This paper discusses the cycle of diffusion and convergence of Cantonese capital, one of the biggest transnational capitals in East Asia in the 20th century and focuses on the trend of its returning to China and greater China during the wartime.
At first, Cantonese merchants following the shift of Western trading companies in large numbers migrated from their hometowns-Canton and Pearl River Delta-to Shanghai, a new open port which developed into the biggest metropolitan in East Asian by the end of 19th century and substituted the place of Canton as a leading trade port in China in a short span of time. Shanghai became not only the distribution center for British products in East Asia, but also the center of East Asia interregional trade. The opening of Japan forced by Western powers and the opening of Korea following Japan’s fate gave new chances to Cantonese merchants in Shanghai. Even though Japan and Korea witnessed the same phenomenon that Cantonese merchants occupied the considerable share among early Chinese immigrants, the motivation and the characteristics of the immigrants were different in each region.
Western companies took Cantonese compradors to Japan and Cantonese merchants found their own business chances with the expansion of foreign trade in Japan. Mostly, they managed the import trade from China to Japan. On the contrary, Korea saw Cantonese merchants at first in Incheon with the advent of political and military intervention of Qing Empire in 1882. The presence of Qing power in Choseon provided for Chinese business in Korea and boosted a lot the immigration of Cantonese merchants. Accordingly, after the defeat of the Sino-Japanese War in 1894-95, weakened political background made the Cantonese capital lose the economic interest in Choseon, Korea. In spite of that, still many Cantonese merchants kept their business in Korea, because the Sino-Korean trade itself continued to developed and increased by over 10 times until the forced annexation of Korea by Japan in 1910.
The Real blow on their business came with the tide of protectionism and nationalism in the 1920s. The Japanese home government and the Japanese Government General in Korea respectively adopted to raise the import tax on the silk and linen from China. Especially Korean media agitated nationalistic anti-Chinese sentiments stimulated by the Chinese oppression on Korean immigrants in Manchuria. Relatively high economic status of Korean-Chinese also caused the jealousy among Korean people. The decisive blow was the Wanbaoshan incident and the Mukden incident in 1931. Moreover, the full-scale war between Japan and China broke out in 1937, and Chinese in Japanese territory became the citizen of hostile country, and suspected as potential enemy highly possible to communicate secretly with mainland China. Political enmity drove Cantonese merchants to withdraw from Japan and Korea.
However, Cantonese merchants had multiple choices for new settlement. It could be Canton, Shanghai, Hong Kong, Singapore or other Southeast Asia. Multiple alternatives and interregional networks were their great advantages for immigrating capital, compared with Shandong merchants and laborers who maintained majority in the overseas Chinese population in Korea and whose number still kept increasing in Korea during the wartime. At first, most of Cantonese merchants in Japan and Korea returned to Canton or Shanghai as the wartime conditions got worse. However, Cantonese merchants in the mainland increasingly found Hong Kong attractive for a shelter to avoid the impact of war and political struggles. The civil war and the final triumph of Communist Party in the mainland China intensified the trend of capital shift from Shanghai to Hong Kong.