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The Teppo Festival, in Japan. Photo: AFP

How Hong Kong has profited from the arms trade

Jason Wordie

LIFE

Entrepôt trade, from which beginnings Hong Kong evolved, involves, at base, the import and re-export of various commodities, with profit generated on the transaction, transport, brokerage and whatever other fees and charges (either above or below the counter) that can be extracted from both seller and buyer.

Intermediaries were required for these deals, and that quintessential China coast mercantile species – the comprador – evolved from 18th-century Canton trade beginnings for exactly that purpose.

Compradors seldom inquired too deeply about the morality of the goods in question; whether it was tobacco, sugar, opium, ivory, weapons or munitions, if the commodity met the (often deliberately loose) local definition of “legal”, and a reasonable commission could be earned, then that was all that mattered.

Ethics play little or no part in the way Hong Kong business conducts itself – and never have done.

Businessman Tsui Tsin-tong. Photo: SCMP
Arms dealers, munitions brokers and other conflict profiteers have been a persistent, if by nature shadowy, feature of China coast business life for centuries.

As far back as the early 17th century, Portuguese Macau manufactured and supplied weapons (and mercenaries, periodically) to various intra-Asian conflicts.

Siamese-Burmese wars, in particular, were enabled by Portuguese weaponry. Firearms were introduced into Japan by the Portuguese, at Tanegashima in the mid-1500s; the decennial Teppo Festival commemorates this momentous event.

Export weapons were produced at a foundry at the southern end of Macau’s Praia Grande, known as Chunambeiro. It also produced church bells; Roman Catholicism was another tumultuous, often violent import into Japan, as well as other parts of maritime Asia.

Catholicism eventually created so much social upheaval that the Tokugawa shogunate, then in power, proscribed it as an evil cult and viciously suppressed its practitioners – much as mainland China deals with the Falun Gong and other real (or imagined) threats to social order today.

Various “old money” Hong Kong fortunes owe their establishment – and, according to local whispers, continued prosperity – to shadowy arms trafficking. One of history’s great ironies is that during the early phases of the Sino-Japanese war, the Nationalist government got most of its military hardware from Nazi Germany and fascist Italy – close allies of Japan – while the Western powers (Britain, the United States, the Netherlands, Australia and others) were, despite official support for China, major suppliers of raw materials to the Japanese war machine, in particular oil, scrap iron and other minerals.

War – and the multi-layered profits it generates – makes for some strange bedfellows.

Italian bullion broker P.G.

Calcina, renowned across the Far East for his involvement in the post-war Macau gold trade, started his China career in Shanghai in the late 1930s as a broker for aircraft and other armament sales from Italy to the Nationalist government.

Trading/smuggling networks in and out of China established in the early 1940s worked just as well a decade later, when the United Nations embargo on mainland trade almost crippled the national economy. Pharmaceuticals, rubber, oil products and other scarce materials found their way into China through “patriotic” Hong Kongbased smuggling networks, and mainland-made weapons (which helped fund the import of these materials) went out the other way.

Calcina moved to Hong Kong after the war, and lived peacefully until his death in the Repulse Bay Hotel with his north China-born mistress who, into her advanced old age, remained the personal secretary to another legendary Hong Kong tycoon.

 

This article appeared in the South China Morning Post print edition as: Making a killing
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