War on Drugs

The city of Shanghai originally developed because of a war on drugs.

Prior to 1832 foreign trade with China was very restricted. The Chinese only allowed foreign ships into one port, Canton, and entry was very regulated. After stopping in Macau to pick up a Chinese pilot and written permission to enter Chinese waters, all ships proceeded to anchor at Whampoa, an island 13 miles south of Canton. Hundreds of boats would be at anchor, loading and unloading cargo, which would then be taken on smaller boats to the warehouses in Canton. Sailors with rare exception were confined to the ships. Those officers who were allowed to Canton, were restricted to certain parts of town. No firearms were permitted to be carried by foreigners in the city and foreign women were forbidden from entry. Back in the Whampoa harbour, where the sailors were stuck on their ships, brightly decorated Chinese Flower Boats traveled the waters carrying Chinese ladies of pleasure, some with musicians playing Chinese music.

However, the foreigners were not happy with all the restrictions. While they were very keen to get the silks, spices, tea, cotton and ceramics in great demand back home, the Chinese were not particularly interested in what the foreigners had to offer. This frustrated the foreigners as silver flowed into China and balance of payments were, well, unbalanced.


The British came up with the bright idea of drug dealing. Something addictive, so the Chinese would come back for more. Both the British and the Americans started bringing in opium from India and Turkey, which was much better than the Chinese home grown. Opium was illegal in China and had been since the 1790's but by the 1830's, the foreigners were bringing in 1400 tons a year. When the Chinese government, concerned about the huge number of addicts among their people, tried to shut down the opium trade, seizing and burning 20,000 chests of opium owned by the East India Company, the British went to war over it for two years, to keep the right to bring the drugs into the country.

Eventually the Chinese were defeated by the British and The Treaty of Nanking was signed in 1842, opening key ports, including Shanghai to foreign trade. The United States and France were close behind, negotiating their own treaties and by 1849, Shanghai was divided into districts each with its own administration. Thus was formed the International Concession, settled and governed by the British and Americans and the French Concession governed by the French. These areas of Shanghai were occupied by foreigners for the next 90 years.

The second half of the 19th century saw the rapid growth of a new city, incorporating foreign influence and money. Shanghai flourished.