Abstract
Under the 1930 blueprint, the plan was to establish a double-tier financial system with the Farmers Bank of China driving the development of irrigation and production cooperatives as well a cooperative lending at the village level, and the proposed central agricultural bank—the Agricultural Bank of China—to drive land credit, sales and supply cooperatives, and fund village Farmers Banks. Only half of this plan was set in motion with the expansion of the Farmers Bank of China in 1935. By 1936 there was a sense of urgency to fully developing a nationwide structure and coordinating the organization for the provision of not only farm credit, but also credit for the development of agricultural infrastructure and related agricultural business interests. To deal with the many issues there was a need to coordinate a large number of agricultural activities, like rural credit, agricultural management, and technology. This was done under an administrative department called Nong Ben Ju. This chapter explores the genesis and outcomes of Nong Ben Ju (the Farm Credit Bureau) and related policy initiatives in the late 1930s and into the 1940s.
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Jie Mu (1937). Banks investing Rural Areas under Policy of New Currency, Statistics Monthly, no.31.
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Before a more detailed survey of agricultural loans of commercial banks, it is perhaps necessary to define the exact meaning of commercial banks mentioned here. With the only exception of the Central Bank, all banks in Republican China may be included in the general term ‘commercial’, since their chief banking activities consisted of commercial credit, despite the fact that they took on misleading names such as ‘industrial’, ‘agricultural’, ‘provincial’, and even ‘state’. Under such a broad definition two of the government ‘Big Four’ banks, the Bank of China and the Bank of Communications may also be included. It was also true that after the commencement of hostilities with Japan many Tianjin and Northeast banks had moved to, or been developed in, the interior provinces. Consequently, banking offices began to scatter throughout China rather than concentrating in major trading centers such as Shanghai and Tianjin. By April of 1936, however, the coming war with Japan was an unknown and so the meeting included the 12 big banks representing the Shanghai commercial banks. The Shanghai banks included the Bank of China, Bank of Communication, Jincheng Banking Corporation, Shanghai Commercial and Savings Bank , China and South Sea Bank, Continental Bank, Yianye Bank, National Commercial Bank, Zhejiang Industrial Bank, Ningbo Commercial and Savings Bank, Manufacturers Bank of China, and the China State Bank.
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Kung, H.H. (1939). War-Time Responsibilities of Local Financial Institutions. Central Bank of China Bulletin. 5(1):1–2.
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Chiang, Kai-shek, (1939). China’s War-Time Production Policy. Central Bank of China Bulletin. 5(3):197–202.
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Kai-Shek, Chiang (1939). Op Cit. (page 201).
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Shaw, Kinn-Wei (1939). Government Policy on Price Regulations in War Time” Central Bank of China Bulletin. 5(4):318–322.
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CBCB (1939). China’s Cotton Spinning and Weaving Industry in War Time. Central Bank of China Bulletin. 5(4):369–373.
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Chiang-kai Shek drew his expertise from the learned class, many of whom were educated in the United States . There were three general managers of Nong Ben Ju while it existed from 1936 through 1942, Chen Zhenxian, He Lien (Franklin Ho), and Mu Ouchu. Chen Zhenxian (1877–1938) got his PhD in agronomy from the University of California in 1907 and gained extensive experience in improving farm implements and water conservatries, in breeding nurseries, and managing farmers’ unions while serving as the Minister of the Ministry of Agriculture & Forestry, Beiyang government.
He Lian (1895–1975) obtained a PhD in economics from Yale University and was a professor of public finance and statistics at Nankai University. He had worked closely for three years with Irving Fisher, concentrating on index numbers. At Nankai, He was quick to establish a program for compiling and publishing index numbers on major economic magnitudes. He founded Nankai Institute of Economics (NIE) in 1931 which promised to teach economics in a manner relevant to Chinese conditions and to conduct research on China’s economy in a way that would enrich teaching and provide textbook materials. NIE became one of China’s leading centers of economics research during the Republican period and pioneered Nankai’s systematic studies of economics of North China industries. Under the leadership of Ho, Nankai extended its graduate instruction and research to the problems of rural reconstruction and to establish close cooperation with the Mass Education Movement, which charted a new direction in the teaching of economics in China. In 1936, He presented fairly comprehensive visions of China’s development problems and appropriate policies which affirmed the general merits of Sun Yat-sen ’s approach to development and emphasis on ‘equalization of land ownership’ and ‘all land to the tillers’. While the KMT under the leadership of Chiang Kai-shek pledged itself to carry out the ideas of Sun Yat-sen, He, being reputedly Chiang Kai-shek’s most trusted economic advisor, became head of the Political Department of the national government’s Executive Yuan in Nanjing and became the general manager of Nong Ben Ju in August, 1937 and remained in high-level government service during most of the war. Mu Ouchu became the third general manager in February, 1941.
Ouchu Mu was a famous national industrialist and a forerunner of the scientific management of enterprises in modern China who actively introduced the advanced thought of enterprise management from the West. He established a set of effective systems of enterprise management and formed a distinctive theory of enterprise management. He sincerely believed in the principle of ‘saving the nation by industry and commerce’ all through his life and established many influential enterprises at that time, probing thoroughly and practically the methods that could develop industry and the Chinese economy vigorously and promote the sound development of enterprises. The main business of Nong Ben Ju was the production, purchase, and sale of cotton and cottonwool. Youci Zhu(1988), Helian’s Memoirs, Beijing: Chinese Cultural and Historical Press,
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San Qiu (1936), The nature and future of Farm Credit Bureau , Collection of papers on Chinese economy, Shanghai Life Press.
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San Qiu(1936), Op Cit.
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Fu, H., Turvey, C.G. (2018). Nong Ben Ju, the Farm Credit Bureau, and the KMT’s Agrarian Policy. In: The Evolution of Agricultural Credit during China’s Republican Era, 1912–1949. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-76801-4_13
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