Page 209 - Merchants and Mandarins China Trade Era

195.

In 1829 the Company had to cope with the problem of an

increasing number of insolvent Hong merchants. By 1829 only

three Hong merchants (Houqua, Pwankhequa and Gouqua) were not

either deeply in debt or bankrupt. Since the Company spread

its business across all the Hongs, their financial state was

an important matter of concern to the Select Committee. It
followed the usual course and petitioned the governor-general

to correct the situation, namely to appoint new Hong merchants

to supplement those in financial difficulty. The Committee also

decided that an opportunity now existed because of the Hoppo's

death, to petition for some changes in Chinese commercial

regulations. These included the abolition or mitigation of

the Cumshaw duty and an extension of the privilege of trading

with the Outside merchants. The private British merchants and

the Indian Parsee merchants addressed similar memorials to the

governor-general in support of the Company. Fortified by such

support, the Company expanded its demands to include the dim­

inution of all port duties, the abolition of the security

function of the Hong merchants, and the relaxation of the Co­

hong's shared liability for Hong debts. To give force to their

demands, the Company kept all English vessels away from Whampoa

78
and thereby embargoed English trade at Canton.
Governor-general Li was not receptive to the Company's

petitions. But after several communications, the governor­

general relented on the major problem of insolvent Hong mer-

78
Morse, Chronicles of the East India Company, IV, 199-205.