Economic Effects of Opium on British Colonial China

EconomicEffects of Opium on British Colonial China

Opiumhas been one of the most potent drugs in both the contemporary andconventional human societies. It is produced from poppy plant, withits key narcotic agent being morphine. Poppy plant’s sap which isrich in morphine is obtained from cuts or incisions that are made inthe flower’s bulbous portion, with the harvesting of the sap beinga considerably labor intensive process. Given its potency, it goeswithout saying that it has had immense effects on the populationswhere it is produced and marketed. This is the case for Asiancountries, particularly China where the effects of opium were notonly felt in the productivity of the population (and subsequently,the economy) but also played a key role in what is termed as theopium wars.

Theintroduction of opium to China may be traced back to the Britishencroachment of the territory in the 18thcentury. There were varied trends that had increasingly made itdifficult for England or the Britons to balance their trade with theEast. Scholars note that first, the British increasingly adopted teaconsumption, in which case there was an immense demand for tea fromChina. Indeed, research shows that the London workers, on average,spent 5% of their entire household budget on tea. In addition, thesame period saw the Northern Chinese merchants start shipping theChinese cotton from the inner parts to Southern China (Polachek33). This meant that the Chinese were competing with Indian cottonthat Britons had been using so as to cater for their tea consumptiontendencies (Janin49). In order to avert the possibility for escalation of the tradeimbalance, the Britons strived to increase the amount of gods thatthey sold to China. Unfortunately, this proved to be unsuccessful asthere was little demand for the heavy woolen fabrics in the countryas a large number of people were used to have silk or cotton padding.Essentially, the Britons decided to heighten the Indian productamounts so as to have the capacity to offset the Chinese luxuriesexpenditure. It is noted that Bengal opium increasingly became theonly product that could be provided to China.

Giventhe addictive capabilities of the opium, increased supplies of thedrug naturally resulted in an increase in usage and demand across thecountry. This was in spite of the persistent prohibitions that theChinese officials and government agents. To eliminate the barriersfrom the government, Britons resorted to nondescript techniques so asto enhance the trade including distributing free opium samples tounsuspecting victims so as to get them immediately hooked, bribingthe government officials, as well as assisting the Chinese inestablishing elaborate smuggling schemes that would allow for thetaking of the product to the interior parts of the country (Janin54).

Importanceof Opium to Economic Historians

Thereare varied elements that make opium considerably crucial to economichistorians compared to other commodities that may be traded includingrubber and sugar. Key among them, however, is the highly addictivetrait. Indeed, the psychological and physical dependence that thedrug triggers in a large number of users (Polachek53). Opium, as a commodity, incorporates the potential or capacityfor economic gain particularly for the producers and loss for theconsumers that is way beyond the potential of a large number of othercommodities.

Nevertheless,a minimum of three broad themes come up clearly in researchpertaining to the drug’s economic history. Key among them is thepersistent utilization or consumption of the drug in the accumulationof wealth and power particularly at the state level. In addition,research is dominated by the clash between ethical and economicinterests in the determination of the role that the drug plays in thesociety (Polachek59). Lastly, there is the theme pertaining to the inefficacy ofvarying drug control strategies and regimes in eliminating orlowering the negative social and health consequences pertaining tothe expansive consumption of the drug, alongside its effects ontoday’s management of use of addictive substances particularly foropium and its derivatives.

Ethicalvs. economic interests

Perhapsthe most interesting theme pitted economic interests against ethicalinterests. As a result of the addictive aspects of the drug coupledwith the relative inelasticity pertaining to the consumption and theminimum fluctuations of its price, the drug was considered a reliablerevenue source particularly by the Asian colonial governments.However, there were ethical questions pertaining to theappropriateness of the drug for taxation or even as a legal commoditygiven it was strongly addictive. In other words, the ethicalquestions were whether the state should depend on the revenue derivedfrom selling products that were demonstrably resulting in economicand physical ruin for some of the subjects (HanesandFrank56). Further, there were questions whether, even in instances wherethe state does not directly benefit from the sale of the product, itshould allow the use of the same by the subjects. Nevertheless, it isnoteworthy that Asia or Chinese consumers were simply colonies ratherthan subjects of the Britons, in which case the British had no qualmsusing it for economic and political gains (Polachek66).

Keypartners of the British in the opium trade were the Japanese who notonly sold opium to Asian countries such as China but also launchedpersistent attacks against China. Indeed, they used the Britishtechniques such as bombing civilians in Shanghai and used opium andits derivative drugs such as heroin in Manchuria (HanesandFrank72). This not only increased the revenues or profits that theJapanese derived from the trade but also incapacitated the Chinese,thereby reducing their capacity to resist.

  1. Chinese Government Response

Thereare varying opinions pertaining to the response of the Chinesegovernment to the increasing trade of the drug in the country. Somescholars note that right from the beginning, the Tang Dynasty thatwas in power at that time opposed the importation of the drug to theterritory and engaged in active discouragement of its use throughstigmatization of immorality of the individuals that were using it(HanesandFrank74). Nevertheless, the Britons saw it merely as a product that was indemand in the country and perceived no correlation with morality ordeficiency of the same. Nevertheless, the Chinese were afraid thatthe British government may be increasingly difficult to deal withcompared to the private British merchants, in which case in late1830s, they ended up suspending the delivery of products to shipsthat were flying the British flag. Scholars consider this the Chinesegovernment way of indicating that the British government was usingthe drug so as to control trade pertaining to every other good(Beeching46). Further, the Chinese started destroying British factories whoseoperations were in close proximity or propinquity to the coast. Thisis what, eventually, triggered the opium wars where the Britonscompletely destroyed China and refused to recognize the position ofthe government regarding the immorality of the utilization of thedrug.

  1. Opium as a Tool for Power

Thereare numerous examples pertaining to the utilization of the drug as atool for gaining state power particularly with regard to its role intrade relations and as a source of revenue. It is noted that thetrade in the drug was perfectly beneficial to the Britons, in whichcase the efforts of the Chinese to interfere with the trade was seenas worth fighting against. Britons crashed China between 1856 and1860 in what is known as the Second Opium War, all in an effort tosafeguard its right to trade with the country (Waley67). Essentially, the victory of the Britons ensured that England’saccess to Chinese opium market was unhampered and most importantlythat the Britons would persist in selling the one product in Chinathat managed to eliminate the trade deficit with the country(Beeching86). Essentially, the profits or revenue derived from the sale ofopium gave Britons more capacity to develop more lethal weapons thatcould be used in controlling its Asian interests, as well as theestablishment of other colonies.

Effectson British trade balance

Asearlier stated, the importance of the opium trade primarily revolvedaround its capacity to increase or improve the trade balance andfinance the Chinese luxuries that were finding their way in England.Even as the Chinese government repeatedly banned the consumption andproduction of opium, the East India Company, which was under theCrown’s charter had monopoly as far as trade with China wasconcerned. EIC preferred selling its products at annual auctions tolicensed private firms in order to avert the possibility forjeopardizing the legal trades. The traders would then ship opium inspecially made, as well as heavily armed opium clippers, which weredelivered to fortified ships that were off the coast of SouthernChina ((Baumler56). The opium traffic had immense economic importance for Britons.Indeed, EIC’s profits in auctions made an immense contribution torevenue of the British government, the traders themselves, as well asBritish India and British China government. Scholars note that in the1820s going forward, the trade balance between Britain and China waspositive or rather in surplus (Waley75). This is not surprising given that the money obtained from thesale of opium far exceeded the money paid for the Chinese tea.


Itis undeniable that opium had devastating effects on the Chinesepopulace particularly as a result of the addictive nature of the drugand the reduction of their productivity. In the case of the Britons,the drug had positive effects as it increased the revenues andenhanced the balance of trade. In addition, it enhanced the capacityof the Britons to control and access the Chinese mainland andinlands. Nevertheless, the drug was eventually introduced to theBritish in their own homeland, something that eventually haddevastating effects. Indeed, the effects continue to be felt eventoday.


Baumler,Alan.&nbspModernChina and Opium: A Reader.Ann Arbor: University of Michigan Press, 2002. Print.

Beeching,Jack.&nbspTheChinese Opium Wars.New York: Harcourt Brace Jovanovich, 1975. Print.

Hanes,William T, and Frank Sanello.&nbspTheOpium Wars: The Addiction of One Empire and the Corruption ofAnother.Naperville, Ill: Sourcebooks, 2002.Print

Janin,Hunt.&nbspTheIndia-China Opium Trade in the Nineteenth Century.Jefferson, NC [u.a.: McFarland &amp Co, 1999. Print.

Polachek,James M.&nbspTheInner Opium War.Cambridge, Mass: Council on East Asian Studies/Harvard University,1992. Print.

Waley,Arthur.&nbspTheOpium War Through Chinese Eyes.Stanford, Calif: Stanford University Press, 1968. Print.

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