Manchuria there are nearly 200 large bean mills, using various methods of oil expression, from the primitive hand press to motor power. A new process to extract oil by means of chemical action was adopted at a new experimental bean mill built by the South Manchu- ria Railway in 1915, and, in pursuance of the company's policy, when the superiority of the process had been estab- lished, it was turned over to private management to de- velop commercially. Another development in the bean- oil industry is also due to an invention made at the com- pany's laboratory for the hardening of bean oil and the manufacture of stearin, olein, glycerine, etc., which led to the establishment of a private company for its special exploitation. Soya beans of Manchuria are divided into four classes, according to color — yellow, white eyebrow, green and black. The chemical composition of soya beans, accord- ing to analyses made in the Dairen Central Laboratory, is as follows (the figures showing percentages) : Albumi- Carbo- Moisture noids Fat hydrates Fibre Ash % % % % % % Yellow Bean 9.11 39.90 17.59 24.27 4.92 4.21 White Eyebrow . . 12.34 37.35 17.37 23.36 5.12 4.36 Green Bean 12.64 36.47 16.23 25.08 4.89 4.69 Black Bean 10.74 35.32 15.80 24.43 5.96 4.00 Kaoliang [a sort of sorghum) — The staple food of the native population is kaoliang, and it is also the principal grain food of the numerous animals engaged in farm- work and the carrying trade of the three provinces. 20 MANCHURIA: LAND OF OPPORTUNITIES Before soya beans attained their present importance, half the total area of the cultivated land in Manchuria was devoted to kaoliang, and a large amount of it was ex- ported to other provinces of China. Recently the cultiva- tion of kaoliang has given place to that of beans in many places. In South Manchuria 26.6% of the cultivated area is devoted to kaoliang, 20% to beans, 16.1% to millet, 25.6% to corn, 2.5% to wheat and 9.2% to other crops. In North Manchuria a larger percentage of the area is de- voted to millet, kaoliang and wheat, and less to corn. The annual production of kaoliang in Manchuria is estimated at about 180,000,000 bushels. It is not only used as a foodstuff for man and beast, but the native spirit is also made out of it. Nor are the grains the only useful part of it; the stalks play a very important role. The outer leaf layers are woven into mats, so much required in the trade of the country, for roofing ricks and packing loads of grain and beans, and for numerous other pur- poses. The stalks are also utilized for fencing, bridging and housebuilding, and where wood and coal are unob- tainable or dear the stalks are used for fuel and pulp. Kaoliang spirit, extensively used in both Manchuria and Mongolia, is colorless and transparent, and possesses a strong flavor, which peculiarly appeals to the taste of the natives. Millet — As the staple food of the native population millet is next only to kaoliang, and in North Manchuria, where kaoliang does not prosper, it is the main food of the inhabitants. It is also important as material for dis- tilling native spirit, huangchu (yellow drink) , while its straw is universally used for fodder. Millet is cultivated throughout Manchuria, but more largely in the north than in the south. The annual production is about 150,- Harvesting on the Kungchuling Agricultural Experiment Station farm Soya beans stored in great matting bins, looking not unlike some American hayricks Primitive method of threshing kaoliang with flails of rope Getting in a coarse but nutritive harvest on a Chinese far NATURAL RESOURCES OF MANCHURIA 21 000,000 bushels. Its importance as an article of trade is growing. Maize — Maize or Indian corn is grown in Manchuria in the same way as kaoliang. It is divided into three kinds — yellow, red and a native breed called laolaichou. It is grown in the southern part of South Manchuria and also in a part of North Manchuria, and also forms an important article of food. In North Manchuria, an in- toxicant is brewed from it. The stalks are used as an article of fuel while the leaves are good for fodder. The crop is about 50,000,000 bushels. Wheat — North Manchuria is an ideal wheat field, and wheat is there grown in considerable quantities. The best wheat fields are found around Ningan, Petuna and Har- bin, along the right bank of the Sungari, and in the coun- try around Suiwha. In South Manchuria wheat fields are mostly found around Hsifeng and Hailung, and the country lying to the west of the Liao, while Tiehling has one of the largest fiour-mills in Manchuria. Wheat has been cultivated in South Manchuria from very early times, but only very recently has the production been suf- ficient to encourage export. Manchurian wheat is now beginning to take its place in world trade. In 1920 through the port of Dairen 342,550 tons were exported to Europe, and in 1921 the exports were 165,300 tons. Barley — The cultivation of barley in large quantities dates from the Russo-Japanese War, when the demand for it was called forth by the Japanese army in Manchu- ria as the grain food for horses. It is now cultivated in considerable quantities around Changchun, Kungchu- ling, Liaoyang and Haicheng. It is used by the natives as food and as feed for their animals. It is also used as a ferment in the distillation of native spirit. Its annual production is estimated at 30,000,000 bushels. 22 MANCHURIA: LAND OF OPPORTUNITIES Buckwheat — Buckwheat is an autumn crop which re- quires only two and a half months to ripen, being sown in July and harvested in September. It is often sown after wheat, or takes the place of other crops when these fail on account of drought or excessive rainfall, so that one harvest at least may be obtained from the soil. It is ground into flour and made into a kind of macaroni, baked into cakes, or boiled to make gruel. Rice — Rice in Manchuria is not cultivated in paddy fields, but it is grown on dry land like other cereals. The production has never been very large, for the Chinese in Manchuria do not care much for it, and do not use it ex- cept on rare occasions, such as big dinners and festivals. The annual production of upland rice is 6,000,000 bushels, and water-field rice 900,000. The demand is now fast growing owing to the entry of the Japanese into Manchu- ria, and, just as the Russian entry into the north stimu- lated the cultivation of wheat, that of the Japanese in the south is encouraging rice cultivation there. The cultiva- tion of water-field rice was first undertaken by the Korean immigrants, then it was followed by the Chinese, and to- day many Japanese are engaged in the cultivation of it along the railway lines. Hemp and jute — Hemp is grown in Fengtien and Kirin Provinces, the total production being 21,000,000 pounds a year, about three-quarters of which is grown in South Manchuria. Jute is grown along the Liao, Nonni, Sun- gari and Tumen Rivers. The annual production is 31,- 000,000 pounds, about three-quarters of which is pro- duced in North Manchuria. A large part of the hemp and jute is consumed where it is grown. The amount of hemp coming into the market is now about 3,000,000 pounds a year, and of jute 6,500,000 pounds. Hemp NATURAL RESOURCES OF MANCHURIA 23 plants cultivated for seed are not as a rule utilized for fibre, or, if they are, the yield is of a very poor quality. It is chiefly in South Manchuria that hemp and jute are grown for fibre. These are differently cultivated. Some are cultivated for the double purpose of seed and fibre. The best hemp, white and tenacious, is produced around Hailung and Hsifeng in Fengtien Province, and is gen- erally woven into cloth, while the next quality is produced around Pinhsien and Ningan in Kirin Province, and is generally made into thread. A more ordinary quality is mostly made into nets and ropes, and the poorest is used for paper-making. Jute is less flexible than hemp, but because of its waterproof nature is used in the making of bags, ropes, nets and string, and various shipping and fishing tackles. In 1916 a company was formed in Dairen to manufacture hemp bags, using Manchurian hemp and Indian jute. Tobacco — Tobacco is one of the staple products of Manchuria. The best leaf is raised around Kirin. It is blended with foreign leaf in making cigarettes. The British American Tobacco Company has a factory at Mukden, and the East Asia Tobacco Company has a factory at Yingkou. The export of the native leaf is increasing. Cotton — Cotton is grown only in the region lying to the south of a line drawn between Tiehling and Kangping. Cotton in Manchuria was originally cultivated on a very small scale by the farmer for the use of his own household, and it was only around Liaoyang and Chinhsien that cot- ton was brought to the market as an article of trade. Wild silk — The cultivation of wild silk was begun in China 1800 years ago and introduced into Manchuria by immigrants from Shantung Province about a century ago. 24 MANCHURIA: LAND OF OPPORTUNITIES The industry developed year by year, taking into the silk region district after district, until it now comprises the whole country, including in the south the Leased Terri- tory of Kwantung and in the north the towns of Kaiyuan, Changtu, Hailung, Tunghwa, etc., in short, nearly all South Manchuria. The following table shows the ap- proximate number of farms in the principal districts: Country Number Country Number around of farms around of farms Liaoyang 170 Kwantien 2,527 Fuhsien 1,143 Kaiping 5,357 Antung 1,575 Fenghwang 663 Haicheng 561 Huanjen 51 Hsiuyen 770 The quantity of wild silk cocoons produced each year is between six and seven billions. Sugar beets — The soil is adapted to the sugar beet, and especially around Mukden are large tracts under cultiva- tion for the South Manchuria Sugar Refining Company. The development of the beet sugar industry has been stim- ulated by experiments conducted at the Agricultural Ex- periment Station since 1914. The average percentage of sugar in beets is 15.34%. Other crops — Manchuria has great possibilities as a fruit-growing country, and it is quite possible that it may develop into a great wine-producing region, owing to its natural fitness for the cultivation of the vine. In the belt from Kwantung north to Mukden, the orchard industry is being developed. Superior species of apples, pears, grapes, etc., are now being grown. Manchurian farms also produce potatoes, oats, red and kidney beans, etc. Stock-raising — Before the immigration of the Chinese from the south, the chief occupation of the original Man- NATURAL RESOURCES OF MANCHURIA 25 chus was the raising of stock. With the entry of the Chinese, the rich pastoral grounds which then covered the greater part of the country were converted one after the other into grain fields. Thus agriculture rose, but stock- farming waned. A shadow of the old pastoral age is still visible on the Mongolian frontier and in the western part of Heilungkiang Province, where the inhabitants are still devoted to the breeding of cattle. Besides, the Manchu- rian farmers generally keep large numbers of horses, mules, donkeys, oxen and pigs. The Chinese have always been more skillful in using domestic animals on the farm. Five or six head of cattle, horses, mules or donkeys are often hitched at random to a heavily loaded cart, and this motley team is managed with admirable dexterity by a Chinese driver. Sheep are very plentiful, especially in Mongolia, where the inhabitants depend largely upon sheep for meat, milk and cheese. Dogs are also to be found in great number throughout the countryside, as they are essential to the farmers for protection against bandits. Nearly every cottage has two or three dogs, and the larger farms have a dozen or more. The number of domestic animals in the different provinces is estimated at 23,300,000, of which 8,700,000 are fowl. The distribution of these animals is as follows: Eastern Fengtien Kinn Heilungkiang Inner Mongolia Total Horses 750,000 500,000 510,000 810,000 2,570,000 Mules 200,000 230,000 120,000 70,000 620 000 Donkeys 330,000 120,000 70,000 100,000 620 000 Cattle 580,000 90,000 210,000 1,120,000 2,000 000 Sheep and goats... 400,000 100,000 60,000 2,000,000 2,560,000 Camels 4,000 4,000 Pigs 3,550,000 1,250,000 490.000 1,000,000 6290,000 Total 5,810,000 2,290,000 1,460,000 5,104,000 14,664,000 The horses are all of Mongolian breeds, rather under- sized, and with great endurance. Mules, unknown in Japan, have long been bred in China. They command 26 MANCHURIA: LAND OF OPPORTUNITIES higher prices than the horses. The donkeys are used in farming and transport. The cattle are of Korean, Shantung, Manchurian and Mongolian breeds. The Chinese keep cattle to work them, and the Mongolians for the milk they yield, the beef being regarded as a by-product. The cattle in South Manchuria and Inner Mongolia have not been properly bred, and there is a great opportunity for improving the diflferent breeds by the mixture of foreign stock. The same is true of sheep and pigs. The native sheep give not more than three pounds of wool. With the recent develop- ment of the woolen industry in Japan, both wool and goat's hair have been exported in considerable quantities. In South Manchuria goat-raising takes the place of sheep- raising among the Chinese. Pig's hair is exported for brush bristles. The South Manchuria Railway Company, through its agricultural experiment stations, is importing American and British stock, and the day will come when Manchuria will be one of the finest grazing countries of the world. Breeding the native sheep with Merinos has increased the output of wool of two-year-old mixed sheep from 3.4 to 6.2 pounds. The second breeding with Meri- nos trebled the output of wool. Bred with Southdown sheep, the output of wool was increased to 4.5 pounds and with Shropshire to 5.9 pounds. The export trade in animals and animal products is bound to grow rapidly as modern breeding methods are introduced. The exports of these products from Man- churia in 1920 were: Taels Domestic animals, including cattle, horses, mules, pigs, sheep, etc 464,154 Wool, goats' hair, etc 293,442 Bristle and horse hair 273,349 Leather and hides and manufactures 983,866 NATURAL RESOURCES OF MANCHURIA 27 Eggs 591,446 Animal oils 113,973 Animal's boncb 166,311 (2) Forestry Distribution of forests — In South Manchuria, the foot of the Changpai Mountains, along the upper reaches of the Sungari, the Mutan and the Tumen, and also the upper parts of the Yalu and the Hun are densely wooded; while in North Manchuria, the districts about Hailin on the Eastern Section (between Harbin and Pogranichnaya) of the Chinese Eastern Railway arid about Sansing in Kirin Province are the principal forest lands. Mongolia is a vast plain consisting of level land grown with grass and dotted with dunes. Nothing like a forest can be seen. The forest areas are estimated as follows: a. On the right bank of the Yalu and along the Hun River; 1,600,000 acres with 6,900,000,000 cubic feet of timber. b. On the upper parts of the Sungari, the Mutan and the Tumen; 4,800,000 acres with 26,000,000,000 cubic feet of timber. c. Along the Eastern Section (between Harbin and Pogranichnaya) ; 6,000,000 acres with 18,500,000,000 cubic feet of timber. d. About Sansing district; 13,000,000 acres with 52,- 000,000,000 cubic feet. e. As to the forests in and about the Hingan Range, no data can be obtained, except that in the districts within a radius of about 30 miles around Horgo and Hingan Stations, the average timber asset is put at about 1,300 cubic feet to the acre. 28 MANCHURIA: LAND OF OPPORTUNITIES Forest conservation — Manchuria needs afforesting in many places. Hills and mountains now bare and barren but capable of being converted into fine forests for the benefit of the people, both from an economic and hygienic point of view, are visible everywhere. This is especially true in Kwantung, which is mountainous, yet with few trees on the mountains. The only trees seen in that region, when the administration of it was handed over to Japan, were a few willows and elms near villages and tombs. Nursery gardens were established at Port Arthur, Chin- chow and Dairen, to supply saplings for afiforestation undertaken by the government. Several million young trees have been planted annually for the past few years. The Fushun Colliery has instituted a very extensive program of afiforestation to provide timber for the mines. It is estimated that 54,000 acres must be planted with 1 10,- 000,000 trees, and the program calls for the completion of this plan in a period of thirty years. In the first year, 1919, an area of 980 acres was planted with 2,000,000 young trees, and at the same time 44,000,000 of sprouts were started in the nursery fields. Also, to encourage the general public in this useful undertaking, forest lands are rented free of charge to those desiring to afiforest them, and seeds and young plants are supplied to them. Regulations have also been published for the protection of forests. These measures have had the desired effect, and, with the increase in the interest taken by the public in the matter of afiforestation, many nursery gardens owned by villages have been formed. Varieties of trees — About three hundred kinds of trees are known in Manchuria and Mongolia, but the principal varieties number about twenty. About forty per cent of the forests are conifers, and sixty per cent broad-leafed Bean-oil junks arriving at Yingkou from up the Liao-ho Native freight - carriers trotting down a street in Yingkou Picturesque Chi- nese lumber raft passing under the modern South Manchuria Rail- way bridge at A n t u n g on the Yalu River Chinese water-carriers in Hsiliantze, a Chinese town near Dairen Within the railway yard at Changchun; soya beans— as far as the eye can reach NATURAL RESOURCES OF MANCHURIA 29 trees. Korean pines are the most common conifers. They are frequently from four to five feet in diameter, reaching a height of more than one hundred feet. Oaks, elms and poplars are the most common broad-leafed trees. Timber industry — As timber markets, Kirin and An- tung come foremost, followed by such consuming centres as Harbin, Changchun, Mukden, and Dairen. Kirin has long been a timber centre. Along the eastern section of the Chinese Eastern Railway, the railway management and Russians and Chinese have had railway sidings built to their lumber yards and are operating saw mills. Both Kirin and Yalu timber is carried down the rivers. (3) Fisheries Salt water fisheries — With the Yellow Sea to the east and the Gulf of Pechili to the west, and a coast line of 500 miles, the Leased Territory of Kwantung offers an ideal field for the fishing industry. The annual catch of fish there now amounts to more than 2,000,000 yen in value, and no fewer than some 6,000 families, or 18,000 fisher- men, are engaged in the work. The catch includes tai, cod, sword fish, guchi, sawara, sole, flounders, suzuki (bass), shark, nibe, sardines, shirasu, cuttlefish, octopi, sea-slug, oysters, earfish, prawns, lobsters, crabs, whales, seals, etc. The whale-fishery about Haiyangtao Island, near which the naval battle took place in the Chinese-Japanese War, is undertaken almost exclusively by the Oriental Whale Fishery Company. The catches are forwarded Shi- monoseki way. Seals arc captured on the ice-floes when the ice in the coast-waters breaks up on the return of spring in the north of the Yellow Sea and also in the north of the Gulf of Pechili. Institution for encouragement of fisheries — For the 3© MANCHURIA: LAND OF OPPORTUNITIES benefit of the fishing community the Kwantung Govern- ment established an experimental station for fishery prod- ucts in 1908 at Rokotan, about a mile south of Dairen. The station is provided with factories, fishing gear, store- rooms, warehouses and drying-chambers, and also with boats to undertake experimental fishing and explore the adjacent seas. There is also an association which was organized to protect and develop the common interests of the fishing community. Fresh water fisheries — Fresh water fisheries are ex- tensively conducted in all large rivers, notably in the Liao and Yalu in the south, and the lower reaches of the Sun- gari and its tributary the Hurka. The fish consist mostly of salmon, salmon-trout, carp, eels, etc. The Sungari also produces pearls. At one time no fewer than 7,000 to 8,000 pearls annually are said to have been taken from that river in the neighborhood of Kirin, but they do not appear to exceed 2,000 a year at present. (4) Mining Development of mining — Mining in South Manchuria is of remote origin. Local tradition declares that the coal mine at Fushun was worked as early as the twelfth century, but its working was prohibited by the founder of the late Manchu Dynasty from a superstitious belief in fengshui (Spirit of Nature). There were evidently some other mines once worked. But, except for some con- spicuous ones, traces of their working have been entirely effaced by the elements, particularly by the landslides caused by the indiscriminate felling of trees once uni- versally perpetrated throughout the country. It seems that most old mines were discovered during the course of this general deforestation, but this same action doomed the fate of the mines thus discovered since it deprived thern HMMM MM^Mi -=a THOUSANDS OF TONS SOUTH MANCHURIA RAILWAY Output of Fushun Coal Mines: 1907-1921 3,500 - 1 1 Tons ion? 7't'^ ^y^ 3,000 " - 1908 .... 490,720 1909 706,042 1910 .... 898,482 1911 .... 1,343,198 1912 .... 1,470,150 1913 .... 2,185,453 ■2.500 " - 1914 .... 2,147,432 1915 .... 2,169,245 1916 .... 2,039,578 1917 .... 2,275,905 1918 2,521,164 1919 2,928,186 2,000" - 1920 3,237,400 1,500 - - 1,000" - - ■■ •yOO " - 1 1 03 1 IT- a 1 ,,4 H ■1 <-l I ft 00 t H I CO rH I ON r-t I (N 31 32 MANCHURIA: LAND OF OPPORTUNITIES of the wood indispensable in mining. Even after the re- moval of the prohibitory law^, every possible obstacle was laid wittingly or unwittingly in the way of mining ex- ploitation. Mining in the modern sense was first introduced into the country by the Russians, when they, jointly with the Chinese, undertook to work the Fushun coal mine. But real progress in the industry began with Japan's succeed- ing to the Russian privileges and handing them over to the South Manchuria Railway Company to be worked. Principal mines- — ^Chinese authorities have listed some 600 places where minerals are located in Fengtien and Kirin Provinces, of which 213 are coal, 26 iron, 234 gold, and the remainder silver, copper and lead. Gold — Before the introduction of foreign capital for the development of Manchuria's mineral resources, gold was the only metal extensively mined. Manchurian gold is mostly alluvial, and so can be mined with a very small capital. Naturally, all the river beds containing gold dust have been ravaged by gold hunters, and in South Man- churia it is only in these worked-out beds that alluvial gold is now collected. Extensive traces of such mining are found in and around the regions of Hsingking, Tung- hua and Huanjen. It is asserted by experts that the alluvial gold of these regions came from gneiss which is abundantly found everywhere in Manchuria, and which always contains some gold. Beaten by the weather the gneiss disintegrated little by little, freeing the gold it con- tained, which, washed by the rain, deposited itself in the river beds. The most extensive alluvial gold deposits in South Manchuria are found in the tributaries of the Yalu and the upper reaches of the Sungari. In Heilungkiang Province there are many gold fields where ore is still ob- NATURAL RESOURCES OF MANCHURIA 33 tained in considerable quantities. Chiapikou in Kirin Province was famous for its gold sands years ago, and it is believed that there are still rich veins to be mined. Iron — Next to coal, iron is the most important mineral product of Manchuria. It mostly exists in veins in meta- morphic rocks, and the best veins are generally found in north-eastern Manchuria along the Yalu. These were worked by the natives on a very small scale. The ores are generally hematite, and though the percentage of iron they contain is not large, being generally about forty per cent, they are sufficiently rich to be worked with advan- tage. Two mines stand out prominently, Penhsihu and Anshan. The former produces about 50,000 tons an- nually, while the latter, with two hundred million tons of ore reserves, is being developed in conjunction with the new Anshan Steel Works. Coal — The Fushun coal mines, 22 miles southeast of Mukden, rank among the most important modern indus- trial enterprises in the Far East. The coal in the Fushun district was first worked by the Koreans some 600 years ago, the coal being used by them in baking earthenware. After the occupation by the Chinese, which took place about 200 years ago, mining was entirely suspended by prohibition of the Chinese government, as Fushun is lo- cated in the vicinity of the Mausoleum of Tai-tsu, an Em- peror of the Manchu Dynasty, built in the suburb of Mukden. During the Russo-Japanese war the mines were worked on a small scale by Russians, but not until 1907, when the property was transferred to the South Manchuria Railway Company, was mining undertaken on a large scale. The field, covering the valley of the Yingpan, is ten miles long and two miles wide, and has estimated deposits SOUTH MANCHURIA RAILWAY Sales of Coal: 1907-1921 34 NATURAL RESOURCES OF MANCHURIA 35 of 1,200,000,000 tons of bituminous coal. The coal seams range from 78 to 480 feet in thickness (the thickest in the world), averaging from 130 to 175 feet. The following are analyses of Fushun coal made on several samples at different times: Specific gravity from 1,229 to 1,342 Moisture from 2,240 to 7,-186 Volatile matter from 38,371 to 48,758 Fixed carbon from 45,340 to 60,465 Ash from 1,440 to 9,340 Nitrogen from 1,100 to 2,307 Sulphur from 0,338 to 1,738 Calorific value from 6,160 to 7,700 Color of ash, commonly light brownish grey; ash con- tains silicic acid, alumina, ferric oxide, sulphuric acid, calcium, and a little percentage of phosphoric acid and magnesium. Before the mines were taken over by the South Man- churia Railway, they were producing not more than 360 tons a day. During 191 1 and 191 2, 9,200,000 yen was voted for the first expansion of these mines. The company not only improved the old pits, but opened the Oyama and Togo pits, and increased the daily output to 5,000 tons. The next development opened the Wantawu, Lung- feng, and Hsintun pits, and the open-cut mines at Ku- chengtzu and Chienchinchai. The new sand-flushing method was adopted, with an electrified sand-carrying railway, supplied with current from a Mond gas power plant. The daily output was thus increased to 7,000 tons. The extensive industrial expansion and the use of coal by natives in place of their former fuel of kaoliang neces- sitated the import of coal into Manchuria to the extent of 150,000 tons in 191 8, and 490,000 tons in 1 919. To satisfy the ever-increasing demand for coal by dififerent ipdustries, particularly that of the Anshan Steel Works, 36 MANCHURIA: LAND OF OPPORTUNITIES the company planned another expansion. This was to open three new mines, and combine the two open-cut mines with the view of doubling the output. At present there are two open-cut mines, two perpendicular mines, and six sloping mines with a daily output of 10,000 tons. The Yentai coal mines have a deposit of about 40,000,- 000 tons and the present output is about 400 tons a day. The capital invested in these various coal fields amounts to 40,000,000 yen, and they employ 35,000 workers. Mines not operated by the South Manchuria Railway — In addition to the Fushun mines, there are coal fields at Penhsihu and Hsintai. The former is a semi-anthracite deposit, from two to nine feet deep, and estimated to con- tain 200,000,000 tons. It is suitable for making coke for steel works. The Hsintai mines were opened in 1916, and contain six seams from five to thirty feet thick. Salt — Over the Yellow Sea and the Gulf of Pechili there is little rain and evaporation goes on actively. Therefore, the sea water is brinier, and salt manufacture is conducted very extensively along the sea coasts. At Yingkou, Kaiping, and Fuchou, the salt gardens under the management of the Chinese Government and private individuals lie in an almost unbroken line. The sea water is put in the salt gardens by means of the tide and wind- mills, and is left to evaporate in the sun. The salt in- dustry in conducted vigorously also in the Kwantung Leased Territory. The yearly output averages 150,000,- 000 bushels, of which about one quarter is in Kwantung. Salt is a monopoly of the Chinese Government. The Government buys salt manufactured along the sea coast and sends it to different centres to sell at a specified price. The import of salt into Manchuria is forbidden. Salt produced in Manchuria is debarred from export, except Takushan iron mine at Anshan, Manchuria Salt fields at Pulantien. Along the coast, sea water is put in salt-gardens and left to evaporate in the sun The Oyama shaft at the Fushun Collieries. The daily output of coal at Fushun approximates 10,000 tons American steam shovel at work in the Fushun Colliery NATURAL RESOURCES OF MANCHURIA 37 to Mongolia and the Jehol district. Kwantung salt is exported to Japan and Chosen, and this trade is increas- ing. Natural soda—In Eastern Inner Mongolia are large deposits of natural soda. The low plains, lakes and swamps become white in the dry seasons in spring and autumn. Sometimes the soda forms in layers and presents a beautiful sight. Natural soda is worked at the native soda depots. From spring to summer, crude soda is com- pressed into the form of brick, and from autumn to winter crystallized soda of comparatively fine quality is obtained. In Chelimu Tribe (Inner Mongolia) is located a lake, Tapusu, abounding in soda. On the upper part of the West Liao River there is a plain known as Pali-Shantien Chientzu which also yields a good quantity of natural soda. As means of transportation are developed with the diffusion of civilization, the natural soda of Inner Mon- golia is bound to be exploited. Magnesite — Manchuria abounds with limestone, which usually contains more or less magnesite. Near Tashih- chiao (the junction station for the Yingkou Branch Line) a magnesite deposit of exceptional dimensions has been discovered. It has proved excellently suited to the mak- ing of fire-bricks, and is now supplied to the Govern- ment Steel Works, Edamitsu, Japan, and the Anshan Steel Works. Other minerals — Talc, mica, asbestos, fluorspar, sul- phur, nitre, felspar and silica are also found in Man- churia. The South Manchuria Railway, through its Geological Institute, is encouraging the development of these resources. III. DEVELOPMENT OF MANUFACTURING The new industrial era — Prior to the building of the South Manchuria Railway the Chinese in Manchuria were engaged almost entirely in agricultural pursuits, or primitive manufacturing industries based on agriculture. They pressed oil from soya beans for food and light, ground flour, distilled native drinks, made coarse silk, wove baskets and produced other necessities of life as a by-product of farming. But within a very few years, with the coming of Ameri- can locomotives, steam shovels, mining machinery, elec- tric generators — all the varied labor-saving machines of the modern industrial era— a great change has taken place in this ancient land of the Manchus. Millions of foreign capital, largely from Japan, have poured into Manchuria to be used in developing her rich stores of raw materials, and in establishing new industries for their utiliza-tion. The South Manchuria Railway since its establishment has purchased in America $75,000,000 worth of railway equipment and materials, and machinery for mining, steel-working and other industries. The industrial development of Manchuria along mod- ern lines is being fostered by the South Manchuria Rail- way through the Central Laboratory, the Geological In- stitute, the Agricultural Experiment Stations, the Bureau for Economic Research, and other similar organizations. 38 DEVELOPMENT OF MANUFACTURING 39 The growth of manufacturing in Manchuria is shown by the following reports: Factories in Kwantung Leased Territory (191 8) Factories Port Arthur 15 Dairen 155 Palantien 7 Pitzuwo 20 1918 197 1917 216 1916 204 1915 198 1914 187 1913 202 1912 204 1907 77 Capital (Yen) 539,500 40,880,001 155,000 148,000 41,722,501 36,127,661 33,628,496 21,784,865 20,936,561 20,357,630 22,424,192 1,924,174 Products (Yen) 341,179 109,426,117 603,544 823,483 111,194,323 58,313,003 43,137,839 27,697,647 14,454,438 23,534,072 22,246,852 2,681,868 Factories in Railway Zone (1918) Factories Capital Products (Yen) (Yen) Yingkou 1 55,478 90,000 Wafangtien 14 166,000 869,262 Liaoyang 6 451,712 1,389,510 Anshan 11 370,000 514,585 Mukden 10 10,676,000 3,420,255 Penhsihu 9 7,042.000 8,355,406 Fushun 20 6,913,850 2,143,945 Tiehling 1 3,000,000 2,338,545 Kaiyuan 15 900,000 1,961,217 Changchun 18 4,291,500 3,768,216 Saupingchieh 5 155,000 495,630 Kungchuling 4 85,771 304,156 Antung 17 1,629,000 6,319,688 1918 131 33,736,311 31,970,415 1917 117 29,855,245 29,648,862 1916 92 16,722,531 11,666,113 1915 71 11,593,676 9,773,849 1914 57 3,600,269 6,344,758 1913 53 4,009,131 4,386,513 1912 41 2,448,265 3,681,381 4© MANCHURIA: LAND OF OPPORTUNITIES In North Manchuria and along the line of the Chi- nese Eastern Railway a number of factories are located. In North Manchuria the last published reports showed 1 8 steam flour mills, 30 breweries, i sugar mill and 4 steam lumber mills. Along the Chinese Eastern Railway the last reports showed 13 bean mills, 15 breweries, 13 workshops, 3 tobacco factories, i sugar mill and 12 other factories. Bean oil and bean cake — Bean milling ranks foremost in Manchurian manufacturing industry. Since ancient times the Chinese have used the oil of the soya bean as food and a source of light, but only within the past few years, since the South Manchuria Railway inaugurated its campaign of industrial development, has the soya bean and its varied products become of importance in world trade. Native yufang, or oil mills, are found everywhere in Manchuria, and in these the cake is ground by mules or donkeys and the oil is expressed by hand labor. The residue is bean cake. The Japanese introduced power presses, driven by steam, electric, gas and water power, and most of the modern mills are of this type. A much more efficient method has lately been developed through the research department of the South Manchuria Railway. This is the chemical extraction method. The beans are soaked in benzine until the oil is dissolved. Then, by heating the compound, the oil is separated from the benzine. By this method nearly all the oil in the beans is extracted, and not only is there no waste of oil, but the residue, in this case not in the form of cake but in bulk, is better fitted for fertilizer. By the expression system, 133 pounds of beans give about 12^ pounds of bean oil and two pieces of bean cake each weighing 61 pounds. By DEVELOPMENT OF MANUFACTURING 4I the chemical extraction system the same amount of beans usually gives 17^^ pounds of bean oil and 106 pounds of bean meal. The new method is at present employed by only one company, Suzuki & Company, in Dairen, which firm operates the largest bean-mill in Manchuria. Ying- kou was formerly the center of bean milling in South Manchuria, but Dairen is now far in the lead, with more than sixty mills producing 390 tons of oil and 3700 tons of bean cake a day. The Chinese have used bean cake largely as cattle feed and very little as fertilizer. But recently the cake has found a growing market in Japan and China as a fertilizer as well as cattle feed. To facilitate the shipment and marketing of soya beans the South Manchuria Railway has organized a "mixed storage system." Beans are classified at receiving points, and receipts, negotiable at the bank, are issued, which call for the delivery of like quantities and qualities at terminal points. Flour milling — There are two kinds of flour-mills in Manchuria called respectively mofang and huomo, which literally mean "grinding house" and "fire mill". The for- mer is the native mill which, employing two to ten coolies and four to twelve donkeys, conducts the work on a small scale. This kind of mill is found everywhere in Man- churia, and constitutes the local manufacture only next in importance to distilling and oil-milling. However, mills of this kind are mostly conducted as a by-work by grain merchants, distilleries and oil mills. The "fire mill" is the mill provided with modern machinery to which steam or electricity is applied as the motive power. Flour mills planned on an extensive modern scale in South Manchuria have come into existence under Japan- 42 MANCHURIA: LAND OF OPPORTUNITIES ese management since the close of the Russo-Japanese War. The Manchuria Flour Mill at Tiehling was the first of the kind to be founded. Since then other mills have been established at Mukden, Changchun, Kaiyuan, Kirin and Dairen. A recent Japanese Consular report shows that there are 45 flour mills in Manchuria with an annual capacity of 19,000,000 bags and a market value of $30,000,000. The Japanese mills have a daily capacity of 25,000 bags. The largest company is the Manchurian Flour Mill Company, with a daily output of 17,500 bags in its mills at Harbin, Changchun, Tiehling and Mukden. The Chinese-Japan- ese Flour Mills at Dairen and Changchun have an output of 5,600 bags and the Asia Flour Mills at Kaiyuan pro- duce 2,000 bags a day. There are 36 Russian and Chinese mills with a daily output of 38,400 bags. During 19 19, 1920 and 1 92 1 more than 500,000 tons of Manchurian v/heat was exported to Europe, but this was an unusual movement due to special trade conditions. Normally Manchuria has an import balance of flour. Beet sugar— Ont of the newest industries in Manchuria is the manufacture of beet sugar. An experimental farm was established outside Mukden in 1906, and it was shown that sugar beets could be successfully raised in Man- churia, but the industry was not established until the South Manchuria Railway had conducted successful ex- periments in 1913-1914. The formation of the South Manchuria Sugar Refining Company at Mukden in 1916 by Japanese capitalists followed. The Russians had previ- ously built a factory near Harbin, and a Chinese factory had been established at Hulan, also in North Manchuria. The Mukden refinery was opened with a capital of 10,- 000,000 yen, and has been a great success. Beets are culti- vated over an area of 6,000 acres, supplying the refinery DEVELOPMENT OF MANUFACTURING 43 during the winter months. Crude sugar is imported for refining during the remainder of the year. Distilling — The distilling of beverages for domestic consumption has always ranked as an important native industry in Manchuria. The liquors used by the Chinese are chiefly shumshu (sorghum alcohol), distilled from kaoliang and huangchiu, made from millet. The distill- ing of kaoliang spirit is native to Manchuria. The grain is mashed and steamed, and there is added to the mash barley-malt or bean-malt, and a small quantity of wheat or corn. The cask is buried in the ground for some days and let ferment, after which the contents are distilled. The product is similar to whiskey. Mukden and Liaoyang are the centers of the distilling industry, the output of which is about 13,000,000 yen a year. Brewing — From barley and hops raised in Manchuria, beer is now being made by the Manchuria Beer Brewery Company. The fermenting of sake has also been under- taken at various places. Wild silk — The greater part of the wild-silk cocoons produced in Manchuria have been exported, and Chefoo in Shantung, a center of the silk industry, has reeled much of the Manchurian silk. Small wild-silk filatures are operated by many Chinese farmers in Manchuria who use very primitive methods. The tussah silk produced by the natives has not been of goodquality, and the Dairen Central Laboratory for some time has been devoting much attention to improving the manufacturing methods. As a result, the industry has been developing, especially in Antung. Silk spinning should eventually be one of the largest Manchurian industries. Iron and steel — One of the most ambitious undertak- ings of the South Manchuria Railway has been the build- 44 MANCHURIA: LAND OF OPPORTUNITIES ing of the great steel works at Anshan, to utilize the ore of the Anshan iron mines. Since 1917, when the work was inaugurated, the development of this plan has gone stead- ily forward. Millions of dollars worth of modern equip- ment and machinery was imported from the United States, and the installation has been made under the most approved American engineering practices. Blast furnace No. i with a capacity of 200 tons a day, a charging elevator, four hot stoves, two blowing engines, four boilers, two generators of 3,000 kilowatts each, and settling and cooling ponds, a filter bed, a water tower, etc., were completed in 1918, and the furnace was lighted in April, 1919. Blast furnace No. 2 was completed in 1920. The charging elevator, electric tramway, water circulat- ing system, ore depot, etc., for the second furnace were also installed. Two batteries of coke ovens (one battery consisting of 40 ovens), together with the coal washing system, were finished, and were brought into service early in 1920. Two more batteries were added in the following year. Ultimately it is planned to increase the output to a million tons of iron a year. At Penhsihu another steel works is in operation, pro- ducing 200 tons of pig iron a day. It draws its ores from Miaoerkow, 24 miles away. The capital (14,000,000 yen) is supplied by Chinese and Japanese. Chemical industry — Notable progress has been made in the development of the chemical industry, as a result of the research work of the Dairen Central Laboratory, and the future holds out great possibilities and opportuni- ties. As Fushun coal was found to contain a high percentage of nitrogen (1.6 per cent), a gas producer plant was in- stalled in 1914 to recover the ammonia. A second was put i i'- i 'S'l i :l Decorating bowls in the ceramic factory at Dairen A primitive pottery works in Manchuria Chinese dyers dyeing their cloth in the sun Interior of the Asiatic Tobacco Company factory at Yingkou DEVELOPMENT OF MANUFACTURING 45 up in 1917 and a third is now in course of construction. The daily output is thirty tons of ammonium sulphate and thirty tons of coal tar. Sulphuric acid, calcium carbide, calcium cyanide and other chemicals are being produced. Two sets of sulphuric acid plants, with a daily capacity of fifty tons, have been installed. The beehive coke ovens at Fushun are producing sixty tons of coke a day. An installation of thirty sets of by- product recovery coke ovens is being planned. At Dairen there are the Electro-Metallurgical Com- pany, the Manchuria Barium Industry Company, the Solite Manufacturing Company, the China Electric In- dustry Company, the East Asia Electric Industry Com- pany, the South Manchuria Electricity Company and the Manchuria Paint Company. At Fushun is the Elec- tro-Chemical Company, at Mukden the Mukden Chemi- cal Company, and at Antung the Manchuria Blasting Powder Factory. Cement — The ever-increasing demand for cement in Manchuria, North China and Eastern Siberia on the one hand, and the abundant presence of the material neces- sary for its manufacture, limestone and clay, on the other, induced the Onoda Cement Company of Japan to estab- lish a branch factory in the small town of Choushuitzu, a suburb of Dairen, as early as 1907. The output is 250,000 barrels a year. The factory is ideally situated, the lime- stone being obtained from the hills right behind it and the clay in the field just in front, and a line of railway has been built to connect the factory with the railroad. The factory output consists of cement, paving bricks and build- ing bricks. At Choushuitzu is also located the Dolomite Cement Company, and there is another cement plant at Mukden. 46 MANCHURIA: LAND OF OPPORTUNITIES Glassu:are — With plenty of silicious rock at hand, glass-making has been stimulated by the Ceramic Experi- mental Institute at Dairen, and progress is being made in the commercial development of the industry. Pottery — The pottery division of the Ceramic Experi- mental Institute was transferred to the China Ceramic Company in 1920. Other pottery factories have been started in Mukden, Dairen, Kungchuling and Choushu- itzu, and in addition there are a number of kilns engaged in making firebrick. Wulakai in Kirin has long been a pottery center. Lumber — Many sawmills are now in operation at An- tung, at the mouth of the Yalu, and at Kirin on the Sun- gari River. The lumber industry on the Yalu River has been developed by the Yalu Lumber Company, a Chi- nese-Japanese organization established in 1908 with a capital of 3,000,000 yen. This same company also or- ganized the Yalu Sawmill Company, with a capital of 500,000 yen. At Kirin are located the Mitsui Company's mill, the Kirin Timber Company and a branch of the Yalu Sawmill Company. Other industries — Along the lines of the South Man- churia Railway many new industries have been started since the extension of modern transportation facilities and the opening up of new sources of basic raw materials. The railway is fostering this industrial development through its research work, a description of which is given in Chapter V. Among other Manchurian industries brief mention may be made of the following: Starch is made from beans, kaoliang and corn by the Manchuria Starch Company at Port Arthur and the Dairen Starch Factory at Dairen. At Chientao starch is made from potatoes. DEVELOPMENT OF MANUFACTURING 47 Smoking tobacco is manufactured in the Yingkou and Mukden factories of the East Asia Tobacco Company, which has grown to be a formidable competitor of the British-American Tobacco Company. Smaller tobacco factories are also located at Mukden, Dairen and Chang- chun. Hard oil, stearine, glycerine and soap are made from soya bean oil by the Dairen Fat and Industrial Oil Com- pany, and the Mukden Chemical Company is producing gelatine and animal and vegetable oils. Bean noodles for South China and the South Seas are made by the Chinese-Japanese Bean Noodle Company. Two new companies at Dairen are making imitation rice from kaoliang. The cereal kaoliang, as a result of research work of the South Manchuria Railway, has become useful in many ways. Calcium lactate is an important by-product. Lac- tate acid is made from the calcium lactate and is used ex- tensively in fermentation, dyeing, tanning and other in- dustries. The manufacture of paper from kaoliang pulp is another growing industry. The pulp closely resembles timber pulp and makes an excellent grade of paper. From the ash of kaoliang stalks potassium salts are obtained for use in the manufacture of glass, medicines, fertilizers and other products. Hemp bags and other products are made by the Man- churia Hemp Manufacturing Company at Dairen, and the Manchuria-Mongolia Fibre Industry Company at Mukden. Boat building and repair work is undertaken by the Dairen branch of the Kawasaki Dockyard Company. Railroad car and engine shops, equipped with the best American machinery, are operated by the South Man- 48 MANCHURIA: LAND OF OPPORTUNITIES churia Railway at Shakakou (near Dairen) and Liao- yang. Other iron-working plants are the Dairen Machin- ery Works, the Manchuria Mechanical Works, the An- tung Iron Works and the Osaka Iron Works. Among other Japanese enterprises may be mentioned the manufacture of matches, gunpowder, fertilizer, dye- stuffs and wickerwork. Paper mills at Kirin, Liaoyang and Petuna, and dyeing and weaving works at Yingkou, Liaoyang and Chinchow are among the long-established native industries. Industries based on wool and leather have been re- cently started. Formerly hides, bones, wool and other animal products were exported. At Mukden are located the Manchuria-Mongolia Fabric Industrial Company (capital 3,000,000 yen) and the Manchuria-Mongolia Wool-Weaving Company (capital 10,000,000 yen). Other factories are located at Harbin, Mukden and Dairen. The largest is the Manchuria-Mongolia Sho- kusan Company (capital 5,000,000 yen). IV. COMMERCE AND FINANCE ( I ) Foreign Trade of Manchuria An economic miracle — The American traveler in Man- churia today, who rides in comfort in a Pullman sleeping car behind a Baldwin locomotive, over lOO-pound Pitts- burgh rails; from the modern port of Dairen, with its beautiful plaza, and its great modern banks, business houses and public buildings; and then northward through cities lighted by electricity, with modern railway stations, paved streets, modern hotels, schools, hospitals and scien- tific laboratories; past American-equipped steel works, coal mines and factory buildings — with such a magic transformation before his eyes the traveler finds it diffi- cult to believe that only a few years ago this country was the home of the Manchu rulers of China and a forbidden land to world commerce. Trade was a business of the lowest caste of Chinese, and particularly in Manchuria, as the Manchu Dynasty for- bade the desecration of this sacred ground even by the Southern Chinese. Manchuria for the first time was con- nected with Shanghai, the economic center of China, when the port of Newchwang (now Yingkou) was opened to trade by the Tientsin Treaty (1858) between England and China. But it was half a century later before Dairen, Antung and the other ports of Manchuria were opened to the trade of the world. 49 50 MANCHURIA: LAND OF OPPORTUNITIES A very slow development of Manchurian trade fol- lowed the opening of the port of Newchwang. It was not until 1900 that the Russians began the construction of the Chinese Eastern Railway, which was to give them, in con- nection with their Trans-Siberian line, an outlet on the Yellow Sea at Port Arthur. But the real awakening of Manchuria came with the Russo-Japanese War of 1904, and the taking over of the southern portion of the railway line by the Japanese in 1907 under the terms of the Treaty of Portsmouth. Since then Manchurian commerce has grown tremendously. The gateways of Manchurian trade are Dairen, Ying- kou, Antung and Vladivostok. Of these four the port of Dairen has made the most conspicuous progress. It has now outstripped Tientsin, and leads all other Chinese ports, except Shanghai. Growth of the Port of Dairen — The growth of Dairen as a shipping port is indicated in the following table show- ing the number and tonnage of vessels arriving at the Dairen wharves since 1908 : Vessels Arriving at Dairen Number of Vessels Gross Tons 1908 1909 1910 1911 1912 1913 1914 1915 1916 1917 1918 1919 1920 1,357 1,829,921 1,390 2,238,707 1,542 2,410,885 1,688 2,662,943 1,865 2,872,122 2,117 3,556,250 2,200 3,838,078 2,113 3,461,530 1,942 3,095,257 2,019 3,118,715 2,516 3,473,397 2,891 4,380,920 2,942 4,864,904 MILLIONS or TAELS FOREIGN TRADE OF DAIREN I. Exports: 1910-1921 140 120 lOO ^1 SO 60 ^^H 40 - - 1 - 20 - 1 1 1 1 _ H H 2 w f-l IfS H 1^ 4-1 CO *4 51 52 MANCHURIA: LAND OF OPPORTUNITIES Before the European War the American flag was rarely seen in the port of Dairen, but since the war there has been a very large increase in American tonnage. The follow- ing table shows the tonnage of vessels of the principal maritime nations arriving at Dairen every third year since 1908: Shipping Tonnage Arriving at Dairen: By Countries Japanese Chinese British American Others 1908 1,407,778 31,041 310,756 80,346 1911 1,872,294 55,818 398,141 336,690 1914 3,034,075 98,476 433,909 3,302 268,316 1917 2,628,570 176,853 183,596 8,198 121,498 1920 3,408,369 483,073 421,028 381,729 170,705 The other leading nations represented in the 1920 ar- rivals were: Russian, 34,146 tons; French, 18,277 tons; Norwegian, 1 1,618 tons. Before the war the German ton- nage ranked next to the Japanese and British, reaching 307,000 tons in 1913. A large part of the imports unloaded at the Dairen wharves naturally comes from the neighboring countries of the Far East, but, since the South Manchuria Railway began making heavy purchases in the United States, there has been a very considerable overseas trade. The tonnage of imports from the dififerent countries for 1908 and for the period 191 4- 1920 is shown herewith: Tonnage of Imports Into Dairen: By Countries U.S., Europe Total Tons Japan China Chosen and Others Imported 1908 214,551 14,442 15,584 92,350 336,927 1914 258,865 121,367 17,009 108,533 505,774 1915 240,685 164,062 20,948 111,535 537,230 1916 313,131 194,316 26,689 65,786 599,922 1917 424,065 278,130 35,893 95,180 833,268 1918 466,144 392,952 27,930 69,519 956,545 1919 730,004 528,153 16,887 135,575 1,410,619 1920 588,519 274,730 22,938 88^28 974,215 Sakaki Maru", one of the Da iren- Shanghai steamers Chinese bat-winged junks at Daifen Facilities for quick travel connections are found at Dairen Picturesque lumber rafts on the Yalu River near Antung South Manchuria Railway bridge built over the Hun River near Mukden MILLIONS OF TAELS FOREIGN TRADE OF DAIREN II. Imports: 1910-1921 140 120 - i lOO - 1 80 - 1 ^H ~ 60 - 40 - 1 20 1 1 1-1 r-l 10 r-l 1-1 ■H ■3 H T-t 00 a- T-l T-l r-l S3 54 MANCHURIA: LAND OF OPPORTUNITIES The value of Dairen's foreign trade has greatly in- creased, the total exports and imports being now about seven times as large as in 1908. The record of the mari- time customs trade of Dairen, in Haikwan taels, from 1908 to 1920, is shown in the three tables following: Value of Imports at the Port of Dairen From foreign From Chinese Total imports ports (taels)* ports (taels)* (taels)* 1908 17,215,936 3,060,713 20,276,649 1909 12,239,563 5,301,512 17,541,075 1910 18,634,071 4,081,757 22,715,828 1911 24,012,724 5,773,676 29,786,400 1912 27,069,793 7,803,390 34,873,183 1913 28,740,282 8,310,263 37,050,545 1914 28,891,565 9,002,518 37,894,083 1915 24,865,452 16,581,350 41,446,802 1916 33,358,199 19,073,167 52,431,366 1917 58,274,497 23,690,843 81,965,340 1918 66,979,626 28,622,292 95,601,918 1919 89,521,323 37,855,853 127,377,176 1920 71,040,883 22,028,602 93,069,485 Value of Exports at the Port of Dairen To Chinese To foreign Total exports ports (taels)* ports (taels)* (taels)* 1908 5,069,133 7,342,402 12,411,535 1909 4,435,915 22,308,444 26,744,359 1910 6,077,480 20,115,933 26,193,413 1911 9,724,395 24,006,581 33,730,976 1912 9,090,823 19,795,121 28,885,944 1913 9,298,702 29,749,041 39,047,743 1914 8,504,480 36,601,327 45,105,807 1915 15,171,438 33,714,202 48,885,640 1916 11,572,920 43,135,327 54,708,247 1917 16,163,469 47,023,741 63,187,210 1918 13,623,491 72,389,242 86,012,733 1919 7,767,101 97,243,766 105,010,867 1920 16,842,406 108,223,857 125,066,263 ^Chinese customs returns are reported in Haikwan silver taels. The exchange value of the tael varies with the price of silver. From 1908 to 1915 the average value of the tael in United States currency was 67 cents. In 1916 it was 79 cepts; 1917, $1.03; 1918, $1,26; 1919, $1.39; 1920, $1.24. COMMERCE AND FINANCE 55 Exports and Imports: Port of Dairen Imports Exports Total (taels)* (taels)* (taels)* 1908 20,276,649 12,411,536 32,688,184 1909 17,541,075 26,744,359 44,285,434 1910 22,715,828 26,193,413 48,909,241 1911 29,786,400 33,730,976 63,517,376 1912 34,873,183 28,885,944 63,759,127 1913 37,050,545 39,047,743 76,098,288 1914 37,894,083 45,105,807 82,999,890 1915 41,446,802 48,885,640 90,332,442 1916 52,431,366 54,708,247 107,139,613 1917 81,965,340 63,187,210 145,152,550 1918 95,601,918 86,012,733 181,614,651 1919 127,377,176 105,010,867 232,388,043 1920 93,069,485 125,066,263 218,135,748 Dairen's export trade is largely made up of agricultural products and coal. In tonnage, soya bean products are more than sixty per cent of the exports. The growth of the export trade in the principal items since 1908 is shown in the following table: Commodities Exported from Dairen {in Tons) 1908 1911 1914 1917 1920 Beans 182,629 272,457 255,112 191,780 567,129 Bean cake .. 204,627 446,801 512,823 852,867 1,131,208 Cereals 13,781 97,004 118,259 198,684 707,237 Coal 7,703 91,115 559,761 494,645 212,589 Sundries .... 28,646 39,285 98,518 258,332 278,935 Total .... 437,386 946,662 1,544,473 1,996,308 2,897,098 Bunker coal.. 15,276 55,322 247,193 206,131 195,428 Foreign trade of Manchuria — With the development of the port of Dairen, the gateway to Manchuria, the for- eign trade of the country has grown apace. Three years after the Russo-Japanese War, when Dairen and Antung were opened to commerce, the total trade reached $40,- 000,000. In the first year after the close of the European War it had risen to nearly $500,000,000. The foreign ^See note page 54. , . 56 COMMERCE AND FINANCE 57 trade returns for the ten years, 1911-1920, are as follows: Foreign Trade of Manchuria {in U. S. Dollars) Imports from Imports from Total foreign ports Chinese ports imports Exports Total trade 1911.... ... $44,534,998 $17,937,313 $63,472,311 $64,924,367 $128,396,678 1912.... ... 56,317,522 11,976,123 68,293,645 63,971,900 132,265,545 1913.... . . . 54,235,006 15,694,743 69,929,749 68,686,000 138,616,749 1914.... . . . 49,572,049 12,200,072 61,772,121 59,222,365 130,994,4«6 1915.... . . . 37,596,850 13,087,901 50,684,751 62,976,622 113,661,373 1916.... . . . 65,640,144 16,654,894 82,295,038 77,918,602 160,213,M0 1917.... ... 116,163,316 24,370,924 140,534,240 130,603,813 271,138,053 1918.... ... 127,292,793 42,229,907 169,522,790 149,251,197 318,773,987 1919.... ... 209,637,624 56,668,535 266,206,159 224,041,347 490,247,506 1920.... ... 156,990,557 50,923,282 207,913,839 221,517,637 429,431,476 Principal exports and imports — Manchuria exchanges her raw materials for the manufactures of other countries. She imports little raw material, and exports few manu- factures. The country is still primarily agricultural, al- though manufacturing is rapidly developing. The soya bean is the foundation of her trade, comprising about half the value of all exports. The values of the principal ex- ports in 1920 were as follows: Bean cakes $60,236,000 Beans 35,098,000 Bean oil 22,131,000 Wheat 28,214,000 Other cereals 19,651,000 Coal and coke 8,688,000 Wild silk yarn 7,680,000 Wild silk cocoons 2,627,000 Kaoliang 7,122,000 Lumber 3,935,000 Corn 2,672,000 Metals 2,488,000 Values of some of the principal imports in 1920 were: Cotton goods $62,099,000 Cotton yarns 17,009,000 Metals 14,477,000 Machinery 8,531,000 Tobacco 9,090,000 Fabrics (other than cotton) 8,084,000 Bags 7,347,000 Kerosene 6,087,000 58 MANCHURIA: LAND OF OPPORTUNITIES A more detailed picture of the foreign trade of Man- churia is presented in the following analysis of the imports and exports for 1920, as reported by the American Consul General at Mukden: Imports Into Manchuria — 1920 Quantities Values Bags pieces 34^08,191 Belting machine $194,775 Building materials 559,097 Butts and hinges 123,624 Cement pounds 88,121,411 Cotton, and manufacturers of. Blankets pieces 187,678 Canvas and cotton duck pieces 547,957 Chinese cotton goods — Drills pieces 64,047 Nankeens pounds 4,286,590 Sheetings pieces 484,674 Yarn pounds 8,631,612 Drills- American and English pieces 10,064 Japanese pieces 135,778 Handkerchiefs dozen 154,103 T ., ,. ,. , ^, (yards 55,341,956 Imitation native cloth ^^j^^^^ gg4jfj2 Japanese cotton cloth yards 1,545,827 Poplins, cotton Italians, Venetians, crepe, dyed drills and lastings pieces 379,553 Prints, plain cotton pieces 146,292 Sheetings- American and English pieces 45,546 Japanese pieces 3,770,623 Shirtings — White pieces 731,310 Grey — American and English pieces 62,993 Japanese pieces 1,661,952 Towels dozens 280,332 Thread — In balls pounds 49,077 On spools gross 184,257 Velvets and velveteens yards 174,464 Yarns — English Indian pounds 2,069,081 Japanese pounds 15,956,143 Electrical materials and fittings 2,013,541 Flour, wheat pounds 10,826,333 Haberdashery 236,776 Hardware 250,964 Leather 1,509,938 Machinery 2,601,149 Matches gross 1,157,902 Medicines 872,924 COMMERCE AND FINANCE .pounds Metals and minerals — Brass bars, sheets, etc Copper— Bars pounds Ingots and slabs jwunds Graphite pounds Iron — Bars pounds Angles and tees pounds Nails and rivets pounds Pig pounds Sheets and plates pounds Galvanized sheets pounds Lead in pigs and bars pounds Steel ("sheets, plates, etc.) pounds Tin in slabs pounds Tinned plates pounds Oil- Kerosene— American gallons Japanese gallons Russian gallons Sumatran gallons Lubricating gallons Paper pounds Railway materials Rice pounds Shoes, leather pairs Soap — In bars pounds Toilet Soda pounds Stationer.' Sugar : Brown pounds White pounds Refined pounds Candy pounds \"ehicle5 — Locomotives and parts Motor cars Quantities 2,473,002 105,868 9.736,082 718,-;66 2U55,528 8,010,191 7,601.083 9.652.6(}8 15,391,159 6,651,596 1,045,64-6 2,604.938 241.661 5.465,901 11,1388.123 309,545 9+5,154 3208,181 1.955.464 76.556,928 27,653.227 418,723 3,226.048 13^49,661 11,443,852 12.046,475 19.59-1.491 1.193.143 Exports from Manchuria — 1920 Quantities Bean cake tons 1.280,801 Bean meal pounds 28,526.106 Beans tons 597.942 Bristles pounds 364.7.54 Cement pounds 17,958.965 Cereals — . Barley pounds 14,263,984 Buckw-heat pounds 5,670,854 Kaoliang pounds 232,360.842 Maize pounds 85,886.612 Millet pounds 301,282,373 Rice pounds 11,822.769 WTieat tons 546.293 Coal tons 852,934 59 Values 994,334 369,114 55V,636 533,106 871,105 361,597 \*alues 6o MANCHURIA: LAND OF OPPORTUNITIES Quantities Values Flour, wheat pounds 92,355,466 Ginseng pounds 347,397 ....... Grass cloth $1,435,148 Groundnuts pounds 15,815,562 Hides pounds 1,977,444 Iron, pig pounds 83,277,091 Manure, ammonia pounds 17,572,093 Gil- Bean pounds 242,359,649 Castor pounds 4,138,029 Groundnut pounds 4,153,590 Salt pounds 181,107,829 Seed — Castor pounds 5,630,954 Hemp pounds 29,447,397 Linseed pounds 3,936,002 Melon pounds 22,481,059 Perilla pounds 52,508,400 Sesamum pounds 39,232,739 Silk- Raw, wild pounds 314,827,625 Cocoons pounds 194,793,245 Waste pounds 87,973,245 Pongees pounds 10,401,644 Skins and furs pieces 321,271 Tobacco, leaf pounds 21,280,000 Wool, sheep's pounds 1,493,723 Trade with the United States — A very considerable part of the overseas trade of this rapidly developing coun- try is with the United States, because it is to America that the builders of Manchurian industries have turned for modern machinery and railway materials. American manufacturers have found an open door in Manchuria for their products, and the return tide of Pacific traffic has brought to the United States an increas- ing flow of the products of the rich soil of Manchuria. The South Manchuria Railway has purchased in the United States $50,000,000 worth of locomotives, cars, rails and other materials, and the industries developed by it in the railway zone have imported $25,000,000 worth of machinery and materials. In contrast to this open door for American products in Manchuria the Far Eastern Re- view stated that railways in neighboring provinces of China had purchased $67,500,000 of materials in Europe, but none in America. hSHHBBSIIBMK Travel througli Manchuria affords magnificent views of mountain scenery The great steel bridge across the Yalu River at Antung. connecting the South Manchuria Railway and the Chosen State Railways Chinese farmers fording the river at Penhsihu South Manchuria Railway bridge at Chiaotou Yei-an bridge at Fushun, South Manchuria Railway COMMERCE AND FINANCE 6 1 Manchuria, as its latent resources continue to be de- veloped by modern engineering and agriculture, will oflfer greater and greater opportunities to American trade. The record of Manchuria's trade with the United States for the past few years is as follows: Imports from Exports to United States United States 1910 $1,212,582 $8,671 1911 1,300,169 20,400 1912 1,444,318 4,493 1913 1,689,215 88,629 1914 3,401,336 479,972 1915 1,784,305 280,492 1916 1,673,092 1,724,091 1917 6,293,941 16,399,301 1918 15,323,807 35,766,620 1919 27,678,116 14,474,853 1920 15,871,554 16,514,377 (2) Facilities for Commerce. Railways — More than 2200 miles of railway are now in operation in Manchuria. These lines are as follows: South Manchuria Railway — 686 Miles Mileage South Manchuria Railway, Main Line, Dairen-Changchun. . . 439 Mukden-Antung Line, Suchiatun-Antung 162 Ryojun (Port Arthur Branch, Chouchuitzu-Ryojun) 29 Fushun Branch, Hunho-Fushun 33 Yingkou Branch, Tashihchiao-Yingkou 14 Yentai Colliery Branch, Yentai-Yentai Colhery 9 Chinese Government Railways — 522 Miles Miteajre Kirin-Qiangchun Line, Changchun-Kirin 79 Ssupingkai-Taonan Line, Ssupingkai-Paiyintailai 125 Part of Peking-Mukden Line, Mukden-Shanhaikwan 261 Yingkou Branch Line, Yingkou- Koupantzu 57 Railways Under Russo-Chinese Management — 1,078 Miles Chinese Eastern Railway — Mileage (Western Section) Manchouli-Harbin 584 (Eastern Section) Harbin-Pogranichnaya 341 (Southern Section) Harbin-Kwanchengtzu 148 Jalainor Colliery Branch Line 5 62 MANCHURIA: LAND OF OPPORTUNITIES When the Kirin-Huining Railway, together with five proposed railways in South Manchuria and Inner Mon- golia are completed and opened for operation, 1500 ad- ditional miles of line will be added to Manchuria's trans- portation facilities. Waterways — The navigable rivers in Manchuria and Mongolia are the Liao in the south, the Yalu in the east, and the Sungari and the Amur in the north. The Sun- gari and the Amur admit of the greatest exploitation. Be- fore the railway was built, the Liao served as the only highway of trade in South Manchuria, but now its old glory has vanished. Some 1500 junks are in operation on the Liao and the river is still a trade channel of impor- tance to interior Mongolia. The Yalu and Liao Rivers remain ice-bound from December to March, while the ice-bound period on the Sungari and the Amur extends from November to April. Ocean steamship services — With the rise of the port of Dairen to second place among all the ports on the China coast, and the development of the harbor facilities for berthing ocean steamships and handling freight, ship- ping offices of all the shipping companies with Pacific routes have been established at Dairen. The "Com- mercial Handbook of China," published by the Bureau of Foreign and Domestic Commerce, Washington, gives the following summary of the steamship services at Darien: The steamship lines with ocean-going vessels calling regularly at Dairen are as follows : Osaka Shosen Kaisha: Dairen-Kobe (via Moji) ; twice a week; four vessels. Dairen-Nagasaki (via Korean ports); monthly; one vessel. Tientsin-Takao, Formosa (via Dairen and Chinese ports) ; thrice a month; three vessels. Nippon Yusen Kaisha: Yingkou- Yokohama (via Dairen, Tient- sin, Chemulpo, Kobe) ; thrice a month; three vessels. COMMERCE AND FINANCE 63 South Manchuria Railway Company: Dairen-Shanghai (via Tsingtau) ; twice a week; two vessels. In addition to the services listed above, passenger and freight ves- sels from the following lines occasionally call at the port : Ocean Steamship Co., China Navigation Co., Indo-China Steam Naviga- tion Co., Glen Line, Shire Line, Royal Mail Steam Packet Co., Indra Line and Bucknail Steamship Co. As will be noticed, there are no American steamship lines repre- sented in the above lists. It is therefore necessary for the American shipper to send his cargo to Yokohama or Kobe and have it trans- shipped there to one of the Japanese Hnes to be forwarded to Dairen, unless, of course, a full cargo can be made up and sent directly to Dairen by a tramp steamer. Steamship lines now operating to Dairen — The fol- lowing steamship lines are now operating to Dairen: Toyo Kisen Kaisha : Dairen-San Francisco, via Yokohama, Hong- kong and Honolulu ; two sailings per month. Osaka Shosen Kaisha: Dairen-Osaka, via Moji and Kobe; two sailings per week. Seattle, Tacoma via Kobe; three steamers; stop at Dairen on eastbound voyage. New York via Panama ; three steamers ; stop at Dairen on eastbound voyage. European line via Suez; two steamers; stop at Dairen on outward voyage. Nippon Yusen Kaisha : Osaka-Newchwang via Kobe and Dairen ; sailing every nine days. Service suspended during winter months. Yokohama-North China Line (Dairen-Seattle) ; three steamers. Stops at Dairen on eastbound voyage. Dairen Kisen Kaisha: Tientsin-Dairen-Tsingtao-Shanghai; two sailings per month. Chosen Yusen Kaisha : Dairen-Tsingtao-Chemulpo ; three sailings per month. To-wa Kisen Kaisha : Dairen-Lungkow ; three sailings per month. Chingkee Steamship Company : Dairen-Chefoo ; twelve sailings per month. Awakyodo Kisen Kaisha : Dairen-Tsingtao. Dairen-Chemulpo. Norton Lilly Company, 26 Beaver Street, N. Y. C. : General agents for companies having steamers leaving Atlantic Coast Ports for Dairen. Barber Steamship Lines, 17 Battery Place, N. Y. C. : Have steam- ers leaving Atlantic Coast Ports for Dairen. Posts, telegraphs and telephones — Along the line of the South Manchuria Railway, postal, telegraph and tele- 64 MANCHURIA: LAND OF OPPORTUNITIES phone systems are organized and operated by the Japan- ese authorities. More than 700 miles of telegraph lines and 1,000 miles of telephone lines (the two services using more than 20,000 miles of wires) have been installed. Chinese post-offices are maintained in all towns outside Kwantung, in which territory the postal service is oper- ated by the Kwantung Government. Communication facilites are constantly being improved and expanded. Warehousing — A number of warehousing and for- warding companies are in operation in the principal towns along the South Manchuria Railway. The rail- way maintains warehouses and storage yards at the Dairen wharves and at the principal railway stations. Insurance — Branches of the leading Japanese, English and American insurance companies are maintained at Dairen. At the end of 1919 there were 61 insurance offices in Kwangtung Territory, 130 in the South Man- churia Railway Zone, and 93 outside of the zone. The total amount of insurance in force was 666,800,000 yen. Freight at the Dairen wharves is insured by the railway company, by arrangement with a number of insurance companies, and this insurance is voluntarily efifected by the South Manchuria Railway without charge to the owners of the goods. Banking — Manchuria has adequate, modern banking facilities, the great Japanese and foreign institutions main- taining branches in Dairen and other cities. In addition there are a number of local institutions. The Japanese banks maintain twenty-six main offices and sixty branch offices, while the Chinese banks have eleven main offices and seventy branch offices. The Bank of Chosen ($25,000,000 paid-up capital) and the Yokohama Specie Bank ($50,000,000 paid-up COMMERCE AND FINANCE 65 capital) are the largest institutions maintaining branches in Manchuria. They have built imposing banking houses in Daircn, which are among the most beautiful structures facing the plaza. The principal banks in Manchuria are as follows : Japanese Authorized Capital Bank of Chosen yen 80,000,000 Yokohama Specie Bank yen 100,000,000 Chenlung Bank yen 20,000,000 Dairen Bank yen 3,000,000 Liaotung Bank yen 3,000,000 Lungkow Bank yen 11,000,000 Dairen Commercial Bank yen 2,275,000 Bank of China yuan 60,000,000 Bank of Communication tael 15,000,000 Three-Eastern Provincial Bank yuan 600,000 Mukden Industrial Bank yuan 13,000,000 Kirin Provincial Bank tiaos 1,500,000 Heilungkiang Provincial Bank tael 404,998 Frontier Development or Territorial Bank. . . .silver yen 2,000,000 Foreign Russo-Asiatic Bank rubles 55,000,000 Hong Kong & Shanghai Banking Corporation . silver yen 20,000,000 International Banking Corporation $10,000,000 Chinese-French Commercial Bank francs 45,000,000 Currency — As in other parts of China, there are many kinds of currency in circulation. The foreign bank-notes exert a great influence, and it is mainly through them that the foreign trade of the country is actually carried on. These bank-notes circulate in large amount, and within the limits of the Leased Terri- tory and the Railway Zone are practically the sole cur- rency. It should be noted, however, that, outside these limited places, their circulation is greatly modified, be- cause, though they are used very extensively and freely for all trading purposes, mutual transactions between the natives are carried on in native currency. 66 MANCHURIA: LAND OF OPPORTUNITIES The "Economic History of Manchuria" gives the fol- lowing table of monies in circulation in Manchuria: rCash (chuhchien), Copper coin {tung- Coins < yuan), Silver dollar (yangchien). [ Sycee {y in ting). fGovemment notes (kuantieh), Copper Notes < coin notes (tungyuanpiao) , Silver dol- I lar notes (yangchienpiao) . Chinese currency < Foreign currency Coins /Japanese silver yen, Mexican dollar, Jap- L anese and Russian subsidiary coins. Japanese military notes, Bank of Japan notes, Bank of Chosen notes, Yokohama Specie Bank notes, -Russian ruble notes. Notes Trade organizations — Chambers of commerce are maintained at Dairen, Mukden, Antung, Changchun, Yingkou and other cities. At every trade center there is a Chinese guild. The Dairen organization publishes periodical reports on the trade and industry of Man- churia. The Dairen Produce Exchange was established in 1913 ; in 1915, a produce and currency exchange was opened at Kaiyuan, and another at Changchun in 191 6. In 19 17, a currency exchange was established in the Dairen Produce Exchange, and now the produce and currency exchanges are known as the Dairen Exchange. In 191 9, produce and currency exchanges were opened at Kungchuling, Ssupingkai and Tiehling, and in 1920, at Mukden, Ying- kou and Liaoyang. In addition stock and merchandise exchanges have been founded at Dairen, Mukden and Antung under private management. On these exchanges there is trading in beans, bean cake, kaoliang, bean oil, wheat, Italian millet, etc., gold notes issued by the Bank of Chosen, Russian ruble notes, silver COMMERCE AND FINANCE 67 notes issued by the Yokohama Specie Bank, Chinese small silver coins, and Chinese small silver coin notes. In Man- churia, owing to the great variety of currencies in circula- tion and more particularly because of the constant fluctu- tations in their exchange rates, the currencies have come to be looked upon as commodities. Because of this pe- culiar feature in the currency situation in South Man- churia, the exchanges are under Government manage- ment; and in order to guarantee delivery and to settle accounts between sellers and buyers, a trust and guaranty company under private management is attached to each exchange. For the purpose of providing long-term capital to de- velop the country, there have been organized the Oriental Developing Company, the Eastern Enterprise Company and the Manchurian Enterprise Company. These financial institutions make loans against lands and buildings. A commercial museum was established in Tiehling in 1906. Similar institutions were opened later in Chang- chung, Antung and Harbin. The Kwangtung Govern- ment recently established in Port Arthur the Manchuria- Mongolia Production Museum. V. THE SOUTH MANCHURIA RAILWAY AND ITS WORK (i) A Modern Railway in an Ancient Land The Treaty of Portsmouth — From Portsmouth, New Hampshire, to Manchuria, is a far cry. Yet in the mat- ter of the South Manchuria Railway Company there is an important association between them. In 1905 the Peace Treaty between Russia and Japan was signed at Portsmouth. By this Treaty the southern portion of a great railway running through Manchuria from Chang- chun southward to the port of Dairen, and originally the property of Russia, was transferred to Japan. In 1906, by Imperial ordinance, the South Manchuria Railway Company was founded and the railway properties were taken over. Since then the South Manchuria Railway has opened up the richest portion of China, heretofore undeveloped, and has made it a dominating factor in industrial and com- mercial enterprises, as well as an inviting country for the world-traveler. Today, Manchuria has better railroad facilities than any other part of China. Western civilization in the East — The South Man- churia Railway has not been content to develop merely the material resources of the rich territory it serves; it has bent its energies to the spread of modern civilization in this ancient land of the Manchus. To accomplish this, it 68 jii J^SU, '*n 1 lilt Yamato Hotel at Port Artliur it SI*'*' 1 '■ * li uf V.^V^^& '■'■■-'>^* *':»■■■*■ ■ "•■ ■ '•■''Si;.-"' ■ . V ■ %^-^^M ^:^^^;:, :■■ -^^^ 1 ' 'j''V}! 1 '■ • -^ 1 \uJ " "^ ^'^^B ^yK>- \ ;' 1 ■fllM : - -"."H^ »r '■■■ . f fc"" *' f - """''' i'i^.. -* i'm 'las !^ ^m ■ ' ■ :: il^>- _... -^-O-.-^ 1HII^''''< 1 , -^ H ^^*l Yamato Hotel at Changchun Yokohama Specie Bank, Dairen r «|Tffiifirn?ij . "Y ' i ft ii ynfrj mwrm iw "■ "t 'Tr~TTrrrnn— -ywi Bank of Chosen, Dairen SOUTH MANCHURIA RAILWAY AND ITS WORK 69 has built cities and administers them; it operates coal mines, steel works, waterworks, electric and gas plants, and a chain of hotels; and maintains schools, hospitals, laboratories and experiment stations. Along the line of the railway there have sprung up modern cities. These settlements within the railway zone, built and administered by the officers of the South Man- churia Railway Company, are amazingly like new west- ern towns in the United States. They are enterprising, modern, beautifully laid out, and afford every educa- tional, sanitary, civic and industrial advantage. These settlements often lie in close proximity to old Manchu cities, and indeed form part of them. This railroad uses an all-American equipment of loco- motives, coaches and rails. The shriek of these American locomotives across Manchurian plains and through Man- churian cities is the voice of modern enterprise bringing a rich, modern life, opportunity, hygiene, education and happiness to an ancient people. Some writers have compared this great railway com- pany, with its varied transportation, agricultural, indus- trial and civic interests to the famous trade adventuring companies of 300 years ago. But a Japanese writer, in the "Economic History of Manchuria," points out that the South Manchuria Railway Company is a very differ- ent kind of venture. He says: "Of the nature of the company, the author has heard people compare it, not so often nowadays as at the time of its establishment — and take delight in so comparing it — with the East India companies established by England, Holland, France, and other European countries in the course of the 17th and i8th centuries. But nothing is further from the truth. Those East India companies. 70 MANCHURIA: LAND OF OPPORTUNITIES ostensibly trading corporations, were in fact political or- ganizations with even military powers conferred upon them by their respective Governments, whereas the South Manchuria Railway Company is an economic institution, pure and simple, in both name and reality. It has no hand even in the policing of its own railway zone, and has no power whatever over the soldiery stationed in Man- churia.* Nor is there anything, even in its economic rights, that bears a semblance of the sole right of trading with the East Indies. The difference is too clear to need further comment. That it was modelled to a great extent after the Chinese Eastern Railway Company there seems little doubt. Indeed, it could not be otherwise, since in many respects the company is nothing but the successor in South Manchuria of that Russian company. But in the organization of the South Manchuria Railway Com- pany there is nothing of the vagueness that enshrouded that of the Russian company. It was established by a special charter of the Government, but essentially as a joint-stock company organized according to the commer- cial law of Japan." Activities of the company — The principal enterprises of the South Manchuria Railway Company are these: Railways — The company owns and operates 686 miles of railway lines in South Manchuria, and also operates the Chosen State Railways with a mileage of 1 153. The railway properties include modern car shops and locomotive repair shops, modern terminals and an extensive system of warehouses on the sea- coast and along the lines. Shipping — An ocean service between Dairen and Shanghai. (Sold to Dairen Steamship Co.) *A military and police guard are maintained by the Kwautung Government along: the rnilway zone for protection against robbers. — Editor's Note. SOUTH MANCHURIA RAILWAY AND ITS WORK 7 1 Harbors — Docks, wharves and warehouses at Dairen, Yingkou, Antung and Shanghai. Dairen has been made the best equipped harbor in the Far East, with a capacity of docking at one time fifty vessels of 85,000 tons. Coal mines — Bituminous mines at Fushun and Yentai, equipped with modern American equipment, and with reserves of 1,200,000,000 tons. Steel works — A modern steel plant at Anshan, with an ultimate annual capacity of 1,000,000 tons of steel, to utilize the ore of the Anshan mines, the reserves of which are estimated at several hundred million tons. Electricity and gas — Electric light and power plants in Dairen, Antung, Fushun, Mukden and Changchun, and electric street railways in Dairen and Fushun, the total annual output reaching 20,- 000,000 kilowatts; a large gas plant in Dairen, with a production of 215,000,000 cubic feet a year, and a smaller plant at Anshan. Hotels — A chain of modern hotels along the line of the railway, including Dairen, Port Arthur, Muk- den, Changchun and the seaside resorts, Hoshigaura and Ogondai. Research bureaus — The Central Laboratory in Dairen is charged with the study of the utilization of agricultural and other products, and the study of public health problems. The Geological Institute in Dairen makes mineral and soil surveys and analy- ses. Agricultural Experiment Stations are operated at Kungchuling and Hsiungyocheng, and in addition there are sixteen nurseries, and experimental farms at Telissu and Chengchiatan. 72 MANCHURIA: LAND OF OPPORTUNITIES Civic planning and administration — Under direc- tion of the Japanese Government, the railway under- takes town planning, organizes sanitation, conducts schools and hospitals and lends its aid to civic better- ment work. Financing a great enterprise — The capital expenditures made by the South Manchuria Railway in the various enterprises in which it is engaged are shown in the table below. For the fifteen years ending March 31, 1922, these investments, including the appraised value of the properties taken over by the company in 1906, totalled 474,000,000 yen ($237,000,000). When it is considered that the greater part of this amount was expended at pre- war prices for labor and materials, and in a country where wage rates are only a fraction of those prevailing in the United States, it can be estimated that this property invest- ment of $237,000,000 is easily equivalent to an expenditure of several times that amount in America or Europe today. Including the value of the properties taken over in 1907, appraised at 92,780,978 yen, the total investment at the end of the fiscal year 1920-21 and the proportion of the total investment in each department, was as follows: Yen Percentage Railways 166,225,463 38.6 Mines 94,076,277 21.8 Buildings 37,648,697 87 Steel Works 32,647,334 7.6 Harbors 30,692,418 7.1 Lands 18,752,159 4.4 Industries 11,580,678 27 Local Institutions 11,347,116 2.6 Electricity 10,303,118 2.4 Workshops 9,795,220 2.3 Gas 2,949,984 .7 Steamships 2,392,002 .6 Hotels 2,280,832 .5 Total 430,691,247 100.0 SOUTH MANCHURIA RAILWAY AND ITS WORK 73 The record of capital expenditures since 1906 follows: Uriginal 111- Railways Workshops Steamships Harbors Mines Steel Works vestment by Yen Yen Yen Yen Yen Yen J a p a nese Government 25,719,896 332,216 6,209,134 46,013,892 1907 9,464,713 691,046 523,310 665,108 1908 22,145,348 336,873 1,582,730 2,832,629 1909 8,276,670 867,889 1,610,788 1,989,976 1910 14,096,718 2,444,648 2,616,619 2,120,071 1911 11,809,955 1,342,432 2,812,434 682,662 1,389,058 1912 4,506,378 232,229 572,923 1,645,684 1,501,751 1913 1,962,590 149,708 1,507,279 2,304,183 1,748,556 1914 1,235,928 196,394 77,799 1,629,919 2,795,049 1915 693,911 154,749 79,277 1,267,184 2,449,553 1916 1,769,775 370,139-1,905,679* 1,781,132 -21,448* 1917 2,621,613 650,275 -463,717* 2,337,646 2,873,131 4,447,760 1918 5,407,393 532,324 -156,448* 2,573,464 4,209,561 4,900,572 1919 25,893,469 903,900 -145,461* 3,575,641 8,318,659 28,342,328 1920 34,167,049 789,627 13,596 443,930 15,473,638-5,043,327* Total 166,225,463 9,795,220 2,392,002 30,692,418 94,076,277 32,647,334 Original in- Electricity, Local In- vestment by Gas, etc. Hotels stitutions Lands Buildings Total Taoanese Yen Yen Yen Yen Yen Yen Government. 367,232 13,539 313,441 6,043,944 7,770,685 92,780,978 1907 112,709 202,764 341,812 2,047,296 14,048,758 1908 887,887 25,078 -7,531*2,279,310 2,396,329 32,478,657 1909 2,435,202 404,375 587,765 945,597 776,175 17,894,437 1910 1,259,745 317,278 505,497 1,961,024 2,170,152 27,491,750 1911 861,124 125,178 704,231 2,162,387 1,654,319 23,543,780 1912 683,571 253,894 487,923 1,056,498 655,251 11,596,102 1913 -196,472* 288,657 1,397,241 1,367,059 851,675 11,380,478 1914 256,343 399,656 723,864 850,113 989,961 9,155,026 1915 155,741 16,168 -205,612* 221,235 185,245 5,017,451 1916 2,628,032 11,288 866,472 517,135 270,951 6,287,797 1917 2,873,101 17,131 1,200,364 218,395 869,534 17,645,233 1918 2,865,094 61,950 1,032,856 455,559 1,112,506 22,994,842 1919 4,424,632 93,728 1,643,742 2,819,646 6,128,403 81,998,687 1920 5,233,928 50,147 1,781,259-1,975,183*10,400,390 61,335,053 Total 23,048,322 2,280,832 11,347,116 18,752,159 37,648,697 430,691,247 (2) The Railway Road and equipment — Originally built by the Russians in 1900-01, what is now known as the South Manchuria Railway was a cheaply-constructed, poorly-equipped rail- * Decreases in capital expenditures are the result of aalea of property to other com- panies, transfers from one department to another, and depreciation written off. 74 SOUTH MANCHURIA RAILWAY AND ITS WORK 75 way, of strategic military value, but absolutely inadequate for the commercial development of a growing country. The main line from Port Arthur on the Yellow Sea north- ward to Changchun (436 miles) was originally con- structed by the Russians on the Russion 5-foot gauge. During the Russo-Japanese War, the field railroad divi- sion of the Japanese Army reconstructed this road as a narrow-gauge military line, and the Japanese Army also built a narrow-gauge line northward from Antung during the advance on Mukden. The South Manchuria Railway Company, when it ac- quired these lines, immediately began a comprehensive program of reconstruction. The lines were rebuilt and double-tracked on the standard gauge used in America; curves were straightened, grades were reduced by the re- building of roadbeds and the construction of tunnels; modern steel bridges were thrown across the rivers; heavy rails, locomotives, freight and passenger cars were brought from the United States; the number of stations was increased from 54 to 114; modern station buildings were built at all important points, and new workshops, roundhouses and warehouses were installed; in a word, a standard American railway was constructed in place of the old Russian line. In the rebuilding of the Mukden- Antung line, for ex- emple, $12,000,000 was expended. In this work the most difficult pieces of engineering were the excavation of the tunnels piercing Fuchinling, 4,884 feet in length, and the Chikuanshan, 3,254 feet in length, and the bridge over the River Taitze, 1,779 ^^^^ in length. This whole work, in- clusive of 24 tunnels, 205 bridges and 213 culverts, was completed in twenty-six months. The work was carried on uninterruptedly through severe winter weather and the heavy rain storms of summer. 76 MANCHURIA: LAND OF OPPORTUNITIES The equipment consists of 340 locomotives, including nearly all the types familar on American roads; 5,624 freight cars, including 2,224 box cars, 2,374 ^^t cars, and a full equipment of coal, ore, sand, oil-tank, water-tank, refrigerator and caboose cars; and 328 passenger cars, in- cluding compartment Pullmans and American dining cars for the express trains. The South Manchuria Ex- press, an excess-fare through train, which makes the 436- mile run from Dairen to Changchun in 15 hours, has been called the "20th Century Limited of the Far East." On this de-luxe train, the first- and second-class sleeping cars are all compartments. Through service between Europe and Dairen, via the Trans-Siberian route, was inaugu- rated in 1908, but had to be suspended when the war came. Railway shops — The new car and locomotive shops at Shakakou, near Dairen, are among the largest and best equipped in the Orient, and have their own waterworks. The area comprises about 230 acres, of which about 11 acres are covered with offices and workshops. The shops have a capacity of simultaneously executing repairs on 27 locomotives, 36 passenger cars, and 130 freight cars. Of the rolling stock now in use by the company, 6 locomotives, 25 passenger cars and 461 freight cars were constructed at these shops. Orders from the Chosen State Railways and the Chinese Government Railways have also been filled. Adjoining the workshops is a village for the em- ployees, containing about 700 houses covering a little more than six acres, which is undoubtedly one of the pleas- antest spots in the country around, with finely laid out streets, perfect drainage, waterworks, etc., and provided with a primary school, a hospital, a post office, a church, a temple, a shrine and some provision stores. Repair shops are also located at Liaoyang. At Suchiatun there is a plant for creosoting railway ties. Angler's Hill on the Antung - Mukden branch Pullman sleeping car, South Man- churia Railway American dining- car on the South Manchuria Railway Machine tools in the Shakakou workshops of the South Manchuria Railway Passenger car shop at the Shakakou workshops SOUTH MANCHURIA RAILWAY AND ITS WORK 77 Railway finance — When the South Manchuria Rail- way Company took over the old Russian properties it had an authorized capital of 200,000,000 yen, half of which was subscribed by the Japanese Government, and the other half by Japanese and Chinese investors. The first stock issue of 20,000,000 yen was over-subscribed 1066 times, an indication of the enthusiasm with which the Japanese embarked on this Manchurian venture. The Japanese Government had invited the Chinese Govern- ment to join in the enterprise, but this offer was not ac- cepted. When the shares were offered to the Japanese public there was no idea that the enterprise would be so profitable, and the great success of the offering was en- tirely due to the patriotic enthusiasm of the people to back the Government in the undertaking. In 1920 the author- ized capital was increased to 440,000,000 yen ($220,000,- 000). In addition to the share capital, the company has floated several issues of debentures in Europe and Japan, and the amount of these outstanding March 31, 1921, was 145,000,000 yen. The largest issues have been sterling loans in the London market, £6,000,000 of 5 per cents, and £6,000,000 of 4^ per cents. The Japanese Government has since taken over these foreign loans. Of the 440,000,- 000 yen share capital, 220,000,000 yen has been allotted for public subscription and an equal amount for Government subscription. Of the public shares, 160,000,000 yen have been subscribed, and 92,000,000 yen of these subscriptions have been called for. Of the Government shares, 100,- 000,000 yen represent the value of the original property turned into the company by the Japanese Government and the balance (120,000,000 yen) represents the amount of London sterling debentures taken by the Government. 78 MANCHURIA: LAND OF OPPORTUNITIES While the actual expenditures on capital account are put down at 474,000,000 yen, the estimated value of all the properties owned by the company, including the coal and iron deposits, is 1,400,000,000 yen ($700,000,000). The general balance sheet on March 31, 1922, was as follows: Assets Yen Liabilities Yen Unpaid Share Capital 70,844,000 Capital subscribed 380,000,000 Expenditure on Capital Ac- Reserve prescribed by Law 7,222,000 count ^74,443,768 Special Reserve 38,400,000 Products in Stock, including Debentures Redemption Coal and other Minerals 10,109,776 Fund 21,000,000 Stores 31,957,222 Debentures 175,000,000 Negotiable Documents, in- cluding Shares in other 721 513 Accounts with other Houses 395,594 Companies and others. 12,857,001 Guarantee Money . 1,198,698 Foreign Coins 10,585 Collateral Securities 1,500 Cash in Hand 220,591 Transfer Account . 50,079 Stamps, Postals & Revenue 23,921 Compulsory Guarantee de- Deposits 40,960,797 posits of the Company's Loans 39,623,962 Employees 11,983,267 Accotmts with other Houses 425,106 Savings deposits of Com- Collateral Securities 3,657 pany's Employees 4,327,303 Sundry Debtors 1,204,460 Mutual Relief Society Re- 155 562 2,819,475 33,120,215 Uncollected Credits 14,458,001 Sundry Creditors Payments on Suspense Ac- Receipts on Suspense Ac- count 16 004 808 count 5,636,662 Expenditure on Engineering Balance brought forward Account 546,278 from last Term 7,187,601 Expenditure on Workshop Balance for the Term . . . . 31,386,138 Account 1,661,031 Discount on Debenture Is- sue, less amount writ- ten ofif 4,939,518 720,450,052 720,450,052 Dividends on the publicly held shares are guaranteed at 6 per cent by the Japanese Government, but the success of the enterprise has enabled the company to increase the dividend gradually to 10 per cent. The government shares in the profits after the pa5mient of all charges and the 6 per cent dividend on the public shares. The gov- ernment is now receiving 4.3 per cent on its holdings. A number of the enterprises of the company are con- ducted at a loss or a nominal profit, because they are of MILLIONS SOUTH MANCHURIA RAILWAY OF YEN Receipts and Expenditures : 1907-1921 \15 V 150 J / 9 / 1 1 125 f / 100 ( 1 r 1 f 1 irti 1 A- ^ ; 75 ^7 1 1 / f tul 1 V w/ . Or V ^ 50 / /s / / ■^ y /^ ■-/ y y^' ^■0-^ — rf- 25 ^ <- > / ^^ 0,.^ ^ ^^' / ,^ ■ --<< / ^^ T-^ • V N eT EA JNl NGi ,>_ p^"* -^ CO 1 1 CO 2 1 l-l H I H 1 « H •St « CO t M 1 rl <-l H ri H H H H H H P» C- <7^ 0- Cv 0^ CT c- C^ (r c- t-( r4 T-i H w i-t W fH rH rH T-( *H 79 8o MANCHURIA: LAND OF OPPORTUNITIES public benefit or develop traffic for the railway. The ex- penditures for local administration in 1921-22, for ex- ample, were more than $5,000,000 and the receipts were less than $2,000,000. The profitable operation of the rail- way itself enables the company to devote capital to the development of the country. The receipts and expendi- tures of the various enterprises is shown in the following account for 1921-22: Expenditures Yen Railways 33,172,716 Steamers 810,556 Harbors 6,911,904 Mining 36,708,108 Iron Manufacture 6,480,725 Electricity 3,483,511 Gas 537,501 Hotels 1,305,092 Local Administration 10,386,002 Interest on Debentures, Loans and Deposits . . 13,267,848 Sundry Losses 465,974 Writing off Discount on Debenture Issue 2,184,621 Receipts Yen Railways 78,204,132 Steamers 555,633 Harbors 7,580,559 Mining 40,004,029 Iron Manufacture 3,606,999 Electricity 4,297,282 Gas 827,421 Hotels 1,085,933 Local Administration 3,954,463 Interest on Invested Funds 3,819,490 Sundry Profits 2,861,439 Profit from Chosen Line.. 303,217 Balance for the Term. 115,714,463 . 31,386,138 147,100,602 147,100,602 The growth in earnings is shown in the following table: Receipts Expenditures Net Profit Yen Yen Yen 1907-8 12,543,116 10,526,531 2,016,585 1908-9 17,615,683 15,.502,101 2,113,582 1909-10 23,113,933 17,342,234 5,771,699 1910-1 1 24,777,684 21,069,368 3,708,316 1911-12 28,155,080 24,487,652 3,667,428 1912-13 33,546,477 28,620,432 4,962,045 1913-14 42,417,123 35,249,844 7,167,279 1914-15 44,670,616 37,129,525 7,541,091 1915-16 43,786,025 35,705,526 8,080,499 1916-17 52,402,408 42,294,801 10,107,607 1917-18 69,429,252 54,503,610 14,925,643 1918-19 96,257,877 74,064,706 22,193,171 1919-20 153,133,387 128,758,422 24,374,964 1920-21 174,738,287 147,346,302 27,391,984 1921-22 147,100,602 115,714,463 31,386,138 SOUTH MANCHURIA RAILWAY AND ITS WORK 8 1 Railway traffic — The number of passengers carried by the South Manchuria Railway has increased about six- fold, and the tons of freight hauled about seven-fold. The freight tonnage passed the 10,000,000 mark in 1919-20. These traffic figures for the past fourteen years are shown here: Tons of Passengers Freight 1907-8 1,512,231 1,486,434 1908-9 1,868,140 2,609,036 1909-10 2.179,062 3,568,527 1910-11 2,349,088 3,922,164 1911-12 3,158,270 4,705,690 1912-13 3,905,822 4,681,698 1913-14 4,143,687 5,782,161 1914-15 3,617,547 5,705,948 1915-16 3,708,165 5,860,716 1916-17 4,410,816 6,229,757 1917-18 5,844,929 7,274,177 1918-19 7,491,496 8,334,084 1919-20 9,274,114 10,096,672 1920-21 8,123,411 10,154,259 A more accurate measure of the remarkable growth in traffic is to be had in the record of passengers carried one mile and tons of freight carried one mile, shown in the following table : Passenger Miles Ton Miles 1907-8 140,753,513 271,730,499 1908-9 136,837,913 513,316,086 1909-10 154,032,778 628,631,101 1910-11 151,234,501 674,492,481 1911-12 209,535,512 737,802,153 1912-13 253,160,775 895,540,914 1913-14 255,909,094 1,113,606,271 1914-15 221,226,921 1,203,445,614 1915-16 255,261,946 1,148,556,115 1916-17 313,717,726 1,305,970,165 1917-18 401,049,336 1,509,283,963 1918-19 511,176,520 1,725,339,506 1919-20 575,496,292 2,066,858,405 1920-21 526,991,710 2,285,536,887 H p (S / C^ 1 — 1 / H / o (N) / (N CfA s. (7 1 N N i-i o s V IT- e. '•^ \ f-i '-^ \ \ C^ o \ N H :£ \ ■^> CO V V iM H A G^ H \ lTX \. byD \ ^ \, t-- y\ ^\ fe -J* ^N H ifi' s c \ \ A \ H u \ 1^ n- 1 rrv i} i 1-1 1 1.! / H ■■ '■k / 1 t < ! G^ 1 1 < ' H c ^) < r^ 1 5^ 1— ( H < V O rt \ E*^ \o" O^ 00^ r^ iTi ---t (VI irT O O^^ -^ Tt" v^T Th \ , ' \ ■z \ c- \ < \ \ H \ \ o K vs ,-(Or-)00Orvjr^i>.iovOO-O'^i-t \ I H *^ rn'^'Ooor^rgoO'^^O'-Hr^Ti-i-H.r-t \ O in \ \ \ \ \ \ \ \ \ IT- o r^00Q\O'-Hr-if^'^io»or^00OvO A CO O'O'O^O'O'O^O^O^O'O'O^O'O'Os K s VI Li L*. — u "' __ — — — a-- -■■tt; "= Z o o / y / i f / / ^ 250 J tJ eE R 0^ ftl 1 w^^ '.^ -_ PA sA>- : <^- — >-- .-0-- '_ 05 O 1 05 o O r-t o r-l o I- H H 3 I 1-1 H r-l t-i r-l H ■s 1 s 1 CO o 1 t o H 84 The plant which supplies Dairen with its illuminating gas Electric light and power plant, Dairen Coal storage for Dairen gas works Railway shops and town, Shakakou E3 s ^ & o E ■» SOUTH MANCHURIA RAILWAY AND ITS WORK 85 Railway rates — Passenger rates at present are: first class, 3;^ cents a mile; second class, 2j4 cents; third class, 1^4 cents. The average revenue per ton-mile in 1920-21 was 1.39 cents, which compares with the present American revenue of 1.25 cents per ton-mile, and the English figure of 3.95 cents. Special reductions in rates are made from time to time to encourage local development and to assist in relief work. During the North China famine in 1920 the com- pany made a 50 per cent reduction in freight rates on sup- plies moving into the famine area. It carried free thou- sands of Chinese famine refugees in 1920 and 1921. Also in 1920 the road carried Roumanian and Polish refugees at half rates. Every spring it carries Chinese coolies at half rates. In the spring of 1922 it made a 50 per cent re- duction on cereals to Mukden destined to relieve the South China famine. Reductions of from 20 to 25 per cent have been made on building materials and living necessities for new communities. This is the same method of local aid that was successfully followed by the pioneer roads in the American West. Through routes for passengers and freight have been established in cooperation with the various rail and water lines to Chinese and Japanese ports and inland cities, and to America and Europe. Before the European War a new short through route was established (1908) from Shanghai to Europe, via South Manchuria Railway steamer to Dairen, and South Manchuria Railway north- ward connecting with the Trans-Siberian. This service will be resumed when normal conditions return in Siberia and Russia. The rebuilding of the line from Mukden to Antung, and the opening of the great bridge across the 86 MANCHURIA: LAND OF OPPORTUNITIES Yalu (1911), thus connecting the Manchviria and Chosen lines, established a new world highway between Japan and Europe. The freight and passenger receipts have grown from less than $5,000,000 a year to more than $40,000,000, and the railway net earnings have reached $26,000,000. The record of earnings is as follows: Net Railway Receipts Expenditures Revenue Yen Yen Yen 1907-8 9,768,887 6,101,615 3,667,272 1908-9 12,537,142 5,161,408 7,375,735 1909-10 15,016,198 5,818,333 9,197,865 1910-11 15,671,605 6,542,640 9,128,965 1911-12 17,526,288 6,908,354 10,617,934 1912-13 19,907,456 7,846,923 12,060,533 1913-14 22,275,132 7,913,948 14,361,184 1914-15 23,216.722 8,345,286 14,871,435 1915-16 23,532,118 8,174,520 15,357,598 1916-17 27,815,349 8,435,939 19,379,409 1917-18 34,457,923 10,858,734 23,599,189 1918-19 44,992,872 17,038,157 27,954,715 1919-20 67,060,720 30,528,938 36,531.782 1920-21 85,316,806 36,760,264 48,556,542 1921-22 78,204,132 33,172,716 45,031,416 Statistics of operation— The report of the South Man- churia Railway for the year ending March 31, 1921, gives the following significant statistics of operation: Miles of line 686 Miles of track 1,454 Train-miles 7,257,336 Locomotive-miles 8,783,120 Car-miles 163,316,416 Passengers carried 8,123,411 Passenger-miles 526,991,710 Passenger train earnings $6,742,435 Passenger train earnings per mile of road $10,754 Average receipts per passenger-mile (cents) 1.28 Average journey per passenger (miles) 64.9 Average passengers per train 293.3 Tons of freight carried 10,154,259 Ton-miles of freight 2,285,536,887 SOUTH MANCHURIA RAILWAY AND ITS WORK 87 Freight earnings $31,933,515 Freight earnings per mile of road $46,537 Average receipts per ton-mile (cents) 1.39 Average haul per ton 225.1 Average tons per train 437.2 Transportation and traffic expenses $7,378,975 Maintenance of equipment expenses $3,075,900 Maintenance of way expenses $2,665,100 General expenses $5,160,766 Total railway expenses $18,280,766 Total railway revenues $39,263,188 Operating ratio 43.1% Total receipts from all sources $42,658,403 Total expenses of all kinds $18,380,133 Net profit from all sources 24,278,270 Equipment : Locomotives 340 Passenger train cars 328 Freight train cars 5,624 Personnel : Employees 37,500 Warehouses — The warehousing business was in a very crude state when the company took over the operation of the railway lines, and the railway company undertook the management of all warehousing facilities. There are today i^ 1 railway warehouses at Dairen and twenty- nine other stations, occupying 668 acres, as well as huge ground storage yards on the Darien water front and along the line of the railway. The warehouses at Dairen num- ber seventy-three. The freight handled at the ware- houses now amounts to about 5,000,000 tons a year, and the number of warehouse receipts exceeds 100,000 a year. In order to attain uniformity in quantity and weight of bean cake, and also to facilitate its custody, the "mixed storage system" was introduced at the Dairen wharves in 1913 and was later extended to Mukden, Tiehling and Kaiyuan stations on the main line. 88 MANCHURIA: LAND OF OPPORTUNITIES The company also inaugurated a plan of insurance, by arrangement with a number of Japanese and foreign in- surance companies, whereby it insures goods at the Dairen wharves while in its custody, without charge to the owners. The Dairen Wharf Office of the South Manchuria Railway looks after the trans-shipment of freight for the benefit of shippers or consignees, putting goods through the Customs Office, obtaining ocean or railway bills of lading, effecting insurance and so forth. This service has proven very useful to those who are not familiar with Far Eastern business practices and have no representative at Dairen. (3) Harbors and Ships Dairen^ the gateway to Manchuria — Within a few miles of the southernmost point of the Liaotung Peninsula on the Yellow Sea there was less than twenty-five years ago a deserted bay, which the Russians planned to make the southern ocean terminal of the Trans-Siberian Rail- way. That bay today is one of the finest harbors of the Far East, and ranks next to Shanghai as the second largest trading port on the continental shores of the Pacific. Dairen, a little while ago a small fishing village on the shore of the bay, has grown into a great modern city of 200,000 people, with boulevards, parks, public buildings, banks, clubs, hotels and business houses planned on the best European models. This wonder city of the Orient is the gateway to Manchuria. On its great docks are an- nually handled 5,000,000 tons of merchandise, the prod- ucts of Manchuria's awakened industry exchanging with merchandise from America and Europe and the neigh- boring countries of the East. This magic transformation has been brought about by the South Manchuria Railway, which has expanded the port and the city as the key to its whole broad plan of Manchurian development. SOUTH MANCHURIA RAILWAY AND ITS WORK 89 The construction of the port of Dairen was originally begun by the Russian Government when it obtained a lease of the Liaotung Peninsula from China in 1898. Rus- sia called the site "Dalny" and started construction, but soon after the Russo-Japanese War broke out and opera- tions were suspended. By the Treaty of Portsmouth, the Russian Leased Territory was turned over to Japan. At Dairen, all that Japan found was a half-completed break- water and one pier. The South Manchuria Railway immediately entered upon a comprehensive plan of harbor development. The breakwater was improved and completed, and the old Russian pier was reconstructed. Two new piers have since been built, and a third is now under construction. The new breakwater is 14,121 feet long, and the area en- closed by it is 800 acres. Any steamer with a draft not exceeding 30 feet can be berthed at the piers. Fourteen powerful tugboats are at the service of ships entering and leaving the harbor. All piers are equipped with water hydrants capable of furnishing 60 tons of water an hour. There are also two water boats which can supply 30 to 50 tons an hour. The total length of the wharves is more than two and a half miles. Steamers totaling 85,000 tons can be docked at the same time. Besides these piers, there is one oil pier measuring 1,135 feet in length, just outside the breakwater, for loading and unloading of oil and combustibles, and one junk wharf for the loading and unloading of junk cargoes, which amount to approximately 200,000 tons a year. For vessels discharging or loading in the bay there are twelve steel lighters. There are also three 25-ton and two 50-ton floating cranes at the disposal of merchant ships. 90 MANCHURIA: LAND OF OPPORTUNITIES On the piers, and within the wharf compounds, the rail- way company has built 73 warehouses with a capacity for housing 400,000 tons of cargo, and an area of 315,000 square yards is left available for open storage. Twenty- one electric and steam cranes have been installed on the piers to handle heavy cargo. In the wharf compounds there are 43 miles of railway tracks to facilitate the shift- ing and handling of merchandise. One thing which has tended to delay the installation of modern conveying and cargo machinery at Dairen is the low cost of Chinese coolie labor. But American con- veying machinery is now being planned for the South Manchuria Railway to be used within the wharf com- pounds. The present cargo working capacity of Dairen is approximately 37,000 tons per ten-hour day. In addition to this, there is a shifting capacity of 20,000 tons within the wharf compounds. With the installation of modern machinery and equipment, and the expansion of the pres- ent facilities, it is planned greatly to increase this capacity. Freight trains are run directly into the wharf compounds and to the piers, to handle through cargo. Passenger trains also run direct to the pier to connect with passenger steamships. Coaling facilities are also maintained, and steaming coal from the Fushun coal mines is sold for bunkering trans-Pacific steamships calling at Dairen. Facilities are available for loading 3,000 tons of coal in ten hours. During 1920 an average of eighteen ships, aggregating 41,000 tons, were in the harbor every day. In the same year, 3,530,000 tons of cargo were loaded, and 831,000 tons unloaded; 2,994 steamships, totaling 5,292,000 tons, entered the port. The record number of steamships in port at one time was thirty, and the largest tonnage of steamships in port at one time was 71,800 tons. SOUTH MANCHURIA RAILWAY AND ITS WORK 9 1 The port of Dairen has not only the best equipped harbor in China, but possesses another distinction in that it has the only dry dock in North China. The Kawasaki dry dock in Dairen is 430 feet in length, 50 feet wide, and 25 feet deep. It can accommodate a 6,000-ton steamer. Other harbors in Manchuria — The harbors of Port Arthur, a short distance below Dairen; Yingkou, at the mouth of the Liao River on the Gulf of Liaotung, and Antung, at the mouth of the Yalu River on the Yellow Sea — also have been improved by dredging and the build- ing of jetties, warehouses and storage yards. But the rise of Dairen as the chief port of Manchuria has over- shadowed these other ports. Dairen has great natural advantages over Yingkou and Antung because the harbor is free of ice throughout the winter and the channel is of much greater depth. Steamships — When the South Manchuria Railway es- tablished the new short route from Europe to China and Japan in 1908, the company also put in service a steamship line connecting the Dairen railway terminal with Shang- hai across the Yellow Sea. Tsingtao on the China coast was made a port of call. The steamer "Sakaki Maru" (3876 tons, 19 knots) was built at Kobe specially for this service. In connection with Hongkong and Canton shipping in- terests, the company opened a coastwise shipping line be- tween Dairen and southern China ports, to obtain freight for the railroad. These steamship lines have since been sold to the Dairen Steamship Company to operate. (4) Coal Mines and Steel Works Coal mines — The coal mines at Fushun, Yentai and Chatzuyao were taken over in 1907 by the South Man- churia Railway with the railway properties. The Shih- 92 MANCHURIA: LAND OF OPPORTUNITIES peling and Taochiatun mines were acquired later in the same year. Of these mines those at Fushun and Yentai have been developed by the railway company. The others have been transferred to private companies to be operated by them. Fushun coal is a bituminous coal, rich in volatile mat- ter, with a heating power of 7500 calories. Ash and clinkers are very scarce, and sulphur and other objection- able matters are almost non-existent. As fuel for loco- motive and marine engines, it competes with the best Japanese coal. Because of the large percentage of vola- tile matter which it contains it is more suited for gas- making than any other coal in the East. It is also suitable for general industrial uses, for brick and lime kilns, smithies, household uses, etc. Fushun coal does not stick to the grate when it burns, so that even an inexperienced fireman can make a fire with it very easily. It catches fire as soon as it is put into the furnace, facilitating an easy cleaning of fire with little loss of steam pressure. As the quantity of sulphur is infinitesimal, the coal has the ad- vantage of doing very little damage to the boiler plates. It gives out little smoke. Fushun has been made one of the model colliery tov/ns of the world. For the operation of the mines the most up- to-date methods have been brought from the United States, including the sand-flushing system. There are 82 miles of railway, with 26 electric, locomotives and several hundred cars. , , ■ , i, ,.; With the development of the mining operations at the collieries, the necessity of providing housing accommoda- tion for the employees was recognized, and the company drafted a plan for building a new town at Chienchinchai as an auxiliary enterprise. The management has con- > 3 2. n 3 Fushun Club at the Fushun Colliery Auditorium for the entertainment of the workers of the Fushun Colliery Billiard room in the Yamato Hotel, Dairen Japanese gardens on the roof of the Yamato Hotel, Dairen Panorama of Dairen and harbor from Yamato Hotel roof Bank of Chosen and other modern buildings on Central Circle, Dairen Roof garden on the Yamato Hotel, Dairen Central Circle. Dairen, from the Yamato Hotel, showing statue of General Viscount Oshima SOUTH MANCHURIA RAILWAY AND ITS WORK 93 structed a large number of model residences, as well as streets, bridges, drains and sewers necessary for maintain- ing a town on modern methods. In addition, a primary school, a colliery hospital, a club, electric and gas works, waterworks, and other public works have been established. At the end of March, 1918, the colliery town contained 5,775 dwellings (3,801 Japanese, 1,666 Chinese, and eight Korean), and the population was 35,980 (10,643 J^P^^^" ese, 25,283 Chinese, and fifty-four Koreans). Anshan Steel Works — A description of the Anshan Steel Works is given in Chap. III. The South Manchuria Railway Company has been making every effort to es- tablish the steel works on a firm foundation. During 1921 the company invited a group of American experts and engineers, headed by Dean Appleby of the University of Minnesota, to go to Manchuria and make a complete investigation of the work already done and make recom- mendations as to the further development of the enter- prise. The program for the Anshan Steel Works will be based upon the recommendations of these American ex- perts, who are so well acquainted with the treatment of iron ores in the United States. (5) Gas and Electricity Gas works — For lighting, heating and industrial use, the company constructed a gas-making plant in Dairen in 1910. The demand has grown so rapidly that the original plant has been repeatedly enlarged, the capacity having been increased from 280,000 to 1,1 10,000 cubic feet a day. The output in 1920 was 214,000,000 cubic feet, in the mak- ing of which 18,500 tons of Fushun coal were consumed. The by-products consisted of 12,000 tons of coke and 220,- 000 gallons of tar. In 1920 a large gas tank was erected 94 MANCHURIA: LAND OF OPPORTUNITIES at Anshan. The gas system at Fushun markets its sur- plus in the city. Electric works — The company maintains electric works at Dairen, Mukden, Changchun and Antung for light, heat and power. The Fushun plant is operated by the colliery. These plants are all equipped with the most modern machinery, and there has been a steady increase in the output of current. Electric railways are operated at Dairen and Fushun. The Dairen system includes subur- ban lines to Shakakou, where the big railway shops are located, and two seaside resorts, Hoshigaura (Star Beach) and Rokotan. (6) Hotels A modern hotel system — In order that European and American travelers in Manchuria might have "all the comforts of home," the South Manchuria Railway plan- ned a system of modern hotels from Dairen to Chang- chun, which have been built and operated without thought of profit. In addition to building these new hotels, the company has given financial aid to other hotel owners to encourage the operation of high-class establishments along the line of the railway. The Yamato Hotels — The South Manchuria Railway hotels in the cities of Dairen, Port Arthur, Mukden and Changchun, and at Hoshigaura (Star Beach) are known as the Yamato Hotels. The chief of these is the famous Dairen Yamato Hotel, a fireproof structure in modern Renaissance style, with all the conveniences the experienced traveler is accustomed to in the best foreign hotels. It faces the central plaza of the modern city of Dairen, and the Japanese roof garden overlooks the busy harbor. SOUTH MANCHURIA RAILWAY AND ITS WORK 95 Five miles southwest of Dairen at beautiful Hoshigaura on the sea, have been built a summer hotel and a number of bungalows and villas in European and Japanese style which are let furnished. Here tennis, golf, boating and other sports attract the visitor. The golf course has been laid out over the hills back of the hotel. (7) Scientific Research Institutions Putting science at work in Manchuria — For the pur- pose of giving Manchurian industry the benefit of the v.'orld's scientific knowledge, and at the same time pro- moting independent research in applied science, the South Manchuria Railway has organized three major research institutions: the Central Laboratory at Dairen, the Geo- logical Institute at Dairen, and the Agricultural Experi- ment Station at Kungchuling, with branches at other points. These institutions have brought to Manchuria the results of scientific research in Europe and America, and have been of inestimable value in developing the re- sources of the country. In these institutions young men educated in foreign universities and technical schools are encouraged to make new discoveries, invent new processes, find new uses for materials, and teach the native tillers of the soil how to "make two blades of grass grow where one (or none) grew before." The Dairen Central Laboratory — The Central Labora- tory, originally established by the Kwantung Government in 1908, was taken over by the railway two years later. The work was reorganized into eight divisions : analytical chemistry, applied chemistry, tussah filature and dyeing and weaving, pottery, brewing, sanitation, electrical chem- istry and general. It was provided that for any enterprise promising to be commercially profitable an experimental factory might be 96 MANCHURIA: LAND OF OPPORTUNITIES set Up, and that when any experimental factory reached the commercial production stage it should be turned over to a business company to operate. A tussah filature was es- tablished in 1910, followed by an earthenware and porce- lain factory, and a fire brick kiln. Later a sorghum alco- hol distillery, a dyeing and weaving works, a bean mill employing chemical extraction, and a fatty acid factory were organized. Still later there was added a glass factory and a lignoid factory. The experimental bean mill, with its fatty acid factory, was transferred to private management in 1915, upon the completion of the series of experiments for which it had been established. The textile and dyeing works was reor- ganized into a textile division in 1917, the works having been transferred to private management. The lignoid fac- tory, having finished the experiments originally planned, was also transferred to private management. In 1920 the pottery industry division was detached and was formed into a Ceramic Experimental Institute. The other divis- ions were incorporated into the two new divisions of ex- amination and research. The distillery and the filature were both shut down, as they had finished the experiments laid out for them. Among the industries built upon the results of investigations by the laboratory may be enumer- ated the manufacture of hardened oil, salvarsan, calcium lactate, potassium salts, starch, improved koji for sorghum alcohol, rice, yeast, and permutite filter. Geological Bureau — The Geological Bureau was first established at Fushun to help develop the Fushun Coal Mines. Later the office was removed to Dairen and de- voted to geological work and a survey of the mineral re- sources of Manchuria. The conspicuous achievements of the bureau have been the discovery of the iron deposits of Anshan and seven other localities, the discovery of mag- SOUTH MANCHURIA RAILWAY AND ITS WORK 97 nesite in the Kaiping and Haichung districts, the dis- covery of fluorspar, and surveys of the coal fields. Agricultural Experiment Stations — The Agricultural Experiment Stations and farms occupy 750 acres. The main station was established in 1913 at Kungchuling, and a branch at Hsiungyocheng in 1914. Nurseries were later started at various points along the railway line. A descrip- tion of the important work done by these stations is given in Chap. II, in the sections on agriculture and forestry. Farm improvement work — The railway, in connection with the Agricultural Experiment Stations and other de- partments, encourages the native farmers in various ways. It distributes fertilizers and shows how to use them; reclaims land, builds drains and ditches, digs wells and supplies water free of charge, distributes seeds, protects domestic animals from disease, introduces blooded stock, gives financial assistance, and carries fertilizers and other necessities at reduced freight rates. Eastern Asia Economic Research Bureau — This bureau was established in 1908 in Tokyo for general economic re- search work and the study of international business and financial conditions. The work is modelled after that done in Europe and America by banking and industrial cor- porations and in this work are engaged a number of Japan- ese and foreign experts. This bureau has published more than two hundred reports. Other research work — Other bureaus established by the South Manchuria Railway are making researches into Manchurian and Korean history and Manchurian and Si- berian customs. The former work is under the direction of Dr. Shiratori, the authority on Oriental history in the Japanese Imperial University. The study of ancient cus- 98 MANCHURIA: LAND OF OPPORTUNITIES toms has resulted in the publication of a number of mono- graphs. (8) Civic Administration The development of the railway area — By the Ports- mouth Treaty, signed at the close of the Japanese-Russian War, a part of Manchuria passed under Japanese adminis- tration. That portion of the South Manchuria Railway south of Changchun, and the territory which had been leased by China to Russia, were transferred to Japan. The Japanese set up the Kwangtung Government for the ad- ministration of the Leased Territory, and the policing of the South Manchuria Railway Zone. For the economic development of the Kwangtung Peninsula, the Japanese Government depends largely upon the policies worked out by the South Manchuria Railway Company. The Leased Territory has an area, including islands, of a little over i ,300 square miles, or about as large as a good- sized county in the eastern United States. About 225,000 acres of this land are under cultivation. The population of the Leased Territory, according to the census taken in 1921, was 665,619. This population comprised 587,320 Chinese, 77,490 Japanese and 809 of other nationalities. For local government purposes the Leased Territory is divided into three civil administration districts. The rail- way company assumes the obligation of providing the zone with the necessary schools, hospitals, waterworks, roads, streets and sewers. The great increase in population has been due to Chinese immigration resulting from the development of the re- sources of the country by the Japanese. The increase in population in the railway zone during SOUTH MANCHURIA RAILWAY AND ITS WORK 99 the recent years has been as follows : Chinese Japanese 1908 12,375 17,142 1912 33,435 30,436 1916 59,985 40,158 1920 103,043 71,643 For all Manchuria the following are approximate fig- ures of the growth in population: Chinese Japanese 1912 20,252,300 81,761 1916 24,993,000 97,066 1920 27,120,900 167,889 Land and buildings — The Railway Zone, a narrow strip of land along the right of way, has a total area of 64,000 acres. There were 5,000 buildings occupying 180 acres within the Railway Zone in 1907. The buildings now number 12,500. This includes all the official build- ings of the company, commercial buildings and all other buildings controlled by the company. The total land holdings of the company are 614,000 acres. The company does not monopolize the land or build- ings, but leases them to individual residents for the pur- pose of developing Manchuria. In the cities a permit is refused for any building that tends to create congestion and unsanitary conditions. The building up of cities and their proper management is an important item of the company's improvement work. Seven hundred miles of the railway line afford many lo- cations adapted for city building, especially where the company's stations are located. At the time when the company started its work there were no modern cities along its lines, except Port Arthur, Liaoyang and Kung- chuling. All the rest were simply groups of buildings, in the Russian style, scattered at wide intervals. The roads lOO MANCHURIA: LAND OF OPPORTUNITIES were not properly constructed, nor kept in repair, and were without drainage. In dry weather the dust covered everything in sight, and during the rains the roads became impassable. The railway company early decided to build modern cities at important points. Fifteen locations were selected, and modern plans drawn. The new cities from Dairen northward are the result of this plan. Railway zone policing—In. the interior of China, peace and order are maintained by the army and the police. But the northern provinces are infested with armed bandits. The railway zone itself has been often attacked since 1907. The Kwantung Government, therefore, maintains a suffi- cient police force and railway guard to protect the narrow strip of railway, make safe the running of its trains, prevent the destruction of railway property and the cutting of telephone and telegraph wires, and also protect the residents and their properties within the zone. Hospitals, sanitation and hygiene — When the South Manchuria Railway Company was organized there was a central military hospital in Dairen, and branch hospitals and medical stations in nine other cities in Manchuria. These were taken over by the railway, extended, popular- ized and modernized. After the acquisition of the hospitals, special efforts were made to expedite the completion of the entire system, with the result that there are fifteen hospitals today, situated at Dairen, Liaoyang, Mukden, Tiehling, Kaiyuan, Kung- chuling, Changchun, Penhsihu, Antung, Yingkou, Fushun, Wafangtien, Anshan, Ssupingkai and Kirin. In addition there are six branch hospitals, some situated in the old Chinese towns, and two medical consultation sta- tions at the Fushun and Yentai Collieries. The Hospital at Dairen has been made a model institu- f™T In the Central Laboratory, Dairen Dissection room in the Mukden Medical College, founded by the South Manchuria Railway Experimental laboratory in the hospital at Mukden Ceramic Experimental Institule, Dairen Young Men's Christian Association, Dairen The relief crew at the Fusliun Colliery, ready to go clown into the pits in case of emergency Homes o£ skilled laborers at the Fushun mines Elementary sc hool at Fushun for the children o£ employees and others Primary school at Antimg for Japanese and Chinese children The Public Library, Dairen Lecture hall in the Medical College, Mukden ■y-^^^^^^^^^^^^^^i(^^^^^^^§^^ A skating recess at the Changchun Primary School for Japanese SOUTH MANCHURIA RAILWAY AND ITS WORK lOI tion, comprising nine scientific departments. Beside the 450 regular patients which this hospital can take care of, there is a clinic for outside patients with an average daily attendance of more than 800 people. Beside this, there is a medical college, established in 191 1 at Mukden, where doctors for these hospitals and medical stations are trained. The Japanese Red Cross also maintains thirteen hospi- tals throughout Manchuria and Mongolia and some of these are situated where they may benefit most the poorer and more illiterate class of Chinese; and in Dairen and Port Arthur there are special hospitals for contagious dis- eases and for women patients. In most of these institutions a scientific course in nursing is given and in some a school of pharmacy is also con- ducted for the benefit of those seeking such knowledge. These hospitals are open to everybody in Manchuria and thousands of people who never before were reached by science flock to their doors. In addition to the two hospitals, the company maintains public physicians, who, while practising on their own ac- count, have been appointed by the company to guard against the outbreak and spread of infectious diseases, to make investigations of epidemics, etc., in the interest of public health and to spread, as much as they can, the knowledge of hygiene and sanitation throughout the dis- tricts where so many of the natives have never before realized the necessity for even cleanliness. Such compe- tent medical men are scattered throughout the Leased Territory, in the big cities, in the old Chinese towns, and outside of the railway area they administer medical relief. Nothing is being left undone toward safeguarding pub- lic health in the Kwantung Peninsula. The public health department has charge of the yearly vaccination of the I02 MANCHURIA: LAND OF OPPORTUNITIES inhabitants, which is given without cost. The record in health, resulting from vaccination, is improving every year. Epidemic diseases have been a difficult problem. Working together to hold epidemics and plagues in check, the Chinese and Kv/antung Governments, the hospitals, medical stations and doctors under the control of the rail- way, and the Quarantine Bureau, have all worked in the utmost harmony to check such epidemics and to protect the people of Manchuria from their ravages. The Quar- antine Bureau has been particularly effective in its work in the ports and along the waterfront, transferring any infected people to hospitals or keeping them in quaran- tine. All of these organizations are endeavoring to wage a warfare on the Manchurian flies, and thus to extermi- nate that method of disease communication. The Kwantung Government also inspects drinking water throughout the district. The South Manchuria Railway Company, through its inspectors from the Cen- tral Laboratory at Dairen, inspects the water along the railroad line once a month, and all well water throughout the Railway Zone is examined twice a year. It also in- spects all meat. All the schools have assigned to them school physicians, and there are visiting oculists, dentists and nose and throat specialists who also guard the health of the school children of Manchuria. This system of inspection, advice and treatment is carried into the railway works, factories and mines. Education — In 1907 there were but two elementary schools, one for Japanese children at Liaoyang under the Y. M. C. A. and one for Chinese children at Clienkingsai established by the Buddhist Mission. Today the South SOUTH MANCHURIA RAILWAY AND ITS WORK 103 Manchuria Railway Company maintains twenty-five ele- mentary schools for Japanese and thirteen for Chinese children; eleven girls' schools for practical courses; one girls' high school; three commercial schools each for Jap- anese and Chinese boys; two high schools; an industrial college ; a school of elementary mining ; a medical college ; and twenty kindergartens and play-grounds. In addition to these schools there are two libraries and nineteen branch libraries and other educational institutions. There is no discrimination shown in these schools be- tween the Chinese and Japanese scholars, although divi- sions of schools and classes are frequently necessary, owing to the difference in language. Elementary education, to reach all classes and spread its civilizing power over a country, must be compulsory. But to force such education on the Chinese, steeped in cen- turies of their own traditions, was not an easy problem. The South Manchuria Railway Company has followed a policy of making education so attractive that people would practically beg for it. There is an average of one elementary school for the Japanese children in every thirty miles of the company's main line, and one in every forty miles of the Mukden-Antung Line. The company pro- vides passes on the railroad for the school children and regulates the time schedule in order that trains may stop at places where there are schools outside of regular station areas. By these special arrangements and by the estab- lishment of dormitories in dififerent schools, there are hardly any children who cannot attend school. Among the twenty-five elementary schools, twenty have already added the grammar grades. There are now in these schools 94,000 children and 263 teachers. Elementary schools for the Chinese children maintained by the rail- 104 MANCHURIA: LAND OF OPPORTUNITIES road company are divided into three groups: those located in the thickly populated districts in the railway zone or just outside of it; those in the important cities along the railroad, where advanced classes are carried on and board- ing house arrangements are available; and those schools where the Chinese language is taught to the Japanese. This study of the Chinese language is encouraged and Chi- nese is taught not only in elementary schools, but in all of the vocational schools. The high schools are crowded with earnest students. The Mukden high school, first established in 1919, is growing in popularity among the young residents of the old Manchurian capital. It admits graduates of the Chi- nese grammar schools and has preparatory courses for the South Manchuria Medical College. Two commercial schools, one at Changchun and the other at Yingkou, are educating both Japanese and Chi- nese pupils in business principles. Connected with these schools is the Fushun Elementary Mining School. In all of these schools, from primary to college, physical de- velopment and sports of all kinds are encouraged. As soon as the educational institutions for Chinese chil- dren were established in 1911, the railway company sent three teachers to Peking and Mukden for a period of two years, to make them more familiar with the customs and manners of the Chinese. Since that time two teachers are sent every year to Peking. In 1913 the teachers' training school was established; its name was changed in 1915 to the Educational Research Institution. The South Manchuria Medical College in Mukden has a two-fold mission in Manchuria — first, to supplement the general plan for bringing sanitation and health into Man- churia and Mongolia, and, second, to afford both Chinese SOUTH MANCHURIA RAILWAY AND ITS WORK I05 and Japanese youth the opportunities of a modern educa- tion in medicine and surgery. At first no tuition was charged, but now a nominal fee is charged the Japanese students, and many scholarships are awarded each year so that all ambitious youths may have an opportunity to take the course. All students are required to live in the college dormitories. The college has now enrolled 66 Chinese and loi Japanese students. The railway com- pany has already spent over $750,000 on this institution. The Chinese Provincial Governor of Manchuria is hon- orary president of the school. Religious education is carried on in a great measure by many of the Christian denominations who have taken an active interest in the school program of the railway com- pany. Sunday schools and kindergartens are numerous. Japanese Christian institutions in Manchuria and the neighboring districts are increasing in number. Playgrounds and play-buildings have been established. There are now twenty playgrounds with a registration of more than one thousand children and more than fifty nurses. Besides these, there are six private institutions to which the railway company is giving financial aid. The railway company has established public libraries at Dairen and Mukden. Branch libraries are found in all the important cities. These branch libraries not only have their permanent collections, but receive circulating libraries. In addition there are 210 receiving stations where people at a distance from the libraries receive cases of books. All passenger trains of the South Manchuria Railway Company are provided with small libraries. VI. THE OPEN ROAD IN MANCHURIA Manchuria, long the Forbidden Provinces of China, is now open to the traveler. Beauties of scenery, as won- derful as anywhere in Asia, lure the European and Amer- ican to this far country. Not only is Manchuria the scene of amazing developments, new cities, modern industries, scientific achievements and vast agricultural areas, but there is in this old Land of the Manchus a wealth of unfor- gettable beauty. The cities have a two-fold charm. Ad- joining the principal age-old Chinese towns there have arisen modern cities, thus providing the traveler not only with the delights of ancient Oriental life and scenes but making it possible to live while there as he would live at home. Dairen, on the Yellow Sea, the wonderful new city of Manchuria, has been described in earlier chapters. Changchun, at the northern terminus of the railway, has been called the melting pot of Man- churia, and through its streets still drive the old Russian droshkies, mingling with the spike-wheeled Peking carts, the dainty 'rickshas of Japan and the latest models of Western motor cars. Mukden, about midway between Dairen and Changchun, is the greatest point of historical interest in Manchuria. This is the old capital of China. Within the massive walls of the ancient city the natives live today as they have lived for hundreds of years. The teeming streets give a vista of shops, gateways, Chinese theatres, drum towers, temples and palaces. Beyond the walls, in the sur- rounding forests, stand the historic and magnificent tombs of the Manchu Emperors. Numerous other cities, each with its special claim to the traveler's interest, are reached by the South Manchuria Railway. Manchuria 1 06 THE OPEN ROAD IN MANCHURIA 107 is not all cities, nor all prairies, nor all soya bean fields. Mountains with foaming rivers, ancient temples and fairy-like groves form a background for historic hot springs famous for their curative waters. Along the Yellow Sea charming seaside resorts, unrivalled in the Orient, are known to all Western residents in the Orient and are now beckoning to the tourist passing through the East. Hoshigaura, or Star Beach, is a seaside resort twenty minutes by motor from Dairen. A modern summer hotel and picturesque bunga- lows attract many visitors who enjoy the excellent bathing, tennis and golf of this charming spot. Ogondai (Port Arthur) is a beautiful beach resort, with pine- clad hills, an historic battlefield, cozy bungalows and a comfortable hotel. An old fishing village adds interest, and little tea houses perched on the cliffs enchant the eye. The Hot Springs at Hsiungyocheng are of great medicinal value. Excellent hotel accommodations are offered to the traveler who takes the cure at this beautiful resort. At Chienshan, or "The Thousand Ridges", among the beautiful peaks of the mountain range south of Mukden, cluster Buddhist and Taoist temples where the traveler may find hospitality and enchant- ment while visiting at the Hot Springs. The green ridges of Chien- shan are broken with cataracts and traced with alluring roads over which the sedan chairs of tourists are borne swiftly by coolies. A day or a night spent at any of these temples is a page out of China's mystic and gorgeous history. The historic springs of Tangkangtzu, near Anshan, close to the Chienshan mountains, are healing hot springs of great curative value. Known in ancient times, the waters, have been greatly de- veloped, and a beautiful Japanese style hotel with American improve- ments welcomes the visitor. Wu-lung-pei, called the beautiful spa, is in a mountain valley near Antung. These historic springs have been modernly developed, and scientifically tested and found excellent for cases of rheumatism. A modern and comfortable hotel is part of the attraction. Manchuria, with its modern railway system, is now easy of access from Japan and other parts of China. World travelers now include it in their Oriental tours. In going from Japan to China proper, a visit to Manchuria necessitates but a short and very worth-while detour, and in making this detour an adequate view of Chosen (Korea) is afforded the traveler. From the old Manchu capital, Mukden, south to Tientsin, Peking, Io8 MANCHURIA: LAND OF OPPORTUNITIES Nanking, and other cities, the Peking-Mukden Line, and the Peking-Pukow Line (Chinese Government Railways) ofifer excellent transportation. From Peking, the Peking- Hankow Line and the Shanghai-Nanking Line connect with Hankow and Shanghai, and the Peking-Suiynan Line runs to Suiynan and the world-famous great wall. From Dairen, there are delightful sea-trips to Shanghai, Tsingtao, and Hong Kong. From Changchun, the Chinese Eastern Railway (which forms a part of the Trans-Siberian Route) takes the traveler north to such points as Harbin, and from there either to Vladivostok on the east, or to Manchouli on the west. The Chosen Railway which takes the traveler from Antung, Manchuria, through Chosen, straight through to Fusan on the Korean Straits, is under the direction of the South Manchuria Railway Company. From Fusan a ferry-steamer brings the tourist to Shimonoseki in Japan, and from there, via the Japanese Government Railways, one may reach any part of Japan — Nagasaki on the south, (where a steamship line connects with Shanghai and Hong Kong) ; or northward to Tokio and Yokohama — the great Japanese port of the trans-Pacific lines. Lama Tower, Liaoyang, over a thousand years old The Pei-ling tombs at Mukden Chinese Temple in the Chienshan Mountains o[ Manchuria Verandah restaurant, Hoshieaura A honeymoon cottage in true Japanese style at Hoshigaura 'Driving off" on the golf links at Hoshigaura (Star Beach) near Dairen Entrance to the great northern Mausoleum of tlie Manchu Emperors INDEX Administration: Civic 98-105 Government 7-9 Railway ■ 9-11 Afforestation 28 Agriculture 11, 13-27 (see specified products). Area under cultivation 14 Crops 16 Experiment stations 15-16, 95, 97 American equipment and ma- chinery 38, 49, 60, 69, 71, 75, 76, 90, 92 American railroads compared with South Manchuria Railway .... 83 American shipping 52 American trade 60-61 Anshan Steel Works 33, 43, 93 Antung-Mukden Line 75, 85 Appleby, Dean 93 Apples 15, 24 Arboriculture 15 Area of Manchuria 1, 11 Asbestos 37 Baldwin locomotives 49 Banking 64 Bank of Chosen 13, 64 Barley 16, 21 Beans, soya : Bean mills 19, 40 Bean oil, chemical extrac- tion of 40 Beans, soya (continued) Bean cake 40 Culture 16-19 Exports 17, 5S-S9 Mixed storage 87 Beer 43 Beets 42 Bituminous coal 92 (See Coal). Boat building 47 Brewing 43 Bricks 45 Bristles 26, 59 British American Tobacco Co. ... 23 British trade with Manchuria 52 Buckwheat 22 Buddhist missions 102 Bunker coal 90 Calcium carbide 45 Calcium cyanide 45 Calcium lactate 47 Camels 24 Capital, foreign 3g Capital, railway 72-73, 77-80 Car shops 76 Cattle 25-26 Cement 45 Ceramic Experimental Institute.. 96 Changchun 106 Chang Tso Lin, Governor General 8 Chemical industry 44 Chienshan, the Thousand Peaks.. 107 109 no INDEX China Electric Industry Co 4S Chinese banks 65 Chinese Eastern Railway 14, 40. 61, 70, 83, 108 Chinese governmental offices 7 Chinese Government Railways 61, 108 Chinese railroads compared with South Manchuria Railway S3 Chinese trade with Manchuria 52-57 Chosen (Korea) 107 Chosen State Railways 70, 108 Civic administration .98-105 Clay 45 Climate 1 Coal 33-36, 55, 71, 90-93 Coal tar 45, 93 Coke 45, 93 Colleges 102-105 College, medical 104 Commerce, foreign 49-64 Commercial museums 67 "Commercial Handbook of China" 11, 62 Commodities carried by railway. . 83 Communications 12 (see Waterways, Railways, Telephones, Telegraphs, Postal service). Coolies, migrations of 3 Corn 16, 21 Cotton crop 23 Cotton imports 57-58 Crops ; (see Agriculture and speci- fied crops). Currency 65 Custom offices 9, 88 Dairen: Central Laboratory 95 Development of port 88-91 Imports and exports 52-55 Dairen Fat and Industrial Oil Co. 47 Dairen Starch Co 46 Dalny 89 Debentures, railway 77 Distilling 43 Dividends, railway 78 Dockyards 47 Dogs 25 Dolomite Cement Co 45 Donkeys 24 Dry dock at Dairen 91 Dyestuffs 48 Dyeing 47 Earnings, railway 80, 86 East Asia Electric Industry Co. . 45 East Asia Tobacco Co 23 "Economic History of Man- churia" 13, 66, 69 Economic Research Bureau 97 Education 102-105 Electric works 71, 94 Electric railways 94 Electro-Metallurgical Co 45 "Encyclopedia Americana" 13 Epidemics; (see Hospitals). Equipment, railway 72, 76 Exchanges, stock and commodity 66 Expenditures, railway capital.... 73 Experiment stations 97 Exports : Dairen 50-55 Manchuria 57-61 Factories 39 "Far Eastern Review" 60 Feldspar 37 Fertilizers 41, 47 Flour milling 41-42 Finance, railway 72, 77-80 Firebrick 46 Fisheries 29 Fluorspar 37 Foreign trade 50-64 Forestry 27-29 Freight, railway, traffic 81 French trade with Manchuria .... 52 Fusan 108 Fushum colliery 33-36, 71, 91-93 "Garden of China" 13 Gas works 93 Gelatine 47 Genghis-Khan 4 Geography of Manchuria 1 Geological Bureau 96 German trade with Manchuria ... 52 Glassware 46 Glycerine 47 Goats 24 INDEX III Gold 32 Government of Manchuria 7 Grapes 24 Gunpowder 48 Hankow Railway Line 108 Harbors 88-91 Hemp 22, 47 History of Manchuria 3-7 Hogs 15 Hongkong & Shanghai Banking Corporation 65 Horses 25 Hoshigaura ( Star Beach) 107 Hot springs 107 Hotels 71, 94 Hsiungyocheng (Hot Springs).. 107 Hygiene: (see Hospitals). Illinois, Manchuria compared with 13 Immigration 3, 14, 98 Imports 52-61 Industries; (see under specified). Insurance 64 International Banking Corporation 65 Investments, railway 10, 70-73 Iron manufacture 33, 43, 93 Iron mining 33 Japanese banks 65 .fapanese jurisdiction 8 Japanese Red Cross 101 Japanese trade with Manchuria.. 52 Japanese investment in railway 73, 77-78 Jute 22, 47 Kaoliang 16, 19, 47 Kawasaki Dockyard Co 47 Kindergartens 103 Korea (Chosen) 107 Koreans in Mongolia 3 Kungchuling 11, 15 Kwantung Province : Factories 39 Government 8-9 Leased Territory 5, 8, 98 Public health 101 Railway policing 100 Laboratory, Dairen Central 95 Lactate acid 47 Land and buildings 99 Leased Territory 8, 98 Leather 48 Libraries 105 Lignoid 96 Limestone 45 Locomotive slinps 76 Lumber 46 Magnesite 37 Maize 21 Manchu Dynasty 4, 30, 33, 49 Manchuria Barium Industry Co. 45 Manchuria Blasting Powder Co. 45 Manchuria Flour Mill Co 42 Manchuria Hemp Manufacturing Co 47 Manchuria-Mongolia Fibre In- dustry Co 47 Manchuria-Mongolia Shokusan Co. 48 Manchuria Paint Co 45 Manchuria Starch Co 46 Manufacturing 38-48 Matches 48 Medicines 47 Mica 37 Ivlileage of railways 61 Millet 16, 20 Milling, flour 41 Mining 12, 30-37 (see under specified minerals). Mitsui & Co., first exporters of soya beans 16 "Modern manna" 16 Mongolia, Inner 2, 7, 37 Mountains 2, 107 Mukden 4, 11-12, 106, 108 Battle of Mukden 5 Mukden- Antung Line 75, 85 Mukden Chemical Co 45 Mules 25 Museums, commercial 67 Nagasaki 108 Newchwang, opening of port 49 Nitre 37 Oats 24 I 12 INDEX Ogondai 107 Oil mills 40 (see Beans, Soya). Onoda Cement Co 45 Operating statistics, railway 86 Orchards 15 Passenger, railway, traffic 81 Pearls 30 Peking, railways to 108 Penhsihu steel works 44 Permutite filter 96 Pigs 24 Pittsburgh rails 47 Playgrounds 105 Policing, railway zone 100 Population 2, 11, 98 Port Arthur, siege of 5 Ports, the four chief 50 Portsmouth, Treaty of 5, SO, 68, 89, 98 Postal service 63 Potassium salts 47 Potatoes 24 Pottery 46 Produce exchanges 66 Provinces, Three Eastern 1 Pulp, paper-making 47 Railways in Manchuria 61, 108 Railway shops 47 Railway rates 85 Railway traffic 81 Railway Zone : Administration 9 Development 98 Factories 39 Hospitals 100 Land and buildings 99 Policing 100 Rainfall 2 Rates, railway 85 Red Cross, Japanese 101 Reforestation 15 Research bureaus 71, 95 Rice 22, 47 Rivers 2, 62, 91 Russian railway building. . .50, 73, 88 Russian railway concession 5 Russians in Mongolia 3 Russians in Siberia 4 Russo-Japanese War 5, 21, 50, 55, 75 Salt 36 Seals 29 Salvarsan 96 Sanitation (see Hospitals). Saw mills 46 Schools 102-105 Scientific research institutions 15, 38, 95-98, 102 Shakakou railway shops 76 Shanghai 91, 108 Shanghai-Nanking Line 108 Shantung, immigration from 3 Shantung silk 43 Sheep 26 Shimonoseki 108 Shipping at Dairen 50-55, 88 Shiratori, Dr 97 Shops, railway 76 Silica 37 Silk 16, 23, 43 Soap 47 Soda, natural 37 Solite Manufacturing Co 45 South Manchuria Electricity Co. 45 South Manchuria Railway: (see under various subjects). South Manchuria Sugar Refining Co 24 Soya beans: (see Beans). Starch 46 Steamship services 62, 91, 108 Stearine 47 Steel making 33, 43, 93 Stock breeding IS, 26 Stock, railway 77-78 Sugar, beet 24, 42 Sulphur 37 Sulphuric acid 45 Suzuki & Co 41 Taels, value of 54 Talc 37 Tankangtza (Hot Springs) 107 Tanning 47 Tar 93 Telegraphs 63 Telephones 63 Tientsin, Treaty of 49 Timber 27-29 INDEX 113 Tobacco 23, 47 Tonnage, railway 81-83 Tonnage, shipping 50-55 Topography 2, 11 Trade, foreign 50-64 Trade organizations 66 Traffic, railway 81-84 Trans-Siberian route 76, 85, 108 Treaty, Chinese-Japanese 6 Treaty of Portsmouth 5, 50, 68, 89, 98 Treaty of Shimonoseki 5 Treaty of Tientsin 49 Treaty ports 12 Tiissah 16, 23, 43 "Twentieth Century Limited of the Far East" 76 U. S. Consul General at Mukden, trade report by 58 U. S. Department of Agriculture report on soya beans 16-17 U. S. Department of Commerce report on Manchuria 11 University of ]\linnesota 93 Vladivostok 5, 108 Wages 72 Warehouses 64, 87 Waterways 62 Whale fishing 29 Wharves, Dairen 87 Wheat 16, 21 Wickerwork 48 Wine production, possibilities for 24 Wool 26, 48 Wu-Lung-Pei (Hot Springs) .... 107 Yalu Lumber Co 46 Yalu Sawmill Co 46 Yamato Hotels 94 Yokohama 108 Yokohama Specie Bank 64 Young Men's Christian Association 102 ■::|:i;;;;:;M ii;!;i!i:;;'i»fl