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Chinese Overseas Remittances to China: The Perspective from Southeast Asia

2012; Routledge; Volume: 43; Issue: 1 Linguagem: Inglês

10.1080/00472336.2012.735918

1752-7554

Cheong Kee Cheok, Lee Kam Hing, Poh Ping Lee,

Philippine History and Culture

Abstract Remittances of Chinese overseas during the decades before and just after the Second World War formed an important part of China's economy and were a significant feature of Southeast Asia's economic history. Familial and ethnic sentiments drove this impulse to send money back to China. In reviewing evidence for Malaya and Singapore, this paper is a new study on the nature, the role and the mechanisms of transmission of these remittances. In charting the ebb and flow of remittances during the period, this study examines several factors responsible for the subsequent decline of these flows. These are political changes, both in China and Southeast Asia, the policies and regulations of the British colonial administration, and generational change. Key Words: RemittancesChinese overseasbankingfamily supportdisaster relief Notes Following Wang (Citation1993), we refer to this population as “Chinese overseas,” although the term in common use had been “overseas Chinese.” Interestingly, for the period that is the focus of this paper, the latter term had greater applicability than it does now. Not surprisingly, enterprises established by members of this group during this period, such as the Overseas-Chinese Banking Corporation headquartered in Singapore, have used this terminology. Separate administrations were in place in Malaya and Singapore, with the latter being part of the Straits Settlements, hence the references made to “governments” and to “Straits” in subsequent parts of this paper. One source estimates, for example, that the Chinese in Malaya led in wartime donations to China (Straits Times, May 1, 1939). This paper uses the pinyin system of romanisation of Chinese terms. However, the system of romanization prevalent during the period under discussion is used for dialect groups, e.g. Canton (Guangdong), Hokkien (Fujian), Teochew (Chaozhou) and Hakka (Kejia), and place names, e.g. Amoy (Xiamen) and Swatow (Shantou). The current names of places in China are included within parentheses next to these old names. Names of Chinese overseas persons are spelt exactly as they were referred to in English in their places of residence. Unless otherwise stated, “$” refers to the Straits dollar. It was the currency of the Straits Settlements and also for the Federated and Unfederated Malay States in Malaya (Peninsular Malaysia) from 1904 to the outbreak of the Second World War. Its exchange rate was fixed at $1 = 2s. 4d. sterling (Lee Citation1990, 13). The Chinese overseas in Malaya were reported to be the largest contributors of relief funds (Singapore Free Press and Merchandising Advertiser, May 14, 1941). The same article stated that there were 649 centres for collecting relief funds from Chinese overseas. For instance, reports of remittances from Singapore appeared in the Singapore Free Press and Merchandising Advertiser or the Straits Times on September 8 and 22, 1937, and March 9 and October 20, 1939, from Negri Sembilan Chinese overseas on September 24, 1937, on January 7 and September 7, 1938, Malacca in November 28, 1937, and for Malaya as a whole on December 16, 1937, April 2 and May 1, 1939. An item in the Straits Times of May 1, 1939 was titled “Malaya leads in wartime donations to China,” and reported: “Besides making important monetary contributions, thousands upon thousands of overseas Chinese, from professional men to manual workers, have returned to China to offer their services.” The term “pi” () referred to both money () and letters (). Letters to remitters' kin often accompanied the transmission of money. For this reason, remittance houses were sometimes referred to as xin ju () (Sin Chew Jit Po (), May 15, 1939). Details about runners and remittances houses in Malaya were given in an interview with Mr John Chan, whose family owned and operated a grocery store (Yik Tai) which also acted as a remittance house in Kuala Lumpur up until the 1950s. The authors are grateful to him for his first-hand account of remittance arrangements at the places of origin of the remittances. This duration of time, about four months, was needed for the runner to make the round-trip as well as remain long enough to collect a sufficient amount of money and goods to make his trip financially worthwhile. The Singapore-based Nanyang () Chinese Exchange and Remittance Association, in its 1948 Annual Report, had 159 registered Singapore members and 7 members outside Singapore (NCERA 1948). It is likely that some remittance houses were not registered. “Clubbed packets” refer to bundles of letters sent by remittance shops in Malaya through the Post Office to China for delivery to the individual addresses. A licence to use this service had to be obtained from the postal authorities. The “club packets” were registered. In the discourse on Chinese overseas banks in Malaya and Singapore, their role has been typically characterized as having “stimulated Chinese business activities, smoothed commercial transactions, consolidated the financial position of Chinese businessmen, and promoted export activities …” (Yen 2008, 42). Lee (Citation1990, 39) only mentioned “foreign exchange arbitrage” in relation to the role played by the Ho Hong Bank in facilitating the onward transmission of Chinese overseas remittances to China. China had been on the silver standard, and the fall in the price of silver early in the years of the Great Depression effectively meant its currency had depreciated against the currencies of the British colonies, which, like Britain, were on the gold standard. Whether such expropriation did take place on a sufficient scale is hard to tell. A Singapore Free Press (July 13, 1953) news item, “Red China spares Malayan money,” quoted the Remittance Agents Association as denying that this occurred on a large scale. These measures adversely affected not only remittance houses' profitability but also their competitiveness. Profitability was reduced because they were no longer able to use black markets which gave more favourable rates than banks for currency exchange. This increased cost of currency exchange, which had to be passed on to their clients, reduced their competitive edge against banks.