Japanese Civilization (Part 8).

(From Journal of Japanese Trade & Industry (JJTI))

Byline: Kawakatsu Heita

The Elimination of Imported Currency at the End of the 17th 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 currencies. The possession of its own currency is proof of a nation's independence.

Until the Edo period (1603-1868), Japan depended on copper coins imported from China for its currency. Can pre-Edo Japan be described as an independent nation even though it used money minted in China? 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, the General Headquarters of the Supreme Commander for the Allied Powers (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 (now Hyogo Prefecture) in the late Heian period (781-1185) 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 sphere.

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 Hakusonko on the coast of the Korean peninsula in 663. Following the example of the city of Chang'an, the Japanese built Fukuharakyo and Heijokyo using the grid-patterned jori system, and, following the compilation methods used in the official history of China (authorized by the emperor), they drew up the Nihon Shoki (The Chronicles 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 toward independence was the minting of copper coins such as the Fuhonsen, Wado Kaichin, 12 coins of the imperial court of Japan (Kochojunisen). Here too, the newly formed Japanese nation followed the example of the copper coins that had been used in China from the Han dynasty (202 BC-AD 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 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.