Da-Qing Baochao

The Great Qing Treasure Note () or Da-Qing Baochao refers to a series of Qing dynasty government notes issued under the reign of the Xianfeng Emperor issued between the years 1853 (Xianfeng 3) and 1859 (Xianfeng 9). These government notes were all denominated in '' wén'' and were usually introduced to the general market through the salaries of soldiers and government officials.

After the Taiping Rebellion had depleted the imperial treasury of the Qing dynasty the government reformed the cash coin system to include higher denominations with low intrinsic values essentially creating a fiat currency; this was a radical departure from China's past where the value of cash coins was dependent on their weight rather than any denominations. The same developments which lead to the creation of the new Xianfeng coinage had also necessitated the reintroduction of paper money in China after it was absent for two centuries. The new paper currency came in two forms, one was the copper-alloy cash coins-based Great Qing Treasure Note and the other was the silver sycee-based Hubu Guanpiao (戶部官票) which were both introduced simultaneously with the new debased cash coinage.

However, the government did not keep adequate reserves of hard currency to back the new notes up. Many provincial governments didn't allow for taxes to be paid using paper money, and after a few years the government started refusing to convert the new paper money into hard currency; consequently, the Chinese people started to distrust it as a valid medium of exchange. In response to the ever more expensive military expenditures caused by the Taiping Rebellion, the government produced more and more high denomination notes, which were not convertible. This caused hyperinflation; by the year Xianfeng 9 (1859) the currency had become completely depreciated and was abolished.

History

Earlier Qing dynasty notes

During the transition from Ming to Qing the Manchu government-issued notes known as Hubu Guanpiao (戶部官票) or '' Shunzhi Guanpiao'' (順治官票) or ''Shunzhi Chaoguan'' (順治鈔貫) which were first issued in the year 1651 on initiative of the Minister of Revenue, Wei Xiangshu (魏象樞) during the war with the remnants of the Ming dynasty to cover the more immediate expenses of the Manchus as the finances of the Qing during this period were in dire distress, these notes were declared void only a decade after their issued. An annual amount of 128,000 '' guàn'' (貫) of these early Manchu notes were issued, with a total sum of 1.28 million ''guàn'' being produced before they were abolished. The denominations of the Hubu Guanpiao followed the pattern of the Ming dynasty period paper notes, but as historiographical sources about the early Qing era paper money are scarce, not much can be known about them.

Peng Xinwei suggested that the Manchu rulers of the Qing were very much atavistic towards the inflationary pressure that the earlier Jurchen Empire experienced after they had abused their ability to print Jiaochao notes. Modern scholars argue that the notes issued during the Shunzhi period, while only brief, likely entrenched the reluctance of the Qing dynasty to issue notes because this issue also proved inflationary confirming their fears.

It has been suggested by Taiwanese economic historian Lin Man-houng that Chinese money shops did not start with the production of their own private notes until the end of the Qianlong period, these shops were very likely to have been more developed in Northern China, where these money shops produced notes which were mostly denominated in cash coins while notes from Southern China tended to be denominated in taels of silver. It is also possible that private-order notes could have emerged earlier in the 18th century and that their presence would become very common by the 1820s.

Economic and monetary background

The precursor of paper money (紙幣) known as " flying cash" were issued by the Tang dynasty; however, these bills of exchange could in no way be considered to be a form of paper money as they weren't meant to be a medium of exchange and were only negotiable between two distant points. The first true paper money in the world was issued under the Song dynasty, these were promissory notes issued by merchants in Sichuan known as the Jiaozi, under the reign of Emperor Zhenzong (997–1022) the government of the Song dynasty granted a monopoly for the production of Jiaozi notes to sixteen wealthy merchants in Sichuan, as these merchants were slow to redeem their notes and inflation started affecting these private notes the government nationalised paper money in the year 1023 under the Bureau of Exchange. As these paper notes were backed by the government they were instantly successful and the people regarded them to be equally trustworthy as cash coins, other types of paper notes issued under the Song dynasty include the Huizi and the Guanzi. Before the Mongol Empire conquered China the Jin dynasty also issued paper money.

Before the establishment of the Ming dynasty the Mongol Yuan dynasty had suffered from a severe case of hyperinflation which made the paper money issued by them worthless. Under the reign of the Yuan dynasty copper cash coins remained in circulation with the inscriptions Zhida Tongbao (至大通寶), Dayuan Tongbao (大元通寶), and Zhizheng Tongbao (至正通寶) forming the majority of the circulating issues and " strings of cash coins" remaining a currency unit. Silver then started to occupy a paramount place in the Mongol economy and was supplemented by government issued paper money. Under the reign of Kublai Khan the Zhongtong Jiaochao (中統交鈔) was issued whose value was based on the fabric silk. Under the reign of Külüg Khan in the year 1308 the Zhiyuan Baochao (至元寶鈔) was issued which was supplemented with the silver-based Zhida Yinchao (至大銀鈔), but these circulated only for a year. The final series of paper money issued by the government of the Yuan dynasty from 1350 were the Zhizheng Jiaochao (至正交鈔). A major difference between how paper money was used under the Mongols and under the Song dynasty was that, in certain regions of the Yuan dynasty, paper notes were the only acceptable form of currency and could not be exchanged in either copper cash coins or silver sycees. Exchanging paper money into copper or silver was known as ''duìxiàn'' (兌現, "convert into specie") which was the main reason why earlier forms of paper money were deemed reliable. As these regions were completely dependent on paper money inflation hit them more severely as their notes could not be converted into a currency based on any intrinsic value, for this reason the Mongols allowed their subjects to continue using copper-alloy cash coins and issued new ones every now and then. During the last few decades of the Yuan dynasty the inflation caused people to lose their trust in paper money and barter became the most common means of exchange.

During the beginning of Manchu rule over China in the year 1644, the total imperial revenues of the Qing dynasty were an approximated 30,000,000 tael