The first phase of the forceful penetration of China by western Europe came in the two Opium Wars. Great Britain had been buying increasing quantities of tea from China, but it had few products that China was interested in buying by way of exchange. A resulting steady drain of British silver to pay for the tea was eventually stopped by Great Britain’s ascendancy in India. With British merchants in control of India’s foreign trade and with the financing of this trade centred in London, a three-way exchange developed: the tea Britain bought in China was paid for by India’s exports of opium and cotton to China. And because of a rapidly increasing demand for tea in England, British merchants actively fostered the profitable exports of opium and cotton from India.

An increasing Chinese addiction to opium fed a boom in imports of the drug and led to an unfavourable trade balance paid for by a steady loss of China’s silver reserves. In light of the economic effect of the opium trade plus the physical and mental deterioration of opium users, Chinese authorities banned the opium trade. At first this posed few obstacles to British merchants, who resorted to smuggling. But enforcement of the ban became stringent toward the end of the 1830s; stores of opium were confiscated, and warehouses were closed down. British merchants had an additional and longstanding grievance because the Chinese limited all trade by foreigners to the port of Canton.

In June 1840 the British fleet arrived at the mouth of the Canton River to begin the Opium War. The Chinese capitulated in 1842 after the fleet reached the Yangtze, Shanghai fell, and Nanking was under British guns. The resulting Treaty of Nanking—the first in a series of commercial treaties China was forced to sign over the years—provided for: (1) cession of Hong Kong to the British crown; (2) the opening of five treaty ports, where the British would have residence and trade rights; (3) the right of British nationals in China who were accused of criminal acts to be tried in British courts; and (4) the limitation of duties on imports and exports to a modest rate. Other countries soon took advantage of this forcible opening of China; in a few years similar treaties were signed by China with the United States, France, and Russia.

The Chinese, however, tried to retain some independence by preventing foreigners from entering the interior of China. With the country’s economic and social institutions still intact, markets for Western goods, such as cotton textiles and machinery, remained disappointing: the self-sufficient communities of China were not disrupted as those in India had been under direct British rule, and opium smuggling by British merchants continued as a major component of China’s foreign trade. Western merchants sought further concessions to improve markets. But meanwhile China’s weakness, along with the stresses induced by foreign intervention, was further intensified by an upsurge of peasant rebellions, especially the massive 14-year Taiping Rebellion (1850–64).

The Western powers took advantage of the increasing difficulties by pressing for even more favourable trade treaties, culminating in a second war against China (1856–60), this time by France and England. Characteristically, the Western powers invading China played a double role: in addition to forcing a new trade treaty, they also helped to sustain the Chinese ruling establishment by participating in the suppression of the Taiping Rebellion; they believed that a Taiping victory would result in a reformed and centralized China, more resistant to Western penetration. China’s defeat in the second war with the West produced a series of treaties, signed at Tientsin with Britain, France, Russia, and the United States, which brought the Western world deeper into China’s affairs. The Tientsin treaties provided, among other things, for the right of foreign nationals to travel in the interior, the right of foreign ships to trade and patrol on the Yangtze River, the opening up of more treaty ports, and additional exclusive legal jurisdiction by foreign powers over their nationals residing in China.

Foreign privileges in China

Treaties of this general nature were extended over the years to grant further privileges to foreigners. Furthermore, more and more Western nations—including Germany, Italy, Denmark, The Netherlands, Spain, Belgium, and Austria-Hungary—took advantage of the new opportunities by signing such treaties. By the beginning of the 20th century, some 90 Chinese ports had been opened to foreign control. While the Chinese government retained nominal sovereignty in these ports, de facto rule was exercised by one or more of the powers: in Shanghai, for example, Great Britain and the United States coalesced their interests to form the Shanghai International Settlement. In most of the treaty ports, China leased substantial areas of land at low rates to foreign governments. The consulates in these concessions exercised legal jurisdiction over their nationals, who thereby escaped China’s laws and tax collections. The foreign settlements had their own police forces and tax systems and ran their own affairs independently of nominally sovereign China.

These settlements were not the only intrusion on China’s sovereignty. In addition, the opium trade was finally legalized, customs duties were forced downward to facilitate competition of imported Western goods, foreign gunboats patrolled China’s rivers, and aliens were placed on customs-collection staffs to ensure that China would pay the indemnities imposed by various treaties. In response to these indignities and amid growing antiforeign sentiment, the Chinese government attempted reforms to modernize and develop sufficient strength to resist foreign intrusions. Steps were taken to master Western science and technology, erect shipyards and arsenals, and build a more effective army and navy. The reforms, however, did not get very far: they did not tackle the roots of China’s vulnerability, its social and political structure; and they were undertaken quite late, after foreign nations had already established a strong foothold. Also, it is likely that the reforms were not wholehearted because two opposing tendencies were at play: on the one hand, a wish to seek independence and, on the other hand, a basic reliance on foreign support by a weak Manchu government beset with rebellion and internal opposition.