10 The Emergence of the Japanese Economic Bloc
The Elimination of Imported Currency at the End of the Seventeenth Century
After the collapse of the Soviet Union, it was divided into a dozen or so republics. One of the first things these republics did was to establish central banks and issue their own currency. The possession of its own currency is proof of a country_s independence.
Until the Edo period, Japan depended on copper coins imported from China for its currency. Since it used money minted in China, can pre-Edo Japan be described as an independent country? If, for example, American dollars could be used as currency in present-day Japan, Japan could not be called an independent nation. During the American Occupation after World War II, GHQ requested that the American dollar be recognized as valid currency in Japan, but the Japanese authorities flatly refused because this would have effectively turned Japan into another state of America. Similarly, we need to have reservations about recognizing Japan_s national independence while it depended on Chinese currency. Taira no Kiyomori (1118_81) tried to transfer the capital of Japan to Fukuhara in the late Heian period and Ashikaga Yoshimitsu (1358_1408) paid tribute to the Chinese court through vassal homage for the same reason: they needed currency from the Song (960_1279) and Ming (1368_1644) dynasties, respectively. Since Song and Ming coins passed as currency in Japan, Japan was part of the Chinese economic bloc.
Japan was not originally part of China. In order to avoid this fate, the Japanese had given their country its name, set up the emperor system and enacted national laws within less than half a century after they were defeated by the Chinese in the Battle of Hakusukinoe on the coast of the Korean peninsula in 663. Following the example of the city of Chang_an, the Japanese built Fukuharaky_and Heij_y_using the grid-patterned J_i system, and, following the compilation methods used in the official history of China (authorized by the emperor), they drew up the Nihon shoki (Chronicle of Japan). The Japanese thus established a state comparable to China and fostered a national culture: Japan had become an independent country, both politically and culturally.
Another aspect of this drive towards independence was the minting of the wad_kaichin, the twelve coinages of the imperial court of Japan. Here too, the newly formed Japanese nation followed the example of the copper coins that had been used in China from the Hah dynasty (202 b.c. _a.d. 220). However, the Japanese people, unaccustomed to the use of money, hoarded these copper coins and continued to barter using goods such as cloth or rice. With the development of a commodity economy, Japan_s rulers m devoted their energies to obtaining Chinese currency rather than minting their own, as if they themselves wanted Japan to be incorporated into the Chinese economic bloc. Since the Japanese statesmen had no compunction in using Chinese currency, Japan during this period can only be described as a semi-independent country.
The situation changed completely in the Edo period (1603_1868). The Tokugawa shogunate minted gold, silver and copper coins and by the end of the seventeenth century imported currency had been almost entirely removed from Japan. This was an epoch-making development in Japan_s economic history. Firstly, it meant that Japan had achieved economic independence from China. Secondly, and very significantly, Japan became the only country in the world that was domestically self-sufficient in and had complete control over the gold, silver and copper needed for minting money. None of the countries of Europe was able to procure all these materials by themselves. Thirdly, due to the shortage of copper in China that arose during the Ming dynasty (1368_1644) and became more serious in the Ch_ing dynasty (1644_1912), China became increasingly dependent on Japanese copper, on which it had to rely almost completely during the first quarter of the eighteenth century.
