This article looks at the economies of Manchukuo and Mengjiang, in the period 1931-1945. The effective Japanese annexation of 1931 led to a colonial system (see Manchukuo (administration)). Japan invested in heavy industry, and to a lesser extent, agriculture.
The General Affairs State Council retained Japanese control of official economic policy. The Central Bank of Manchukou was the national central bank. The Kwantung Army held the highest authority, representing the Emperor of Japan, and the respective ministries of the nominal Manchukou central government were also involved. Industry
After it occupied Manchuria, Japan took over the region's Chinese public enterprises (many of which originated from the Zhang Zuolin and Zhang Xueliang regimes) and converted them to Manchukuo state-owned enterprises.
Industrial development in Manchukuo was accomplished with state planning and Japanese investment, prioritizing military build-up and heavy industry without an emphasis on profitability.
Economic planning in Manchukuo was influenced by Japanese observations of the Soviet approach to catch-up industrialization and reflected in Manchukuo's Five Year Plan for Heavy Industry. The development of industry in Manchukuo further influenced Japanese economic mobilization following the start of the Second Sino-Japanese War.
In 1932, the Kwantung Army requested that the South Manchuria Railway establish an Economic Research Team. This team drafted many of Manchukuo's early economic policies and emphasized state control over the economy.
Industrial development had as a primary goal supplying raw material and finished products for the Japanese military. Amid the 1930s, thousands of idealistic engineers, most connected with the Home Ministry, left for the neighboring colonies of Taiwan, Manchukuo and Korea, laying down the foundation of a modernized empire, amongst such plans: roads, bridges, railroads, canals, ports, water works, and communications networks were commissioned.
The first industrial centers in Manchukuo were in the Mukden–Dairen area. Industrial centers were in Anshan, Shakakon, Dairen, Ryojun, Fushun, Fusin, and other cities. Manchukuo used the Korean ports of Unggi, Chongjin and Rason for the Japan sea area.
Products included aircraft, automobiles and trucks, blankets, boots, bread and flour, bricks, candies and foods, carpets, raw cellulose, cement, dyes and inks, electrical devices, fabric, farm equipment, glass, industrial paint, industrial paper, liquor and beer, locomotive manufacturing and repair and related railway industries, milk and cheese, mining equipment, munitions, processed leather products, rubber articles, soy and other processed foods, vegetable oil, hand and heavy weapons, etc.
Some measures of Manchu industrial production (1932–35):
Coal production: 15 million metric tonnes of coke coal Cement Production: 10% of Japanese Cement production Steel Production: 450,000 metric tonnes 500,000 spindles and accompanying fabric factories annually produced 25,000 tonnes of cotton fabrics. During Manchukuo's first Five Year Plan, Germany was a major supplier of sophisticated industrial technology to Manchukuo.
Industrial workers Japanese and Manchukuo authorities used Chinese prisoners of war for forced labor. Many of these POWs were Chinese civilians abducted by the Japanese army from unoccupied China. Manchukuo used forced labor in major industrial enterprises, including Shōwa Steel Works.
Agriculture
The effective annexation gave Japan an area suitable for farming, such as scarcely existed on the country's islands, or other parts, generally mountainous, of the Empire of Japan. The area was primarily agricultural in character, although with some urbanization. Agriculture employed 85% of the population.
Farmers produced many crops, particularly on the southern plains. Manchu farms practiced crop rotation frequently with primitive culture methods. Kaoliang (70%), corn and maize (70%), wheat (80%) and soy (35%) were popular crops.
Others in quantity were: alfalfa, apples, apricots, chestnuts, col, cotton, cucumber, forage, garlic, giant radish, hemp, indigo, lupulus, millet, nuts, onions, opium poppies (for opium), peaches, pears, peanuts, rice, ricine, rye, sesame, sugar beet, sweet potatoes, thyme, tobacco, and others. In Amur land (Manchu side) honey (1,800 tonnes) was collected.
From kaoliang and corn liquors were made, including vodka, sake, beer, soy juices and vinegar. The modern wheat and flour industry was located in Harbin from Russian times apart from basic mills in other areas.
The most intensive farming occurred in a zone, extending from the Liaotung Gulf to the Northwest. In 1934 it totaled between . The proportions of the principal crops in 1934 were:
Soy: 28% Corn: 9% Other legumes: 2% Wheat: 7% Kaoliang:(Zahine-Sorgum): 23% Rice: 2% Mice: 18% Other crops: 11%
Soy Soy was Manchukuo's principal crop.Yoshihisa Tak Matsusaka, The Making of Japanese Manchuria, 1904-1932 (2001), p. 128. The first exports were made in 1908 to England. The economic expansion of soy is attributed in great part to the South Manchurian Railway Company, which enabled direct export from Dairen abroad, in particular to China and Japan proper. Manchukuo hosted many types of processing mill. 1933 to 1934 saw a reduction of more than in cultivated extent and production fell from 4-6 million to 3.84 million tonnes.
The Japanese developed industry to use soy, with average production of 1,500,000 tonnes. Half was exported to Europe. Crude oil paste for fertilizer and soybeans for food was sent to Japan. The rest of the plant was used in cellulose factories.
Cotton Manchukuo regularly produced 120,000 kilograms of mediocre quality.
Opium poppies
The opium poppy was grown to obtain opium. In November 1932 the Mitsui Zaibatsu conglomerate held a state monopoly for poppy farming with the "declared intention" of reducing its heavy local use. Fixed cultivation areas were set up in Rehe and northwest Jilin. For 1934-35, cultivation area was evaluated as with a yield of 1.1 tonnes/km2.
According to Japanese scholar Goichi Yamada, the opium trade in Machuria generated profits ranging from 2 million to 14 million yen per year.
The military prohibited the use of opium and other narcotics by its troops (punishment was loss of Japanese citizenship) but the army was allowed to use money generated by opium trading to finance the war. Professor Motohiro Kobayashi of Tokai University said the Japanese army's intelligence division worked with local gangs to sell opium.
One of the participants, Naoki Hoshino negotiated a large loan from Japanese banks using a lien on the profits of Manchukuo's Opium Monopoly Bureau as collateral.
Opium Trade with Nazi Germany According to Professor Naoki Kumano of Kyushu University, part of the produced opium is exported to Nazi Germany as part of a trade deal. Originally, Nazi Germany imported soy beans from Manchuria. However, Manchuria was unable to fulfill the trade obligation due to bad harvest of soy beans in 1941. Instead, opium is used as replacement. The opium exported to Germany is mainly used to produce morphine. The opium trade continued until the end of World War Two.
Spring Wheat Region Precipitation: Growing season in days: 196 Cultivation area: Total percentage of cultivated land: 13-18% Total percentage of tenant farmers: 6% Cultivated area per farm: Peasant population density in principal farming:
Product by sector Wheat: 18% Maize: 34% Irish potatoes: 10%
Livestock Oxen: 21% Donkeys: 15% Sheep: 28% Mule: 11%
Fruit Nuts and pears
Soy and Kaoliang Manchu Region Precipitation: Growing Epochs for days: 150 Cultivation area: Total percentage of cultivated land: 5 to 20% Total percentage of tenant farmers: ? Cultivated surface per farm: Peasant population density in principal farming:
Percentages and distribution surface of products Wheat: 10% Maize: 15% Soy: 10% Kaoliang: 25%
Fruit Pears
Transport Oxen, donkeys, heavy horses transported the harvest. Xing'an province worked horses and Bactrian camels, and Heilongjiang and Jilin provinces used sled dogs to aid transport.
Pack animal: 76% Carts: 38% River boats: 13%
The cultivable land was estimated as principally in the central plain.
Manchukuo - Heilongjiang: Percentage total of land cultivated: 5.2% Land cultivated per person:
- Jilin: Percent of land cultivated: 14.4% Land cultivated per person:
- Liaoning: Percent of land cultivated: 16.8% Land cultivated per person:
- Rehe: Percent of land cultivated: 6.1% Land cultivated per person:
Meng Chiang - Chahar: Percent of land cultivated: 4.1% Land cultivated per person:
- Suiyuan: Percent of land cultivated: 3.7% Land cultivated per person:
Animal husbandry Manchukuo was a productive area, with many domestic animals in subsistence farms or larger properties. Japanese experts increased production with the introduction of foreign species, including pigs, cattle, and sheep, which produced milk, meat, leather and wool.
Other interesting products were the silkworm and the wild silk or tussah (tussor) Worm. The first needed the white mulberry for food; and the second needed Quercus mongolica and other species of oak tree to make Tussah silk. Both products were collected for dyeing and export to Europe and America or sent as raw material to these markets. The cocooned worms were sent to China and Japan. The production of Tussah Silk or pongee was in Kaiping and Andong (Liaoning Province) while silk worms stayed in Kwantung (Kantoshu) and South Manchurian Railway zone, and Chosen.
Output In bushels per acre, except cotton in kilograms. CountryRiceWheatCornMaizePotatoCotton packsChina6716211987168Japan68252236139199India291115 - -80Soviet Union47101516128188USA - 142522108177 In Chientao or Yenki Manchu district the Korean Colony extensively cultivated rice.
Forestry products Lumber and wood products were important industries. Rehe and Jilin provinces held great expanses of various types of forest. From 1911 to 1931 Chinese lumberjacks began to work there; the volume of cut wood during the Manchu period was some . Foresting took place mostly in the Yalu and Sungari river areas; their tributaries permitted river transport to woodworking centers in Andong, Jilin and Harbin cities. The Tumen and other northern rivers also provided transport. Typical production before 1939 was per year. Uses were: railroad ties, cellulose paste for paper and for Karafuto rayon production, and export to Japan, Russia and Central and Northern China. A similar pattern may have occurred in Mengjiang.
Hunting In the mountains many species of animals could be hunted for their skins, for meat, or for sport. This area corresponds with the current Heilongjiang province. The situation is similar in Mengjiang too.
Coastal, river and lake fishing The rivers Amur, Sungari, Nonni, Mutang-Kiang, Ussuri, Liao, Yalu and Tumen, and the lakes Khanka, Buir-Nor and Hulun-Nor are all important fish sources. Species include trout, salmon, and European perch. With the exception of Buir-Nor and Hulun-Nor, these can be fished only in snow-free months. The latter lakes are useful fish sources for residents in Xing'an Province near the Russian-Mongolia frontier area, and were a cause of frontier disputes.
The annual catch in rivers and lakes was 25,000 tonnes. Sea fishing was in the Po-Hai Gulf and Yellow Sea areas. It included cod, shrimp, sea bream, lobster, and crab.
Important cities The most important cities were:
Mukden: Population 339,000 Dairen: 203,000 or 555,562 or 661,000 or 766,000 or 400,000 Ryojun: 1,371,000 Harbin: 250,000 or 405,000 Andong: 92,000, 315,242 or 360,000 Xinjing: 126,000 or 544,202 Jilin: 119,000, 173,624 or 512,000 Qiqihar: 75,000 or 537,000 Fushum: 269,919 or 754,000 Anshan: 213,865 or 100,000 Niuzhuang: 119,000 or 158,000 Mudanjiang: 100,000 Kiamuzse: 100,000 Liaoyang: 100,000 Penki: 530,000