Historical Studies (Chinese Edition)

No.1, 2018

 

Interest-Bearing Commercial Loans and Late Qing Finance (Abstract)

 

Li Wenjie

 

Interest-bearing commercial loans were domestic debts issued by the Qing government during the first Sino-Japanese War. Their interest rate, the issuance of printed notes documenting the loan, and the sources of repayment were copied from the Qing government’s foreign debts at the time. The loans focused on borrowing from merchants in the developed areas and port cities, with the dual maritime customs system being applied to bond sales and repayments. The great majority of the borrowed money was delivered to the Ministry of Revenue after the war rather than being directly used for the purposes of the war. Because the Ministry of Revenue set the amount of the loans and because local governments in some provinces appropriated loan administration, arbitrary apportionment and extortion were inescapable. However, owing to the unique functioning of the dual maritime customs system, the repayments were guaranteed by customs revenue. Except for a handful that became factory equity or were retained as donations, the loans were repaid on schedule.