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Non-Japanese entrepreneurs established two of the companies that became core Mitsubishi companies. An American established the predecessor of Kirin Brewery in 1870, and the Scotsman Thomas Glover later played a pivotal role in the histories of Kirin and other Mitsubishi companies (Mitsubishi Monitor, November 1998) Here, we take a look at the American beginnings of Mitsubishi Paper Mills.
Thomas and John Walsh were scions of an upper-class American family. John, the younger of the two, traveled to Nagasaki in 1862. Thomas, who had engaged in trading ventures in China in the 1850s, soon joined him there.
Japan only recently had opened its doors to the world after two-and-a-half centuries of isolation. The nation was racing to catch up with the West in technology and industry. It presented commercial opportunities aplenty for entrepreneurial foreigners. Nagasaki, on the southern island of Kyushu, was the site of Japan's first foreign enclave. It was where Thomas Glover began his illustrious career in Japan.
The Walsh brothers set up a trading company with a fellow American in Nagasaki in 1862 and soon opened branches in Yokohama and Kobe. They were leaders in the foreign business community, and John Walsh became the first American consul in Nagasaki. Contemporary accounts record that the brothers worked unselfishly to assist Japanese who traveled to the United States on study missions. They even mobilized their younger brother, who lived in the United States, to escort Japanese visitors.
When local entrepreneurs established Japan's first modern paper company, the Walshes arranged for importing the production equipment from the United Kingdom. Japanese had been making and using paper, of course, for hundreds of years. But they lacked technology for mass-producing paper to use in modern printing equipment.
The brothers became influential spokesmen for Japan's fledgling paper industry. Thomas led the formation of an industry cartel. And the brothers promoted an import tariff to protect local manufacturers. They also helped persuade the government to stop selling paper through its printing bureau. The Walshes argued convincingly that direct government involvement in the marketplace hindered the sound development of private-sector industry.
Meanwhile, the brothers entered the market themselves. Scrap cotton fabric was the chief raw material for paper in the industrialized nations in the late 19th century. Used fabric was available almost for the asking in Japan, where blue-dyed cotton garments were standard apparel for most people. The Walshes and other investors set up Japan Paper Making Co., Ltd., in Kobe in 1875 to convert scrap cotton fabric into pulp for export.
Work began on the factory. Costs ran far beyond the initial budget, however, and a dispute arose among the participants in the project. Fate intervened when the American brothers reluctantly put the company up for sale.
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