Fourthly, the Japanese copper exported to make up for this shortage came to be used as a means of exchange in trade not only in China but also in Asia as a whole. Fifthly, demand for Japanese copper extended even beyond Asia, influencing the European copper market. (However, most of the demand was in Asia and only a small quantity made its way to Europe.)
Apart from Japan, the main areas of copper production in Asia were China, Persia and India, but in all of them the yield was insufficient, making Edo Japan the world_s largest supplier of copper. Before the Edo period, the Japanese economy could not operate without Chinese copper, but from this period onwards the whole Asian economy could not do without Japanese copper. By gaining complete control over the material used for domestic currency and then through its export, Edo Japan acquired the status of a nation that could influence the economy of China and the rest of Asia and, through Holland, the world economy. This means that Japan had succeeded in attaining the same status as China, which had once held a monopoly on the supply of copper coins. The Japanese economic bloc had a emerged with a vigor that exceeded even that of its Chinese counterpart.
Japan_s Role as a Supplier of Silver
If copper was the basic currency of the East Asian economic bloc, silver was the world currency. As a result of the large flow of copper coins out of China from the Song dynasty, the copper supply began to dry up and silver began to be used for money together with copper from the Ming dynasty onwards. The sources of this sliver were Europe and Japan. Let us first examine the case of Europe.
The colonization of the New World by the Europeans began around 1500, but during this first century the demand in Europe from the new continent was almost entirely for gold and silver. The gold and silver that flowed rapidly into Europe from the New World caused inflation referred to as the _price revolution_ in world history. In Spain, the gold and silver were consumed as war expenses and failed to stimulate economic growth. Britain, on the other hand, succeeded in achieving sustained economic growth by investing this gold and silver. By developing industry, particularly the wool industry, more rapidly than any other European nation, Britain established the foundations for the procurement of gold and silver.
However, the gold and silver of the New World were not used only for Britain_s economic development. In the seventeenth century, European countries such as Britain, Holland, Belgium and Denmark together established the East India Company and carried this gold and silver, particularly silver, to _East India,_ i.e. Asia. Just as Europe wanted little other than gold and silver from the New World, Asia wanted little other than silver from Europe. Among the Asian countries, China and India in particular required huge amounts of silver from Europe. They had various attractive commodities to offer in return. In India, there was _Dhaka muslin,_ a fine silk fabric made in the Bengal region said to be as soft as the wings of a cicada. China had silk that the Europeans had coveted since Roman times, high-quality china on which even a knife could not leave a mark, and the tea to be drunk from china cups. And in Southeast Asia, where the civilizations of India and China met, there were pepper and spices. The Europeans were intoxicated by the lure of these goods from the ancient Asian continental civilizations and paid for them in silver.
The silver that flowed into China from Europe came by two routes: it was either taken to Europe over the Atlantic Ocean, then by ships of the East India Company via the Cape of Good Hope or the Indian Ocean to Malacca and Batavia (Jakarta), or it was carried in Spanish galleons to Acapulco in Mexico and thence over the Pacific Ocean to Manila. The city of Manila was built by the Spanish in 1571. They brought silver coins to Manila, purchased Chinese raw silk thread, silk fabrics, and china with it, and then returned in their galleons over the Pacific Ocean. According to the Spaniard Antonio de Molga??, writing in the sixteenth century, _The Chinese merchants just purchased silver coins; they showed no interest in any other goods from the New World, even gold bullion._