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負欠外國債權人的債務常常就高達數十萬兩乃至一、二百萬兩【參考表八】，更不用說他們同時也都拖欠中國政府關稅，積欠中國商人大筆債務了。五、結語由於資金有限與週轉的困難，行商籌措現金的代價十分高昂，遠大於他們的可支配利潤（即商品交易的利潤減去營業設施及行商家族的維持費用，再減去官吏的榨取），因此絕大多數的行商都免不了以破產終結。這種情形當時的中國人也看得很清楚。因此時代越往下走，就越少人肯當行商。十八世紀新任的行商尚有少數是出自自願的，十九世紀的新行商則差不多都是政府強迫為之了。這也說明了為什麼十八世紀的新行商大多原來即已從事中外貿易，而十九世紀的新手則多來自廣州城外的小商人或原先地位很低的通事、買辦之流了。事實上行商除了不易賺錢外，行商個人或其經理人也常常遭受到官吏的人身騷擾。因此不但清白富實的人士不願意充當行商，就是僥倖能賺錢的少數行商也想急流勇退。而行商的子孫更視洋行之業為畏途。相反地，地方官則千方百計地想辦法來羅致稍有貲財的人士來擔任行商，而這些人一旦入其牢籠就設法不讓他們退出。義成行的葉上林可以說是唯一成功退休的例子。同文行的潘致祥雖然在 1807年退休（為此他付出了 500,000 兩銀子的代價），卻在 1815年被迫另外開張了同孚行。當他於 1820年去世時，他的長子潘正亨就設法規避政府的命令，拒絕繼任同孚行行商。潘正亨甚至說：「寧為一隻狗，不為行商之首。」 27 __UNDEF__ 可見得拒絕的意志有多強烈了。可是他的幼弟潘正煒卻逃不了充當行商的命運。行商中最富有的伍秉鑑三番兩次地想要退休，都得不到官府的許可（他雖然在 1826年時以 900,000 元或 900,000 兩的代價將官府註冊的怡和行行商的名字改由他的兒子頂替，政府仍然要他負擔所有行商一切的責任）。他甚至說他願意把十分之八的財產（約 20,000,000 元）捐給政府，只要求政府允許他結束怡和行，安享他所餘下的十分之二的財產（約 6,000,000 元）。 28 __UNDEF__ 他的願望未能實現。鴉片戰爭期間，他的麻煩更多了。而他也已是個七十歲的老人了。他寫信給一位遠在麻薩諸塞州的美國友人 J . P . Cushing ，說他若不是年紀太大，經不起漂洋過海的折騰，他實在十分想移居美國。 29 __UNDEF__ 看來鼎鼎大名的伍浩官不但對洋行的工作失望了，對整個中國的社會制度也失望了。富有的人不肯當行商，當行商後幸而致富的人也不肯留在他的行業裡，因此政府只有強迫財力更差的人當行商。這些財力不足的人當了行商之後，自然要面對嚴重的週轉壓力。然而當事的政府官員不但沒有協助他們解決財務上的困難，反而無止休地向他們榨取金錢，加深他們的困難。因此，對絕大多數的行商而言，破產根本是必然的，早在他們一當行商的時候就已注定了。唯一的差別是能力稍強的拖得久些，能力差的早早就破產罷了。 ── 原刊於《新史學》，第一卷第四期（ 1990年 12月）， pp. 1-40 。 INTRODUCTIONWhen the "old China trade" was in its heyday , that is , between 1760 and 1843, it was carried on by the Canton Hong merchants , on the Chinese side. The Hong merchants enjoyed exclusive privilege of trading with Western traders who chose to come to China. Supposedly they should have made a good fortune from such a monopoly. But to the contrary of general expectation , many of them went bankrupt. There were common reasons behind this phenomenon , which I have dealt with , treating them as a group , in my dissertation entitled The Insolvency of the Chinese Hong Merchants , 1760-1843.1 In that dissertation , I mean to say , the business of the Hong merchants was undoubtedly profitable , and their expenses and charges could be covered by their profits , if sufficient capital were provided with. Unfortunately , it was not the case. The want of capital and the dearth of cash in Canton market frequently drew the Hong merchants into financial straits , and they were in consequence subject to exorbitant interest rates or other detrimental methods to raise funds for financing their dealings. Manhop's failure was not an exception to such a pattern , but it was more episodical and more complicated than others'. This paper means to reconstruct the story of Manhop's failure as a case study and to point out some deplorable methods that were adopted by the Hong merchants in their business management.I. MANHOP STARTED HIS BUSINESS WITH HEAVY DEBTSIt was about two o'clock A. M. on the 4th day of February , 1828. William Jardine , senior partner of the Magniac & Co. at Canton , has been staying late for writing a letter to his Parsi friend and business correspondent , Jamsetjee Jejeebhoy of Bombay. He could not postpone the writing till morning , partly because the ship Jamesina was about to set sail for Bombay , but mostly because the failure of Manhop , the Hong merchant , was impending , and Jamsetjee was involved. Jardine could not have his mind rested peacefully unless the message was dispatched at the earliest moment. By the ship Byramgore , Jamsetjee had consigned a large quantity of cotton to the Magniac & Co. , and which was sold to Manhop , but not yet being paid. Although , according to the precedents in Canton's business circle , the amount due to Jamsetjee would eventually be paid up by the rest of the Hong merchants , it would take a long time and with much vexation to recover it. Jardine had taken pride in his acumen in business management. He did not like to see a bad transaction gone through his hand , especially one involving his best friend and business partner for a very long time. But it happened , contrary to his expectation and to that of other experienced China traders , such as John Perkins Cushing , representative of a Boston firm , whose loss was the largest at stake ( something between 300,000 and 400,000 dollars ) . William Jardine wrote to Jamsetjee Jejeebhoy:2 You will be surprised to hear that this circumstance is the failure or expected failure of Manhop , the Hong Merchant , for upwards of a million of Dollars , at a moment when every one , from the Company's Chief Supracargo downwards had the greatest confidence in him , and were lending him money at interest.How can a Hong merchant with all the confidence of the representatives of the British East India Company and the most important non-EIC traders , such as J. P. Cushing and William Jardine , failed almost overnight? It is an interesting matter , which merits an inquiry. The case in itself may also reveal the uncertainty and difficulty in handling business with the Chinese Hong merchants before the Opium War.There were two Manhops , the father and the son. In the following papers , we are mainly to refer to the father , Manhop I , whose formal name is Guan Xiang.Guan Xiang had originally been a clerk or a domestic servant in the house of Ton Anqua , a tea merchant , who sold teas to the East India Company without a Hong license. ( It was not in conformity with the customs and practices of the days , but was countenanced. ) After the death of Ton Anqua ( 1790 ) , Guan Xiang continued to sell three or four "chops" ( lots ) of teas per year to the Company under his late master's name.3 Later on , Guan Xiang opened a shop in Canton , naming it the "Manhop" ( probably a corruptive form of "Wanfu" or Ten Thousand Blessings ) . He was for that sake known to the foreign traders in that appellation. However , to his fellow countrymen , he was generally called , as shown in a letter in the Jardine Matheson Archives , Jioguan ( Kowqua ) .4 During the summer of 1802 , Guan Xiang went into partnership with Deng Zhaoxiang ( Inqua ) , a previous silk merchant , and procured a license from the Hoppo ( the Superintendant of Guangdong Maritime Customs ) to open a Hong. The new Hong was called the Fulong hang ( Fock-long Hong ) .5 Although Inqua was the official representative of the Fulong hang , the Select Committee of the East India Company was in the habit of recording all their transactions with that house under Manhop's name , for their long acquaintance with him.The Fulong hang under Inqua's management did not do well. Under the press of pecuniary demand , Inqua was soon induced by the Baring & Co. ( a private English concern ) to sell opium for them during the several years previous to 1809.6 But even taking upon himself such a risk as to be involved in that illicit trade and hence become liable to heavy punishment if discovered by the authorities , the supposedly lucrative profit derived from his engagement with the Baring & Co. did not suffice to relieve Inqua from all financial embarrassments. In 1810 , when the partners of Ponqua and Gnewqua , another two Hong merchants , fled from their respective Hongs on account of their desperate financial situations , Inqua also made his absconding from the Fulong hang.7 For the time being , it was found that he left a debt of 700,000 taels or so due to his foreign creditors , in addition to the usual arrears of duties and debts owed to his Chinese creditors.8 As Inqua , the representative of the Fulong hang had absconded , Guan Xiang was to be held responsible for the liquidation of the Hong's debts. At that juncture , Guan Xiang was duly persuaded by the Select Committee to stay in Inqua's place and to assume the Hong's debts on himself. He complied only with little reluctance. In fact , it was not just the wishes of the Select Committee to retain Guan Xiang in service , it was also in accord with the Hoppo's intention not to break the Fulong hang. For , at that time , the bankruptcy of Gnewqua's and Ponqua's Hongs was pending , the Hoppo would not like to see another failure. Taking advantage of such a situation , Guan Xiang got the Fulong hang's license reissued , free of any fees. But he chose to have the Hong registered under his son's name , apparently with an intention to save the fees which would accompany another renewal of license upon his death in the future. The license was duly granted to the Guan family towards the end of the 1810-11 season.9 The formal name of Guan Xiang's son was Guan Chengfa. He was commonly known as Fatqua , 10 but the foreign traders preferred to call him Manhop , also. ( To avoid confusion , therefore , he will be mentioned as Manhop II in this paper. ) The management of the Fulong hang , however , devolved upon the father.The Guans then set out the business of the Fulong hang in their own right with a huge debts inherited from previous partnership with Inqua. The debts passed down along with those contracted shortly after 1810-11 were enormous. As they stood in early 1813 , those due to foreign traders , exclusive of the East India Company , were 1,237,681 dollars or 891,130 taels. These debts were placed under the management of three trustees co-opted by his creditors.II. MANHOP'S DEBTS UNDER TRUSTEES' MANAGEMENTEmbarrassed with such a huge debt , Manhop would have gone bankrupt shortly after starting his own business , if it had not happened that there was a general insolvency among the Hong merchants. In 1809 and 1810 , five Hong merchants ( Lyqua , Fonqua , Ponqua , Gnewqua and Inqua ) failed. Those which survived them together with those newly created were ten in number. Among these ten , three only ( viz. , Howqua , Mowqua and Chunqua ) were better solvent , who were called by the Select Committee as the "senior merchants". In contrast , the less solvent or insolvent ones were called the "junior merchants" , disregarding their length in Hong business. Among the junior merchants , the situation of Loqua and Poonequa was most precarious. When the tea merchants were about to return to the tea-producing area and the customary advances on next year's contracts had to be made , these two merchants were entirely unable to find any means to satisfy their obligations. It was only through the assistance of the Select Committee and the senior Hong merchants that they were enabled to effect their contracts. This happened in the spring of 1811 __UNDEF__ ( towards the end of the 1810-11 trade season ) , and recurred in the following one.11 To make it worse , they aved enormous sums to the government and had the responsibility of discharging the debts of the bankrupt Hongs , which were forced upon their shoulders by the government. Many of the junior merchants were unable to meet such deamands by their own means and were obliged to seek for help from the Select Committee. As a result , their deep insolvency was revealed. The Select Committee , in 1812 , made a thorough review of the circumstances of these merchants and came to the conclusion that the Company should uphold them , lest the sharp reduction of the Hong merchants in business should bring about a consolidated association among themselves. Which , in turn , would be detrimental to the Company's interests. They decided to finance the junior merchants by defraying such payments , when demanded , out of the Company's treasury and then deducting these sums from their respective accounts with the Company in the end of each season. The Select Committee in consequence took upon themselves a part of the management of the junior Hongs' finance.12 But the difficulties of the junior Hongs did not end here. They had more troubles. They owed considerable sums to other foreign traders. If they had been pressed for liquidating those debts , they would have failed instantly. Under the auspices of the Select Committee , the "private" ( i.e. , non-EIC ) creditors of the five great debtors , viz. Conseequa , Exchin ( Loqua and Pacqua ) , Manhop , Poonequa and Goqua , finally made up their minds not to break these Hongs. They co-opted among themselves three trustees and counted upon them to recover their claims. They also agreed to stop charging any interest on the debts contracted previous to 1813 by the five merchants in question , and to wait for the gradual liquidation of their claims from the commercial profits of these merchants expected to realize in the years to come. The Select Committee would in the end of each season , from their management of the accounts of the five merchants , issue certain amounts of money to the trustees , to be further distributed in proportion to all the private creditors' individual claims. The Select Committee were enabled to do so , because the Company , as a rule , bought more from and sold less to the Hong merchants; and as a result , always had balances due favorably to the Hong merchants in current season's transactions.13 Manhop's private foreign debts were also under the trustees' management. The Select Committee also managed his account with the Company to help him liquidate the Hong's debts. During the first five years under the Select Committee's and trustees' management , Manhop discharged only 35.2% __UNDEF__ ( 435,664 dollars or 313,678 taels ) of his debts due to private foreigners. Although the percentage did not appear high , the amount discharged was comparable to those executed by Conseequa , Goqua , Exchin and Poonequa , whose private debts were also taken care of by the same arrangement.During these five years , Manhop seemed to have traded extensively with merchants from all corners , and was accused by the Select Committee of trying "to swell the debit side of his account" with them ( the East India Company ) , to slow down the liquidation of his private debts and to divert his funds to the other part of his business.14 After being reprimanded by the Select Committee , he confined his dealings for a few years only to the Company's business.15 His situation remained shaky in the late 1810s. In addition to the payment towards liquidating his debts with private foreigners , the Hong was constantly under the necessity of procuring the assistance of the Select Committee to satisfy government demands , viz. , duties and forced contributions.16 His financial distress also , in some instance , obliged him to appropriate money advanced by the Select Committee ( on tea contracts or other purchases ) to other usage. As a result , he was frequently found unable to fulfill his engagements.17 The prospect of Manhop's clearing up his indebtedness was therefore doubtful. So did it happen. Under the joint management of the trustees and the Select Committee , the junior Hongs' debts were gradually liquidated. Conseequa , Goqua and Poonequa cleared off their accounts by the 1821-22 season or even earlier. When that season drew to an end , the debts remaining to be discharged were those due by Pacqua ( 200,000 dollars ) and Manhop ( 630,000 dollars ) . 18 As Pacqua and Manhop were unlikely by their own efforts to discharge their debts as speedily as the Select Committee deemed desirable , the Committee suggested to the body of Hong merchants that the remaining debts be liquidated by the appropriation of the Consoo Fund ( "hangyong" , a surcharge on the Hong merchants' transactions , supposedly collected by association of the Hong merchants , but in fact reserved in the responsible Hong merchant's own hand ) . The justification is that in case Manhop were declared bankrupt , his debts would after all be forced upon their own hands by the Chinese government. The suggestion was once proposed in the end of the 1818-19 season and again in 1819-20, but it proved unacceptable to some of the Hong merchants.19 The three senior Hong merchants ( Howqua , Mowqua and Chunqua ) , however , consented to manage an extra allotment of the Company's tea purchases on behalf of these two insolvent colleagues , and to make over all the profits to them towards the liquidation of their debts.20 By such an arrangement , the Select Committee hoped the debts would be cleared off in four years in the case of Pacqua , and in six years in that of Manhop.21 What a great relief to Manhop it would be! He could now quietly wait for the discharge of his debts without much ado. But to the surprise of the Canton business circle , he was found , out of his own efforts , able to compound with his creditors by paying half of his arrears in one payment during the season of 1823-24, and consequently cleared off his account. The sum paid up was 310,000 dollars , which was raised in the following manners ( amounts in dollars ) :22 From his relatives and friends. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... ........

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負欠外國債權人的債務常常就高達數十萬兩乃至一、二百萬兩【參考表八】，更不用說他們同時也都拖欠中國政府關稅，積欠中國商人大筆債務了。五、結語由於資金有限與週轉的困難，行商籌措現金的代價十分高昂，遠大於他們的可支配利潤（即商品交易的利潤減去營業設施及行商家族的維持費用，再減去官吏的榨取），因此絕大多數的行商都免不了以破產終結。這種情形當時的中國人也看得很清楚。因此時代越往下走，就越少人肯當行商。十八世紀新任的行商尚有少數是出自自願的，十九世紀的新行商則差不多都是政府強迫為之了。這也說明了為什麼十八世紀的新行商大多原來即已從事中外貿易，而十九世紀的新手則多來自廣州城外的小商人或原先地位很低的通事、買辦之流了。事實上行商除了不易賺錢外，行商個人或其經理人也常常遭受到官吏的人身騷擾。因此不但清白富實的人士不願意充當行商，就是僥倖能賺錢的少數行商也想急流勇退。而行商的子孫更視洋行之業為畏途。相反地，地方官則千方百計地想辦法來羅致稍有貲財的人士來擔任行商，而這些人一旦入其牢籠就設法不讓他們退出。義成行的葉上林可以說是唯一成功退休的例子。同文行的潘致祥雖然在 1807年退休（為此他付出了 500,000 兩銀子的代價），卻在 1815年被迫另外開張了同孚行。當他於 1820年去世時，他的長子潘正亨就設法規避政府的命令，拒絕繼任同孚行行商。潘正亨甚至說：「寧為一隻狗，不為行商之首。」 27 __UNDEF__ 可見得拒絕的意志有多強烈了。可是他的幼弟潘正煒卻逃不了充當行商的命運。行商中最富有的伍秉鑑三番兩次地想要退休，都得不到官府的許可（他雖然在 1826年時以 900,000 元或 900,000 兩的代價將官府註冊的怡和行行商的名字改由他的兒子頂替，政府仍然要他負擔所有行商一切的責任）。他甚至說他願意把十分之八的財產（約 20,000,000 元）捐給政府，只要求政府允許他結束怡和行，安享他所餘下的十分之二的財產（約 6,000,000 元）。 28 __UNDEF__ 他的願望未能實現。鴉片戰爭期間，他的麻煩更多了。而他也已是個七十歲的老人了。他寫信給一位遠在麻薩諸塞州的美國友人 J . P .

Cushing ，說他若不是年紀太大，經不起漂洋過海的折騰，他實在十分想移居美國。 29 __UNDEF__ 看來鼎鼎大名的伍浩官不但對洋行的工作失望了，對整個中國的社會制度也失望了。富有的人不肯當行商，當行商後幸而致富的人也不肯留在他的行業裡，因此政府只有強迫財力更差的人當行商。這些財力不足的人當了行商之後，自然要面對嚴重的週轉壓力。然而當事的政府官員不但沒有協助他們解決財務上的困難，反而無止休地向他們榨取金錢，加深他們的困難。因此，對絕大多數的行商而言，破產根本是必然的，早在他們一當行商的時候就已注定了。唯一的差別是能力稍強的拖得久些，能力差的早早就破產罷了。 ── 原刊於《新史學》，第一卷第四期（ 1990年 12月）， pp. 1-40 。 INTRODUCTIONWhen the "old China trade" was in its heyday , that is , between 1760 and 1843, it was carried on by the Canton Hong merchants , on the Chinese side. The Hong merchants enjoyed exclusive privilege of trading with Western traders who chose to come to China. Supposedly they should have made a good fortune from such a monopoly. But to the contrary of general expectation , many of them went bankrupt. There were common reasons behind this phenomenon , which I have dealt with , treating them as a group , in my dissertation entitled The Insolvency of the Chinese Hong Merchants , 1760-1843.1 In that dissertation , I mean to say , the business of the Hong merchants was undoubtedly profitable , and their expenses and charges could be covered by their profits , if sufficient capital were provided with. Unfortunately , it was not the case. The want of capital and the dearth of cash in Canton market frequently drew the Hong merchants into financial straits , and they were in consequence subject to exorbitant interest rates or other detrimental methods to raise funds for financing their dealings. Manhop's failure was not an exception to such a pattern , but it was more episodical and more complicated than others'. This paper means to reconstruct the story of Manhop's failure as a case study and to point out some deplorable methods that were adopted by the Hong merchants in their business management.I. MANHOP STARTED HIS BUSINESS WITH HEAVY DEBTSIt was about two o'clock A. M. on the 4th day of February , 1828. William Jardine , senior partner of the Magniac & Co. at Canton , has been staying late for writing a letter to his Parsi friend and business correspondent , Jamsetjee Jejeebhoy of Bombay. He could not postpone the writing till morning , partly because the ship Jamesina was about to set sail for Bombay , but mostly because the failure of Manhop , the Hong merchant , was impending , and Jamsetjee was involved. Jardine could not have his mind rested peacefully unless the message was dispatched at the earliest moment. By the ship Byramgore , Jamsetjee had consigned a large quantity of cotton to the Magniac & Co. , and which was sold to Manhop , but not yet being paid. Although , according to the precedents in Canton's business circle , the amount due to Jamsetjee would eventually be paid up by the rest of the Hong merchants , it would take a long time and with much vexation to recover it. Jardine had taken pride in his acumen in business management. He did not like to see a bad transaction gone through his hand , especially one involving his best friend and business partner for a very long time. But it happened , contrary to his expectation and to that of other experienced China traders , such as John Perkins Cushing , representative of a Boston firm , whose loss was the largest at stake ( something between 300,000 and 400,000 dollars ) . William Jardine wrote to Jamsetjee Jejeebhoy:2 You will be surprised to hear that this circumstance is the failure or expected failure of Manhop , the Hong Merchant , for upwards of a million of Dollars , at a moment when every one , from the Company's Chief Supracargo downwards had the greatest confidence in him , and were lending him money at interest.How can a Hong merchant with all the confidence of the representatives of the British East India Company and the most important non-EIC traders , such as J. P. Cushing and William Jardine , failed almost overnight? It is an interesting matter , which merits an inquiry. The case in itself may also reveal the uncertainty and difficulty in handling business with the Chinese Hong merchants before the Opium War.There were two Manhops , the father and the son. In the following papers , we are mainly to refer to the father , Manhop I , whose formal name is Guan Xiang.Guan Xiang had originally been a clerk or a domestic servant in the house of Ton Anqua , a tea merchant , who sold teas to the East India Company without a Hong license. ( It was not in conformity with the customs and practices of the days , but was countenanced. ) After the death of Ton Anqua ( 1790 ) , Guan Xiang continued to sell three or four "chops" ( lots ) of teas per year to the Company under his late master's name.3 Later on , Guan Xiang opened a shop in Canton , naming it the "Manhop" ( probably a corruptive form of "Wanfu" or Ten Thousand Blessings ) . He was for that sake known to the foreign traders in that appellation. However , to his fellow countrymen , he was generally called , as shown in a letter in the Jardine Matheson Archives , Jioguan ( Kowqua ) .4 During the summer of 1802 , Guan Xiang went into partnership with Deng Zhaoxiang ( Inqua ) , a previous silk merchant , and procured a license from the Hoppo ( the Superintendant of Guangdong Maritime Customs ) to open a Hong. The new Hong was called the Fulong hang ( Fock-long Hong ) .5 Although Inqua was the official representative of the Fulong hang , the Select Committee of the East India Company was in the habit of recording all their transactions with that house under Manhop's name , for their long acquaintance with him.The Fulong hang under Inqua's management did not do well. Under the press of pecuniary demand , Inqua was soon induced by the Baring & Co. ( a private English concern ) to sell opium for them during the several years previous to 1809.6 But even taking upon himself such a risk as to be involved in that illicit trade and hence become liable to heavy punishment if discovered by the authorities , the supposedly lucrative profit derived from his engagement with the Baring & Co. did not suffice to relieve Inqua from all financial embarrassments. In 1810 , when the partners of Ponqua and Gnewqua , another two Hong merchants , fled from their respective Hongs on account of their desperate financial situations , Inqua also made his absconding from the Fulong hang.7 For the time being , it was found that he left a debt of 700,000 taels or so due to his foreign creditors , in addition to the usual arrears of duties and debts owed to his Chinese creditors.8 As Inqua , the representative of the Fulong hang had absconded , Guan Xiang was to be held responsible for the liquidation of the Hong's debts. At that juncture , Guan Xiang was duly persuaded by the Select Committee to stay in Inqua's place and to assume the Hong's debts on himself. He complied only with little reluctance. In fact , it was not just the wishes of the Select Committee to retain Guan Xiang in service , it was also in accord with the Hoppo's intention not to break the Fulong hang. For , at that time , the bankruptcy of Gnewqua's and Ponqua's Hongs was pending , the Hoppo would not like to see another failure. Taking advantage of such a situation , Guan Xiang got the Fulong hang's license reissued , free of any fees. But he chose to have the Hong registered under his son's name , apparently with an intention to save the fees which would accompany another renewal of license upon his death in the future. The license was duly granted to the Guan family towards the end of the 1810-11 season.9 The formal name of Guan Xiang's son was Guan Chengfa. He was commonly known as Fatqua , 10 but the foreign traders preferred to call him Manhop , also. ( To avoid confusion , therefore , he will be mentioned as Manhop II in this paper. ) The management of the Fulong hang , however , devolved upon the father.The Guans then set out the business of the Fulong hang in their own right with a huge debts inherited from previous partnership with Inqua. The debts passed down along with those contracted shortly after 1810-11 were enormous. As they stood in early 1813 , those due to foreign traders , exclusive of the East India Company , were 1,237,681 dollars or 891,130 taels. These debts were placed under the management of three trustees co-opted by his creditors.II. MANHOP'S DEBTS UNDER TRUSTEES' MANAGEMENTEmbarrassed with such a huge debt , Manhop would have gone bankrupt shortly after starting his own business , if it had not happened that there was a general insolvency among the Hong merchants. In 1809 and 1810 , five Hong merchants ( Lyqua , Fonqua , Ponqua , Gnewqua and Inqua ) failed. Those which survived them together with those newly created were ten in number. Among these ten , three only ( viz. , Howqua , Mowqua and Chunqua ) were better solvent , who were called by the Select Committee as the "senior merchants". In contrast , the less solvent or insolvent ones were called the "junior merchants" , disregarding their length in Hong business. Among the junior merchants , the situation of Loqua and Poonequa was most precarious. When the tea merchants were about to return to the tea-producing area and the customary advances on next year's contracts had to be made , these two merchants were entirely unable to find any means to satisfy their obligations. It was only through the assistance of the Select Committee and the senior Hong merchants that they were enabled to effect their contracts. This happened in the spring of 1811 __UNDEF__ ( towards the end of the 1810-11 trade season ) , and recurred in the following one.11 To make it worse , they aved enormous sums to the government and had the responsibility of discharging the debts of the bankrupt Hongs , which were forced upon their shoulders by the government. Many of the junior merchants were unable to meet such deamands by their own means and were obliged to seek for help from the Select Committee. As a result , their deep insolvency was revealed. The Select Committee , in 1812 , made a thorough review of the circumstances of these merchants and came to the conclusion that the Company should uphold them , lest the sharp reduction of the Hong merchants in business should bring about a consolidated association among themselves. Which , in turn , would be detrimental to the Company's interests. They decided to finance the junior merchants by defraying such payments , when demanded , out of the Company's treasury and then deducting these sums from their respective accounts with the Company in the end of each season. The Select Committee in consequence took upon themselves a part of the management of the junior Hongs' finance.12 But the difficulties of the junior Hongs did not end here. They had more troubles. They owed considerable sums to other foreign traders. If they had been pressed for liquidating those debts , they would have failed instantly. Under the auspices of the Select Committee , the "private" ( i.e. , non-EIC ) creditors of the five great debtors , viz. Conseequa , Exchin ( Loqua and Pacqua ) , Manhop , Poonequa and Goqua , finally made up their minds not to break these Hongs. They co-opted among themselves three trustees and counted upon them to recover their claims. They also agreed to stop charging any interest on the debts contracted previous to 1813 by the five merchants in question , and to wait for the gradual liquidation of their claims from the commercial profits of these merchants expected to realize in the years to come. The Select Committee would in the end of each season , from their management of the accounts of the five merchants , issue certain amounts of money to the trustees , to be further distributed in proportion to all the private creditors' individual claims. The Select Committee were enabled to do so , because the Company , as a rule , bought more from and sold less to the Hong merchants; and as a result , always had balances due favorably to the Hong merchants in current season's transactions.13 Manhop's private foreign debts were also under the trustees' management. The Select Committee also managed his account with the Company to help him liquidate the Hong's debts. During the first five years under the Select Committee's and trustees' management , Manhop discharged only 35.2% __UNDEF__ ( 435,664 dollars or 313,678 taels ) of his debts due to private foreigners. Although the percentage did not appear high , the amount discharged was comparable to those executed by Conseequa , Goqua , Exchin and Poonequa , whose private debts were also taken care of by the same arrangement.During these five years , Manhop seemed to have traded extensively with merchants from all corners , and was accused by the Select Committee of trying "to swell the debit side of his account" with them ( the East India Company ) , to slow down the liquidation of his private debts and to divert his funds to the other part of his business.14 After being reprimanded by the Select Committee , he confined his dealings for a few years only to the Company's business.15 His situation remained shaky in the late 1810s. In addition to the payment towards liquidating his debts with private foreigners , the Hong was constantly under the necessity of procuring the assistance of the Select Committee to satisfy government demands , viz. , duties and forced contributions.16 His financial distress also , in some instance , obliged him to appropriate money advanced by the Select Committee ( on tea contracts or other purchases ) to other usage. As a result , he was frequently found unable to fulfill his engagements.17 The prospect of Manhop's clearing up his indebtedness was therefore doubtful. So did it happen. Under the joint management of the trustees and the Select Committee , the junior Hongs' debts were gradually liquidated. Conseequa , Goqua and Poonequa cleared off their accounts by the 1821-22 season or even earlier. When that season drew to an end , the debts remaining to be discharged were those due by Pacqua ( 200,000 dollars ) and Manhop ( 630,000 dollars ) .

18 As Pacqua and Manhop were unlikely by their own efforts to discharge their debts as speedily as the Select Committee deemed desirable , the Committee suggested to the body of Hong merchants that the remaining debts be liquidated by the appropriation of the Consoo Fund ( "hangyong" , a surcharge on the Hong merchants' transactions , supposedly collected by association of the Hong merchants , but in fact reserved in the responsible Hong merchant's own hand ) . The justification is that in case Manhop were declared bankrupt , his debts would after all be forced upon their own hands by the Chinese government. The suggestion was once proposed in the end of the 1818-19 season and again in 1819-20, but it proved unacceptable to some of the Hong merchants.19 The three senior Hong merchants ( Howqua , Mowqua and Chunqua ) , however , consented to manage an extra allotment of the Company's tea purchases on behalf of these two insolvent colleagues , and to make over all the profits to them towards the liquidation of their debts.20 By such an arrangement , the Select Committee hoped the debts would be cleared off in four years in the case of Pacqua , and in six years in that of Manhop.21 What a great relief to Manhop it would be! He could now quietly wait for the discharge of his debts without much ado. But to the surprise of the Canton business circle , he was found , out of his own efforts , able to compound with his creditors by paying half of his arrears in one payment during the season of 1823-24, and consequently cleared off his account. The sum paid up was 310,000 dollars , which was raised in the following manners ( amounts in dollars ) :22 From his relatives and friends. .

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