History of tea in Hong Kong: tea, opium and the balance of trade
Even the most casual visitor to Hong Kong cannot fail to notice what a uniquely vibrant Asian city it is. Hong Kong is exciting, different, exotic and welcoming all in one. It’s basically Chinese (most residents are Cantonese) but most people speak English and almost everyone is engaged in some kind of trade.
For most visitors, Hong Kong is a place of beauty, excitement and wonder from the moment they arrive to the moment they leave.
Hong Kong consists of three parts: Victoria Island and the surrounding islands, Kowloon, located at the tip of the peninsula that leads to mainland China, and the rest of the peninsula known as the New Territories. Between Victoria Island and Kowloon was a world-class port that put Hong Kong on the map as a gateway to China.
The main drink of choice is tea in one form or another and all meals are usually accompanied by cups of steaming black, green or pu-erh tea. Hong Kong has more than 13,000 restaurants, and tea is the main drink in almost all of them.
Tea is more than just a drink in Hong Kong – it is a way of life rooted in the very fabric of the culture. But it should be noted that Hong Kong is not a producer of tea, nor is it simply a consumer of fine Chinese tea.
However, Hong Kong played one of the most important roles in introducing Chinese tea to the West in general and Britain in particular, but this role was won at a heavy price.
Chinese tea, Hong Kong and the British Empire
During the 17th century, Dutch and Portuguese traders introduced Chinese tea to the European mainland, and British traders soon followed suit.
Tea imports grew slowly into Britain due to high taxes on what was considered a luxury item and the monopolistic business practices of a small number of importers such as the John and East India companies. However, the tea was so popular and the demand was so high that smuggling and adulteration of tea supplies became rampant.
Eventually, enlightened fiscal policies and distribution channels were opened, smuggling evaporated, and demand for tea increased by all classes of the English population. Supplies increased dramatically and tea drinking has been a part of English culture to this day.
In the 19th century China was the main supplier to the British and by 1830 annual imports of Chinese tea into Britain amounted to 30 million pounds of tea or an average of 2 pounds of tea for each citizen.
In addition to its place in British society as the most popular drink, tea was central to British wealth due to the tax revenue it generated and the wealth it provided to powerful British trading companies.
british trade
In the mid-19th century, Britain was considered the first mercantile empire, and British manufactured goods were sold and traded throughout the world. As the leader of the Industrial Revolution, Britain produced high-quality consumer goods that served as trade items through strategically located outposts around the world.
Many of these outposts were established and supplied by the formidable British army and navy in what would become the linchpin of British imperialism.
Due to the trade imbalance caused by the increasing level of tea imports, Britain was eager to expand trade with China in order to equalize trade and resolve its trade deficit balance. China was seen by most trade experts as the world’s largest untapped market.
Cultural differences, the demand for bullion and the opium wars
While Britain was eager to trade using its supply of manufactured goods, China was not. Based on a different cultural vision according to which merchants and merchants were seen as part of a lower caste and with suspicion. Foreign traders were particularly suspicious. These merchants were restricted as to what goods they could sell and where they could sell them. China imposed high tariffs and traders were extremely limited in their trading activities.
Add to this fact that China was basically a closed society and the result was a Chinese claim that sales of tea required payment in silver bullion rather than trade goods. Since Britain did not have enough silver to meet the demands, a conflict arose. To overcome this problem, Britain devised an aggressive strategy that included importing opium and eventually outright war.
In an attempt to reverse the balance of trade, the British imported increasing amounts of opium into China. Opium, a highly addictive drug produced in the Bengal region of India, was controlled by Great Britain as a result of the British annexation of Bengal in 1757.
As more and more Chinese became addicted, the trade balance reversed. To pay for the increasing volume of opium imports, silver began to flow out of China into British coffers. However, Britain was still at risk because trade was still conducted in mainland China under the control of the Chinese emperor and bureaucracy.
In the late 1830s, to curb the damage caused by opium to the Chinese population, Chinese officials confiscated and destroyed thousands of chests of opium stored in the warehouses of English merchants in Canton China. Because of these events on the mainland, Britain needed a British-controlled offshore base of operations and Hong Kong, then a sleepy fishing village whose main export was salt, was an ideal candidate.
Under directives put forth by Queen Victoria, Britain sent a naval expeditionary squadron to China. This action resulted in the first Opium War (1839-42), which China, faced with overwhelming military force and reinforced troops from India, lost.
The Treaty of Nanking, which ended the war, forced the Chinese to open up five ports to foreign trade, abolish the cohong (state trade monopoly system that restricted imports), drastically limit the amount of customs duties they could collect, pay an indemnity of 21 million silver dollars, cede Hong Kong Island to Britain, and grant not only Britain, but also its allies, extraterritoriality, making Westerners immune from Chinese law.
As a result of the First Opium War, Britain not only opened up trade with China, but also established a base of operations in Hong Kong that would remain until the island was returned to China in 1997.
These terms adversely affected the common people. Unemployment rose substantially, particularly in Canton, where the tea trade was a major business. Smaller, locally owned industries, unable to compete with imported factory-made goods, declined, depriving many peasant families of an important source of supplementary income. Taxes skyrocketed as the government tried to raise enough funds to pay the indemnity. And as opium continued to flow into the country, the number of addicts multiplied. Millions of lives were affected and often ruined.
As the British foothold on Victoria Island and Kowloon was consolidated, the British sought to expand their vantage point and fought in the Second Opium War in 1856. Given the overwhelming technological advantage of the British, the Chinese were defeated and they were forced to accept a humiliating peace.
Under the terms of the Treaty of Tientsin (1858), the Chinese opened new ports for trade and allowed foreigners with passports to travel inland. The rest of the Hong Kong peninsula (the New Territories) was ceded to Britain and Christian obtained the right to spread the faith from it and own property, thus opening up another means of Western penetration. The United States and Russia obtained the same privileges in separate treaties.
Despite the dislocation and tragedy on the mainland, Hong Kong grew and prospered in a capitalist world. China continued to suffer under various warlords and revolution and remained a third world country until recently. However, Hong Kong became a world center of trade and finance, and its citizens prospered. Hong Kong remained under British rule until 1997, when it was returned as part of mainland China.
Hong Kong’s prosperity continues to this day, but it began with the import and export of tea.