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Asian Merchants and Businessmen in the Indian Ocean and the China Sea

Author(s):Lombard, Denys
Aubin, Jean
Reviewer(s):Giraldez, Arturo

Published by EH.NET (November 2000)

Denys Lombard and Jean Aubin, editors, Asian Merchants and Businessmen in the Indian Ocean and the China Sea. New Delhi: Oxford University Press, 2000. iii + 375 pp. $35.00 (cloth), ISBN: 0195641094.

Reviewed for EH.NET by Arturo Giraldez, Modern Languages and Literatures Department, University of the Pacific.


This collection of essays was edited in 1988 by two professors of the L’Ecole des Hautes Etudes en Sciences Sociales in Paris and was published originally in French by the institution’s publishing house. The volume was produced after a conference on the same topic organized by these two eminent historians some years before. As Sanjay Subrahmanyam points out in the “Foreword,” it was a response to the perspective taken by Dutch historians of the Early Modern Period who considered the trading world of Asia in terms of the European Companies and the reaction of ‘non-Western’ societies. The economic dynamism was perceived as coming from Europe and acting upon backward economies. Denys Lombard and Jean Aubin tried to promote a contrary view of an Asian history “that was largely controlled by its internal rhythms, even if related in complex ways after 1500 to various forms of European commercial and political presence” (Subrahmanyam, p. i). This historical debate is not new; it follows controversies involving specialists in Indian, Chinese and African histories. Despite the twelve-year lapse between the French version and the current translation, these essays come at a time when the debate between Eurocentric paradigms and new historiographic perspectives is taking on a new life. The work of Andre Gunder Frank, Ken Pomeranz and R. Bin Wong, among others, place China and the ‘rise of the West’ in a different light, showing the importance of China in world history before the beginnings in Britain of the so called ‘Industrial Revolution.’ (See Andre Gunder Frank (1998) ReORIENT: Global Economy in the Asian Age, Berkeley: University of California Press; Kenneth Pomeranz (2000) The Great Divergence: China, Europe, and the Making of the Modern World Economy, Princeton: Princeton University Press; and R. Bin Wong (1997) China Transformed. Historical Change and the Limits of European Experience, Ithaca and London: Cornell University Press. A recent exposition of the ‘Eurocentric’ paradigm is David Landes (1998) The Wealth and Poverty of Nations: Why Some Are So Rich and Some So Poor, New York: Norton. For a criticism of these ideas, see James M. Blaut (2000) Eight Eurocentric Historians, New York and London: Guilford Press.)

Despite inherent theoretical problems related to the meaning of the term ‘Europe,’ with even greater confusion in the case of the term ‘West,’ those intellectual constructs form the basis of historical interpretations of wide acceptance. This set of ideas considers past developments in the “European West” as essentially endogenous processes that produced economic and social institutions whose rationality and efficiency renders them the paradigm of economic modernization. Eurocentric views have the common trait of creating an intellectual template to be applied to the transformations of other societies and ranking them accordingly to the similarities and differences from an ideal historical development. To counteract this view, Denys Lombard and Jean Aubin have collected a vast array of articles dealing with the dense network of exchanges from the Persian Gulf, the Red Sea and the African East Coast to the shores of China and Japan. The Europeans — Portuguese, Spaniards, English and Dutch — took advantage of pre-existing dense economic networks but their disruptions did not essentially upset their control by Asian powers until the nineteenth century.

Four main themes structure the authors’ historiographical perspective: 1) “Harbor Towns” as centers of economic stimulation; 2) The role of Islam in developing merchant networks since the ninth century; 3) The study of merchant ‘diasporas'; and 4) The ‘Continuity’ of business in Asia.

Chronologically, the collection begins with Chen Dasheng and D. Lombard’s “Foreign Merchants in Maritime Trade in ‘Quanzhou’ (‘Zaitun’): Thirteenth and Fourteenth Centuries” and ends with “The Major Japanese Groups of Enterprises (Kigyoshudan), Heirs to the Zaibatsus” by Bertrand Cheng. This time span was chosen to avoid an Asian economic history “in which all exchanges are seen through the prism of a periodization, whose pulse is to be found in Lisbon, London or Amsterdam” (Lombard, p.3).

Cities were crucial to trade in Asian waters. Denys Lombard distinguishes between the ‘hydraulic’ city connected to an agricultural space and merchant cities, which depended, in fact, on the maritime nexus and its links with foreign land (p.114). An early case was Quanzhou in China: “a precursor of the merchant cities that we shall later see at different points of the Indian Ocean.” (Dasheng and Lombard, p.20). Luis Filipi F.R. Thomaz studies Melaka in the sixteenth century. Genevieve Bouchon places Calicut in relationship with the Arab world, Ceylon, the Moluccas and the trade with China. Studying the city-port of Surat, Ashin Das Gupta discovers how the arrival of the Dutch and English and the Portuguese departure opened a window of opportunity for Indian merchants to became ship-owners (pp.105-112). This is a good example of how Asian entrepreneurs were able to take advantage of changes produced by the European presence.

Islam played a great role in merchant networks after the ninth century. We find Muslim communities in Quanzhou in the eleventh century; by the sixteenth century they were present in Hurmuz, Malacca, Mindanao and Manila. “As late as the 19th and 20th centuries, Islam continued to animate a whole series of intermediate networks from one end to the Indian Ocean to the other” (Lombard, pp. 5-6). Several authors study these Muslim merchants: Hadramis, Gujaratis, Ismailis, Bohras, Kashmiris, Panthay, and so on.

One of the most intriguing aspects illustrated by these essays is the “continuity” of merchant family networks and how they took advantage of the opportunities provided by different social contexts. When “Saudi Arabia developed into a petro-economy state, it attracted a flood of Hadrami emigrants; two Hadrami multi-millionaires were known everywhere, Bin Mahfuz and Bin Laden” (R.B. Serjeant, p.149). Hadrami origins come from Yemen. Claude Markovits studies other industrial groups in India like the Kasturbhais family of Gujarati merchants whose ancestor, Shantidas Zaveri, was ‘jeweler’ to the Mughal Imperial Court. The family owned textile factories but during the 1960s the group expanded into the chemical industry in collaboration with European companies, ICI and CIBA. They passed from traditional merchants to modern industrialists: “This adaptation has been achieved without any basic modification in the working methods or in the forms of organization” (Markovits, p.318). Similar cases can be found among the Chinese Hakka studied by Claudine Salmon. In 1862 Aw Chi Ching, a Hakka doctor from Fujien settled in Rangoon where he practiced traditional medicine and sold medicinal herbs. His descendents marketed a remedy called “Tiger Balm” of great mass appeal. They began advertising in Chinese newspapers in Hong-Kong, Macao and Northern China. To fight competitors in the balm business they bought newspapers in Guandong, Amoy, Singapore, Hong-Kong and Penang. Despite losing their properties in China after the Revolution, the family overcame the post World War crisis. A successor, Sally Aw, bought newspapers in Hong-Kong and Australia and also invested in a variety of businesses. The Hakka network was a great contributor to family success. After World War II one family member founded the first Hakka Bank in Singapore, the Chong Qiao Yinhang.

The vicissitudes of business development in Japan are well exemplified by one prominent conglomerate of the country: “The Iwasaki family had created the Mitsubishi company, which was the result of a commercial enterprise installed in Nagasaki and financed by the Tosa fief. It had closely collaborated with the earlier Meiji administrations” (Akamatsu, p.365). Before World War II Mitsubishi was one of the ‘Big Four’ Zaibatsus — the others being Mitsui, Sumitomo, and Yasuda. “However, as early as the 1950s, a new type of structure called kigyoshudan emerged to regroup the erstwhile zaibatsus” (Chung, p.367). Mitsubishi is one of them. The previous cases go beyond mere anecdote, implying large theoretical issues. In the words of Lombard (p. 7): “The question still remains whether the recent development of Asian capitalism is a reproduction of Western capitalist systems or an outgrowth of an independent stand taken with regard to them.”

Asian merchants were not always able to develop into industrialists. Another completely different role was the symbiotic relationships between Chettiars and Kalangs with European powers. The Chettiar studied by Hans-Dieter Evers were a Tamil caste of South India. Initially they were moneylenders whose activities expanded to South Africa, Mauritius, Ceylon, Burma, Malaya, South Vietnam and Indochina at the end of the late nineteenth century. The Chettiar expansion coincided with development in South-East Asia of the corporate plantation system and the mining and logging industries. “The Chettiar money-lenders played a major role in the transformation of the remaining peasant subsistence economy and connecting it with the export crop-producing sectors” (Evers, p. 206). They also provided capital to Chinese, Burmese, Pathan and Sinhalese moneylenders, but at the same time were connected with European banking institutions. “Chettiar agents had turned peasants into ‘capillaries of a network of financial arteries leading to the banks of London and Paris'” (Evers, p. 208). The Kalangs are a group of Javanese merchants studied by Claude Guillot. Fatimah, a Kalang woman, involved herself in money lending, like her mother, and in buying and selling gold. The gold was melted down and made “into pure gold ingots that Fatimah personally took to sell to the Javasche Bank in Batavia.” After World War I, this bank “introduced Fatimah to diamond merchants from Antwerp.” The family became the most prominent diamond merchants of the Dutch East Indies (Envers, pp. 272-73).

One might criticize the editors’ decision to “set aside all that we know of the European networks” (Lombard, p.4). Ignoring the presence of the Europeans in Asian waters implies ignoring the substantial links developed between Asian economies, America and other colonial powers. For instance, the Chinese tributary system used Japanese and American silver as one of its main monetary substances; and in the nineteenth century the Atlantic economy, Australian gold, Chinese tea and Indian opium formed a network of exchanges with the British playing a pivotal role. This observation does not detract from the quality of the collection. The essays are full of information and their findings should be carefully incorporated into current historical narratives.

Denys Lombard and Jean Aubin were much aware of the difficulties of studying Asian economies. Whereas European companies and countries contain rich sources amenable to statistical treatment, that is not the case for many economies in the Indian Ocean and China Sea. That explains why many of the essays’ authors use biographical sources and anthropological research to fortify their cases. However, to dismiss their findings because of lack of statistical information would be a serious mistake. In so-called western societies many economic activities are not reported in a reliable numerical form, such as the drug trade that forms part of the, non-reported, “submerged economy.”

Sanjay Subrahmanym’s “Foreword” finishes with the following thoughts that express very well the book’s theoretical relevance. “It is a timely reminder, at the end of the twentieth century, that the family firm, the merchant community, and the networks of capital-raising and investment based on kinship, affinity, and sociability, are still a reality that one needs to contend with, in Asia, but also perhaps in Europe and even in America” (p.ix).

Overall, this is an excellent collection that is tremendously useful for the historian and social scientist willing to get acquainted with aspects of economic and social history usually known only to specialists. It is a deep loss that both Jean Aubin and Denys Lombard are no longer with us. Both were great examples of an excellent French tradition in social sciences. Also two other contributors to the volume, Ashin Das Gupta and R.B.Serjeant died in the last decade of the twentieth century. The book is a great occasion to get acquainted with their work.

Arturo Giraldez has published several articles (in collaboration with D. O. Flynn) on precious metals in the modern era and has edited Metals and Monies in a Global Economy (Aldershot: Varioum, 1997). Also he is a general co-editor of the Variorum collection The Pacific World: Lands, Peoples and History of the Pacific, 1500-1900.


Subject(s):Business History
Geographic Area(s):Asia
Time Period(s):General or Comparative