IX. Japan and the First World War

The World War gave Japan her great opportunity, which her leaders were quick to seize. The conditions created by World War No. 1 might have been made to order for Japan. They brought all her strategic advantages into play, and were ideally adapted to meet her economic necessities.

Japan was not compelled to fight a full-dress war. The Western powers were more than occupied on the European battlefields, so Japan was given pretty much of a free hand in the Far East. And the line-up of powers in 1914-18 added greatly to the strategic advantage of her geographic location. Britain and Russia were Japan’s allies from the outset, while the United States could not offer firm opposition to Japanese expansion. Thus Japan was able to achieve a great deal with very little effort.

Conditions on the economic side were no less favorable. As Japan’s military and naval operations during the war were relatively slight, the costs were small. On the other hand, her economic gains were exceedingly large. For next to the United States, Japan was the greatest supplier of the warring nations.

MAKING HAY WHILE THE SUN SHINES

It was the Anglo-Japanese Alliance, renewed for the third time in 1911, which gave Japan formal diplomatic cause for entering the war. On August 23, 1914 she declared war on Germany.

After a brief struggle, the German forces at the leasehold of Tsingtao, in Shantung province, surrendered on November 7. A month later the whole of Shantung province was in Japanese hands. Then followed the famous Twenty-One Demands on China. On May 25, 1915, at the point of a gun, China signed treaties and notes incorporating many of these Twenty-One Demands. Among other things these treaties confirmed Japan’s newly won position in Shantung province, and extended her railway and territorial rights in South Manchuria to the end of the century. American protests helped to block the most sweeping demands, which would have made China a Japanese protectorate. Meanwhile the Japanese navy had scoured the Pacific, and had occupied all the German islands north of the equator.

THE SECRET TREATIES OF 1917

During the early months of 1917, Japan turned to diplomacy in order to be sure that she would be able to keep her territorial gains after the war. The United States had not yet entered the war, and the military fortunes of the Allied powers in Europe were at a low ebb. Making good use of this situation, Japan negotiated secret treaties with Britain, France, Russia and Italy. Signed in February and March 1917, these agreements pledged that Japan’s claims to the German islands north of the equator and to the former German rights in Shantung would be supported at the peace conference. But the Japanese did not secure American support of these claims. In the Lansing-Ishii agreement of November 2, 1917, the United States offered merely a qualified recognition of Japan’s “special interests in China.”

The secret treaties with the Allied powers were shrewdly drawn and enabled Japan to come off victorious at the Paris Peace Conference. Her newly established position in Shantung province, as well as the extensions of her rights in South Manchuria, were accepted and written into the Versailles Treaty. The German islands north of the equator were awarded Japan as a Class C mandate, the kind of mandate which came closest to annexation. American opposition to these decisions cut no ice, mainly because of Japan’s secret agreements with the Allies. On only one big issue was Japan defeated at the conference. Her statesmen had demanded that a clause on racial equality be inserted in the peace treaty. This demand was rejected, largely because the Western powers were afraid that it would let down the bars against Japanese immigration to their countries.

FLIES IN THE OINTMENT

But despite the acceptance of her territorial gains at the peace conference, by 1919 Japan’s difficulties were increasing. A student uprising in Peking drove out the pro-Japanese Anfu clique that had controlled the Chinese government. Opposition to the Shantung award was growing in the United States, and the American navy was rapidly becoming the most powerful in the world. Two years later Japan’s position had become still weaker. A boycott was severely reducing Japanese trade in China. The costs of the naval-building race with the United States were a heavy burden. Japanese intervention in Siberia, which continued after the armed forces of the Western powers had been withdrawn, was not succeeding. And expenditure on the Siberian occupation, ultimately totaling about 800 million yen, together with the naval-building costs, was straining the Japanese budget. These various factors were discrediting the Japanese militarists at home, and liberal Japanese were beginning to speak out against them.

SLOWING DOWN JAPAN’S DRIVE

Under these conditions, the United States was able to summon the Washington Conference, at which important agreements on naval limitation and Pacific questions were reached early in 1922. By accepting a battleship ratio of 3 tons as against 5 each for Britain and the United States, Japan was relieved of the costs of the naval race. Her security in Far Eastern waters was further increased by the provision restricting fortification of island bases in the Pacific. The Four-Power Pact, signed by Britain, France, the U. S. and Japan, and pledging respect for insular possessions in the Pacific, replaced the Anglo-Japanese Alliance.

In return for these contributions to her security in Far Eastern waters, Japan made a number of important concessions. By an agreement with China, she restored Shantung province to Chinese control. Japan also signed the Nine-Power Treaty, which pledged all its signatories to respect China’s territorial and administrative integrity and the “open door”—or equal commercial opportunity for all nations—in China.

In later days, some of the provisions of these Washington Conference agreements came to be bitterly attacked in Japan, especially by military and naval extremists. It is an open question as to how far these criticisms were justified. It was chiefly the effectiveness of the Chinese boycott that forced the restoration of Shantung province. Japan’s major concession was in the Nine-Power Treaty, by which she agreed to lay down the sword and accept the results of peaceful commercial competition in China. But there was no machinery provided to enforce this treaty. The naval limitation treaty relieved Japan of the heavy costs of the 1921 naval race and at the same time, even under the 5-5-3 ratio, left her able to dominate the China coast. She was thus in a strategic position to renew her expansionist program—which she did in 1931.

WORLD WAR GAINS

Moreover, the World War settlement for Japan, as finally reached at Washington, was no empty achievement. Japan had not obtained her larger ambitions in China or Siberia, it is true. But the former German islands north of the equator—of great strategic, if not economic, importance—were now a Japanese mandate. Japan’s rights in South Manchuria had become much more firmly established. Her naval and commercial fleets had greatly expanded, she occupied a permanent seat on the Council of the League of Nations, and she was recognized as one of the half-dozen Great Powers. Japan had also made important economic gains, to which we must now turn our attention.

THE WAR BOOM

It was in the economic field, perhaps, that Japan reaped her greatest gains from the World War. For her shops and factories were kept busy supplying the belligerent countries, their colonial populations, and the American market. Her allies controlled the seas, and Japanese ships sailed all of them. This freedom of the seas was an important factor for Japan, who had become increasingly dependent on international trade.

Japan’s war boom was, in many respects, very similar to that enjoyed by the United States. The relative increase in trade was even greater. Between 1914 and 1920 Japan’s total foreign trade increased from 1,187 million yen to 4,285 million, or by nearly four times (see chart, page 61). Through 1918, moreover, exports increased much faster than imports. For Japan this meant a chance to stock up on her reserves of gold and foreign currencies, which had always been low. In the 1914-18 period, exports outran imports by 1,460 million yen. This figure contrasted with an import excess of 1,158 million yen during the preceding 20 years.

What we have said so far applies only to trade in goods. But returns on invisible trade items, such as shipping services, were also high—totaling more than 1,500 million yen for the 1914-18 period. The wartime balances for both types of trade came to more than 3,000 million yen—on the right side of the ledger. As a result, Japan’s financial reserves greatly increased. Extensive loans and investments were made in foreign countries, and large holdings in gold and foreign exchange were piled up.

Japan emerged from the war stronger financially and economically than she had ever been before. Nevertheless, she was to suffer a series of economic setbacks in the post-war period.