Penetration of Japanese Cotton Cloth into Southeast Asia in the Interim of the Two World Wars

Abstract

The export of Japanese cotton cloth to Southeast Asia had two peaks in statistics: one in 1920's and the other in 1930's. There were remarkable difference in the kind of cloth between the two periods. In 1920's, the import of cotton cloth from Japan mainly consisted of grey cloth. On the other hand, the peak in 1930's was marked by bleached cotton fabric, especially in Dutch East Indies.According to the common view, the Japanese cotton penetration in 1930's was due to their cheap price, which had been enabled to be achieved by the drastic fall of the exchange rate of Japanese Yen and the smaller cost of production of Japanese cotton industry at that time. But, in 1920's, the market of Southeast Asia attained to its maximum capacity to import Japanese grey cloth. If Japan had also continued to export grey cloth in 1930's, she couldn't, in spite of its cheap price, have enjoyed increasing volume of cotton cloth export in Southeast Asian market.The Japanese cotton industry could find a new market of bleached cotton colth in Southeast Asia. But, this market was the last resort of the declining cotton industries of European countries, which were losing their market not only for grey cloth but for colored one. The struggle for the market share of Southeast Asia between Japan and European countrees was becoming keaner and keaner. In Dutch East Indies, this economic friction produced the import restriction by the colonial government and also the difficult Trade Negotiation between Japan and the Netherlands in 1934.This paper attempts to analyze the above fact on the basis of the trade statistics available in Japan. We must notice that grey cloth and bleached one are different kinds of manufactured goods. Bleached fabric to export to Southeast Asia was enabled to presuppose the development of Japanese processing industry of cotton fabric in 1920's. And fortunately bleached fabric had larger share of imported cloth in Southeast Asia, particularly in Dutch East Indies. These facts reproduced Southeast Asia, which was the old market of Japanese cotton industry, as an important new market in 1930's.