ARI Working Paper Series

Studying the Hong merchant houses in Canton provides us with a unique glimpse into the inner-workings of the Canton System. Tan Suqua was one of the most well-known Hong merchants of the early-eighteenth century. His family ran the prominent and respected firm, the Guangshun Hang, which was one of the pillars of the trade for half a century. But Suqua’s success, was also his nemesis, because the great influence he had with government officials brought him under the suspicions of Beijing and landed him in jail for a couple of years.

He managed to clear the charges against him, and later re-emerged as one of the prominent players in the trade again. By examining the ups and downs of the Guangshun Hang we begin to see more clearly the strengths and weaknesses of China’s foreign trade policies in general. It was not enough to simply know how to run a business.

Diplomatic skills were essential for survival, as negotiating with government officials was an ongoing affair that could make or break the best of the Hong merchants. But in the end, the odds were often stacked against them, as one after another firm fell into the Hong merchant trap of debt-loads outpacing incomes and no way to voluntarily quit the trade.