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THE treaty of Nanking was concluded in 1842; but even before that time Shanghai was a place of considerable trading importance. By the treaty referred to, the port was thrown open to foreign trade, and its advantageous position led to so rapid an increase of its commerce, that it soon became the chief emporium of China. Shanghai city stands on the east of the province of Kiangsu, and on the verge of a vast productive plain, which, prior to the accession of the Chow dynasty, formed part of the old province of Yang-Chow, itself one of the nine provinces under the administration of the famous Yu. During the time of Yu, however, this part of the province was probably under water; at any rate, it was not until the beginning of the eleventh century, when the Sung dynasty occupied the throne, that Shanghai became a trade resort Previous to this date the port was at a place called Tsing-lang-chien, twenty-five miles inland, on the banks of the Woosung Kiang, at present known as the Soochow Creek, but in those days a considerable stream, and navigable for sea-going vessels. When the present Wong Poo was nothing more than a small canal, the latter gradually deepened, while the former got filled up, and this necessitated the opening of Shanghai as a trade mart. During the Mongol dynasty it was a place of great importance. Under the Ming, it had a troubled career, for its wealth drew down upon it periodical raids and invasions at the hands of the Japanese. For this reason it was converted into a walled city, at the request of the landed gentry, in 1544, and from that time it made gradual progress, and was raised in 1842 to the dignity of a treaty port, since which event it has enjoyed almost uninterrupted prosperity. The Chinese records of the successful raids of the Japanese are not without interest and significance. At that early time the Japanese successes over their Chinese foes, who always greatly outnumbered them, were due to their discipline, daring, and weapons. In connection with this subject let us glance at the relative positions and prospects of the countries. The geographical situation of Japan with respect to China bears a striking resemblance to that in which Great Britain stands to the Continent of Europe. In the one, progress is being fostered with a swift and nervous energy, with an impetus that may carry it too far, while the other remains almost in statu quo, or else adopts, with proud reluctance, those tardy measures of reform which have been pressed upon her by a closer intercourse with foreign nations, while, with rare exceptions, her rulers and people remain blindly wedded to their ancient petrified policy of exclusive ness, looking back for inspiration to the doctrines which their dead sages have handed down. But some of my readers will point to the arsenals and shipbuilding yards of Shanghai, Foochow, Nanking, and Tientsin; to the foreign college of Peking, and to the foreign customs administration. These they will count as signs of slow, determined progress. They may be so, and yet the arsenals and their products may, after all, be only intended to defend the ancient state of things. The foreign customs administration pays, whereas, if it were left in the hands of their own officials, there would be a lack of revenue. The Peking College has its native supporters in high places, but they have to fight against great odds for its maintenance. Adam Schaal and Ricci had greater and warmer supporters two centuries ago, and what came of it all ? I found a coolie drying his jacket on one of their finest astronomical instruments, on the wall of Peking. China will sooner or later be forced to press forward in the march of civilization, as her Japanese neighbours are fast discovering the secrets of Western power. When that time arrives, the Chinese will find the elements of all they are in search of at the foreign settlements in Shanghai, where the schools, the splendid commerce, the merchant palaces, the fleets of steamers, the local foreign government, the opulence of the inhabitants, and the condition of the streets and dwellings, offer an instructive contrast to the condition of the Chinese walled city which lies to the south of the foreign settlements. The labour of centuries has brought this city to its present state, and the result is little to the credit of the authorities who rule there.

The site granted for the erection of the foreign settlements was partly a marshy waste in 1843; it was, however, eagerly accepted by Capt. Balfour, then consul for Britain, and the transformation wrought there within little more than twenty-five years is one of which the settlers have just reason to be proud. It was here, too, that the system of a foreign inspectorate of customs was inaugurated in 1854; and owing to the success of the innovation, it has since been extended to all the treaty ports.

The Taiping rebellion placed a temporary check upon the trade of Shanghai, although at the same time many