Javanese Sugar Industry under the Dutch Colonial Rule (Japanese Capitalism and the Colonies)

Abstract

This article aims at providing some data and information on the Javanese sugar industry at the summit of its development in the 1920s, with the purpose of making a contribution to the comparative study of economic history of Asian countries under the colonial rule before the World War II. The distinctive features of sugar production in Java which were not found in other sugar production areas such as Taiwan and the Philippines, can be summarized as follows: First, sugarcane was planted in the paddy fields of local peasants under the system of rotation farming with rice production. Secondly, sugar mills directly managed cane production in the fields which were possessed by peasants. In other words, the system of land renting from peasants to sugar mills made it possible to establish the complex system of production, a kind of articulation between the agro-industry of sugar production and the rice farming for subsistence by peasants. The direct management of cane production by the mills brought about much higher productivity of land than other areas, which gave it strong competitiveness in external market. Thirdly, in the 1920s Java mainly produced white sugar (plantation white sugar) for direct consumption. Needless to say, these three features mentioned above were closely interrelated and were developed in the background of the dependence of Javanese sugar on the free export market in the Asian region. As for the features of the producers of industry, it should be noted that most of them were Dutch enterprises which were organized as limited companies and coordinated within a syndicate. Among these Dutch companies, six prominent groups of enterprises were found out, each of which was integrated by a single banking corporation which was called cultuurbank. Sugar enterprises owned by Asians, i. e. the Chinese, the Japanese and the Javanese, were also found out, but their share in production was far smaller than Dutch enterprises. However, since the beginning of the 20th century, the biggest market for export of Javanese sugar had been made up of neighboring countries in Asia, especially India, China (including Hongkong) and Japan. In this relation, it is important to note that Japanese buyers increased the amount of purchase of Javanese sugar so rapidly that at the midst of the 1920s the volume of their purchase exceeded that of the Western buyers.