The Influence of British Business Interests on Anglo-Japanese Relations, 1933- 1937
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The influence of British business interests on Anglo-Japanese relations, 1933- 1937 . John Sharkey A thesis submitted in fulfilment of the London School of Economics requirements for the degree of PhD.. February 1994 1 UMI Number: U062B98 All rights reserved INFORMATION TO ALL USERS The quality of this reproduction is dependent upon the quality of the copy submitted. In the unlikely event that the author did not send a complete manuscript and there are missing pages, these will be noted. Also, if material had to be removed, a note will indicate the deletion. Dissertation Publishing UMI U062B98 Published by ProQuest LLC 2014. Copyright in the Dissertation held by the Author. Microform Edition © ProQuest LLC. All rights reserved. This work is protected against unauthorized copying under Title 17, United States Code. ProQuest LLC 789 East Eisenhower Parkway P.O. Box 1346 Ann Arbor, Ml 48106-1346 f rtcscs i F 7 11 (a Abstract. The purpose of this study is to examine and explain the impact of British business interests, outside of China, on Anglo-Japanese foreign relations and whether these business pressures contributed to the destablisation or amelioration of political tensions. Between 1933 and 1937 there were a series of major commercial disputes between Britain and Japan, in the cotton and shipping industries and over the Japanese treatment of British oil interests in Japan and Manchukuo, which following Japan’s pursuit of an aggressive and unilateral policy in East Asia complicated an already strained Anglo-Japanese relationship. Thus the scale of Anglo-Japanese commercial friction offered substantial scope for political repercussions. In order to assess the impact of business pressure this study will focus upon the relationship between business groups and the British government, which provides the basis for determining the impact of business interests upon British policy towards Japan. By detailing the interaction between government and business this study hopes to establish which factors were most prominent in shaping the govemmenfs response to the demands of business and the needs of Anglo-Japanese relations. This requires the examination of the economic and political factors that motivated business demands for government support, and the economic, political and foreign policy factors that guided the response of the British government. However, it also requires the examination of relationships within business groups and the government as a means of establishing the constraints upon business and govemmenfs response to Anglo-Japanese commercial friction. Conclusions are drawn which indicate that because of an ingrained 'conservatism' to commercial questions both the business community and government avoided exacerbating commercial tensions with Japan, and consequently business interests had only a limited impact upon Anglo-Japanese relations. 2 For my mother and my father. Contents. List of Tables. 6 Preface. 10 Acknowledgements. 11 Chapter 1 : The Lancashire cotton industry and the rise of Japanese competition 12 Introduction 30 The Lancashire and Japanese cotton industries in the world market 32 The Lancashire and Japanese cotton industries in the interwar period 36 Lancashire and the rise of Japanese competition 47 Economic crisis in the Lancashire cotton industry and economic decline 56 Lancashire and the campaign for trade discrimination against Japan 60 Conclusion 67 Tables 69 Chapter 2 : The British government and trade discrimination against Japan 88 Introduction 89 The introduction of trade discrimination against Japan in Britain’s West African colonies 91 The failure of the Lancashire-Japan cartel negotiations 99 The introduction of Colonial quotas on cotton piece-goods 106 Colonial quotas and Anglo-Japanese relations* 1935-1937 111 Trade discrimination against Japan in Dominion and third markets 119 Conclusion 128 Tables 130 Chapter 3 : Lancashire and the Indo-Japanese trade negotiations, 1933-1937 136 Introduction 137 Lancashire and the Indian market in the 1920s 139 The introduction of Imperial Preference 146 The background to the Indian denunciation of the Indo-Japanese trade treaty 151 The denunciation of the 1904 Indo-Japanese trade treaty 156 The Indo-Japanese trade war 162 Lancashire and the Indo-Japanese trade negotiations, 1933-1934 167 The Indo-Japanese trade negotiations, 1933-1934 174 The stabilisation of Indo-Japanese trade relations, and the marginalisation of Lancashire 186 Conclusion 196 Tables 198 4 Chapter 4 : Royal Dutch Shell and the Petroleum and Oil Monopoly Laws 211 Introduction 212 Japan's oil policy 214 The challenge to Royal Dutch Shell and Stanvac’s operations in Japan and Manchuria 221 The British response to the 1934 Petroleum Law and Oil Monopoly Law 226 The limits of Anglo-American cooperation 235 Withdrawal from Manchukuo and survival in Japan 245 Conclusion 257 Tables 259 Chapter 5 : The British shipping industry and Japanese competition 269 Introduction 270 The British and world shipping industries in the interwar period 272 British shipping interests and British shipping policy 277 British shipping interests and the rise of Japanese competition in the Pacific-East Asia region 287 The failure of the British shipping industry's campaign against Japanese competition 294 Conclusion 303 Tables 305 Conclusion. 320 Bibliography. 333 5 List of Tables. Chapter 1. Table IT : Britain and Japan's total cotton piece-good exports, 1911-1936 (millions of yards) 69 Table 1.2 : World production and consumption of textile fibres, 1909/1913- 1928/1929 70 Table 1.3 : Lancashire's percentage of world production and the world export trade in cotton piece-goods (thousands of square yards) 71 Table 1.4 : British, Japanese, and American exports of cotton textiles, 1927-1933 (millions of square yards) 72 Table 1.5 : Comparison of average annual nominal wages for operatives in the British cotton textile industry and the Japanese cotton spinning industry, 1914-1936 (in sterling) 73 Table 1.6 : Comparison of average earnings between female Japanese cotton weavers daily wage rates in the cotton spinning industry, and the Lancashire piece-rate lists, 1914-1936 74 Table 1.7 : Comparison of earnings of female Japanese machine cotton weavers with earnings by female operatives in the Lancashire cotton textile industry, 1914-1936 75 Table 1.8: Changes in labour output per unit of wage and per workday in the spinning sector of the Japanese cotton spinning industry, 1914-1936 76 Table 1.9: Changes in labour output per unit of wage and per workday in the weaving sector of the Japanese cotton spinning industry, 1914-1936 77 Table 1.10: Comparison of worker output between the American, British and Japanese cotton spinning industries, in 1929 78 Table 1.11: Comparison of wages and output in the Japanese, American, Indian and British cotton spinning industries for operative engaged in spinning yams of up to 40 counts, in early 1932 79 Table 1.12 : Indices of change in output per-man hour between the British, American, and Japanese cotton textile industries 80 Table 1.13 : Comparison between Japanese and Lancashire operatives’ wages for ten hours work, and the same comparison including Pearse's estimate of additional Japanese welfare costs,c\ 1928/29 (in pence) 81 Table 1.14: Comparison of piece-wage rates paid in Japan and Lancashire for winding 100 lbs. of ring yam on to warpers' bobbins, c. 1928/29 (in pence) 82 Table 1.15: Comparison of weavers wages per yard of cloth output between Japan and Lancashire,c. 1928/29 83 Table 1.16: Breakdown of Japan and Lancashire's manufacturing costs for selected types of cotton piece-goods in 1931 (in pence per piece) 84 Table 1.17: Comparison of annual nominal wages between the British cotton textile industry with the British woollen & worsted and nylon & rayon industries: and a comparison of average daily wages between the spinning and weaving sectors of the Japanese cotton industry with the Japanese silk-reeling industry, 1920-1937 85 6 Table 1.18 : Selected statistics of the British cotton industry, 1924-1937 86 Table 1.19: Percentage of unemployed insured workers in selected British industries, 1923-1938 87 Chapter 2. Table 2.1: Total imports of British and Japanese cotton textiles into the British Colonial Empire, 1929-1933 130 Table 2.2 : Imports of British and Japanese cotton textiles into specific regions of the British Colonial Empire, 1929-1933 131 Table 2.3 : Japan's balance of trade with the British Dominions and India, 1931- 1933 (thousands of yen) 132 Table 2.4 : Effect of Colonial quotas on Nigeria’s imports of selected cotton textiles 133 Table 2.5 : Lancashire's exports of cotton piece-goods to selected British colonies after the introduction of Colonial quotas (millions of linear yards) 134 Table 2.6 : Abstract of trade discrimination against Japan in the British Dominions (excluding India) and third countries, in December 1933 135 Chapter 3. Table 3.1: Indian imports of Lancashire and Japan's cotton piece-goods, by volume and value, 1916-1938 198 Table 3.2 : Lancashire and Japan's percentage share of India's cotton piece-good import volume; and Lancashire and Japan’s cotton piece-good exports to Indian as a percentage of their respective total cotton piece-good export volume, 1916-1936 199 Table 3.3 : Indian raw cotton production and raw cotton exports to Lancashire and Japan, 1924-1937 (millions of bales) 200 Table 3.4 : Percentage share of Indian milled cotton piece-good consumption of Indian mill produced cotton piece-goods, and Indian imports of Lancashire