What is a Tai Pan?
A business person of enormous power and influence, or a foreigner who is a chief executive of a company operating in China.
Historical Background
17th Century
The Qing Dynasty (1644-1911 A.D.) generally followed an isolationist, closed-door policy. However due to the influx of foreign envoys during the 17th century, the Emperor Kang-Xi, established Guangzhou, Zhangzhou, Ningbo and Yuntaishan as trading ports in 1685 A.D. Even so, foreign trade in China was limited.
18th Century
In November 1755 A.D., Emperor Qian-Long, designated Guangzhou as China’s sole foreign trade port. By 1757 A.D., the Shisanhang, a monopoly of thirteen Chinese trading houses, heavily regulated all foreign trade under the authority of the Qing government. They set prices and collected tariffs from foreign merchants such as the English and French East India Companies, who were also forbidden to interact directly with the Chinese public. Discontentment among the British first peaked from a trade imbalance: the British imported more Chinese tea than they exported. Therefore, British merchants started trading opium.
On July 1, 1832 A.D., William Jardine and James Matheson (often considered the original Tai Pans) formed Jardine, Matheson and Company, Ltd., one of the first trading companies in China. In 1833 A.D., the English East India Company lost their exclusive trading rights, opening opportunities for Tai Pan. However, as foreign trade expanded in the 1830’s, Jardine, Matheson and many other Tai Pans met with increasing restrictions imposed by the Qing government to curb the trade imbalance and the opium smuggling.
Out of frustration with the Chinese, Jardine headed to England in 1840 A.D. with a petition signed by his peers and a detailed war plan known as the 'Jardine Paper', with which he successfully persuaded Parliament to wage war on China (the First Opium War). By 1841 A.D., the Jardine, Matheson and Company, Ltd. had become the largest trading firm in Asia. Jardine and Matheson therefore established themselves as the most influential figures of the era, often referred to by other traders as "Tai Pan".
Treaty of Nanjing
On August 29, 1842 A.D., the British forced the Chinese to sign the Treaty of Nanjing. The Tai Pans had great influence in drafting the treaty terms which stated that China would:
- Establish trading posts in Guangzhou, Fuzhou, Ningbo, Shanghai, and Xiamen,
- Surrender Hong Kong Island to Britain,
- Abolished Chinese laws governing foreigners, and
- Abolished the Shisanhang to enable an increase of foreign imports into China.
Treaty of Tianjing
Since the Chinese had been forced into signing the Treaty of Nanjing, they were reluctant to honor the terms. This angered the British merchants. Opium smuggling also continued, causing further discontentment among the Chinese towards foreigners. In 1856 A.D., disputes broke out again, initiating the Second Opium War.
In 1857 A.D., Britain enlisted support from France and invaded Guangzhou. As their armies advanced towards Tianjin in June 1858, the Qing High Commissioner Guei-Liang negotiated and signed the Treaty of Tianjin which stated that China would:
- Recognize and abide by the Treaty of Nanjing,
- Permit Great Britain to appoint Ambassadors, Ministers, or other Diplomatic Agents to the Court in Beijing (which was originally closed off from foreigners),
- Permit Missionaries to spread Christianity and own property,
- Permit foreigners to travel for pleasure or trade inland,
- Permit foreign ships the authority to trade on the Yangtze River
- Establish ten, foreign trading ports instead of five at: Chaochou, Guangzhou, Fuzhou, Hainan, Ningbo, Shanghai, Taiwan, Tangchou, Xiamen, and Yingkou, and
- Compensate Britain with four million taels of silver
- Compensate France with two million taels of silver
In 1858 A.D., Russia, taking advantage of the weakened Chinese army, also invaded China from the north. Russia forced the Qing Government to sign the Treaty of Yuan Hun which permitted the Russians to occupy 60 square kilometers of land at the north of Hei Lung Jiang and the south of Wai Xin An Lin.
Convention of Beijing
Unfortunately, the Second Opium War did not end until October 1860, when the Convention of Beijing was signed by the Qing Emperor Xian-Feng. This finally secured foreign trade in China for all Tai Pans by:
- Enforcing the Treaty of Tianjin (1858),
- Opening Tianjin as a foreign trade port,
- Surrendering Kowloon to Britain,
- Legalizing the Opium Trade, and
- Compensating Britain and France with eight million taels of silver.
With all the treaties resulting from the Opium wars, trade with China expanded instantaneously, marking the commencement of the Tai Pan era.
Historical Tai Pans
William Jardine (1784-1843 A.D.)
Jardine, Matheson and Company, Ltd.
One of the First Trading Companies in China
James Matheson (1797-1874 A.D.)
Jardine, Matheson and Company, Ltd.
One of the First Trading Companies
Thomas Sutherland (1834-1923 A.D.)
Hong Kong and Shanghai Banking Corporation (HSBC)
Banking Facilities established in Hong Kong in March 1865
James Tait
Tait Asia, Ltd.
Trading Company established in Xiamen, China in 1845
John Dodd
Pioneer of Taiwan’s Tea Industry in 1869
