There was considerable excitement in Shanghai when the Britishsteamer “Kowshing，” commanded by British officers， was sunk bythe Japanese man-of-war， the “Naniwa，” while transporting Chinesesoldiers to Corea. Inasmuch as the British Foreign Office was of theopinion that war had already broken out， it was held that the Japanesewere within their rights in sinking a transport on which enemy troopsrefused to surrender when summoned to do so.
On account of the war， the status of Shanghai caused anxietyto the commercial nations interested in the Settlements. The Taotaiinformed the Consuls of his intention to block the Woosung Bar， butas this would seriously cripple trade， it met with a general protest.
The British representative in Tokyo obtained from the JapaneseGovernment an undertaking to “regard Shanghai as outside thesphere of its warlike operations.“ Notwithstanding this assurance， theWoosung Bar was for a time partially blockaded.
The Japanese authorities soon found they had been too generousin regard to Shanghai， as the Kiangnan Arsenal was located on itsoutskirts， and the port was used to ship ammunition， supplies， andtroops. The American Government， however， joined with Englandand France to bring pressure upon Japan to carry out the neutralityagreement.
The result of the war was in some ways disastrous for China. Herweakness was still further revealed， and Western nations， realizing herinability to resist， became more insistent in their demands. China，yielding under pressure， became resentful， and the seeds of futuretrouble were sown.
In the Treaty of Shimonoseki made at the conclusion of the war，there was one article in the subsidiary treaty of commerce signed atPeking on July 21st， 1896， which was calculated to introduce a newelement into the industrial situation in China. The right was concededto carry on trade， industries， and manufactures at any of the treaty ports.
Hitherto China had opposed the introduction of factories， but fromthis time it became permissible. The privilege gained by Japan could beshared by other nations， under “the most favoured nation clause，” andthis prepared the way for an Industrial Revolution in China.
The Second Riot in ShanghaiAt a Ratepayers‘ meeting held in 1897， the Shanghai MunicipalCouncil was authorized to raise the price of wheelbarrow licences.
When， on April 1st， an attempt was made to carry out this regulation，the wheelbarrow coolies went on strike， and for two or three days therewere minor disturbances.
On April 5th a mob from the French Concession crossed abridge over the Yangkingpang， and， streaming into the InternationalSettlement， started a riot. The alarm bell was rung， the volunteerscalled out and shore parties landed from H. M. S. “Linnet，” H. M. S.
“Plover” and U. S. S. “Monocacy.” The rioters were dispersed， but forseveral days there was a state of tension. Much to the indignation of theforeign community， it was announced on April 6th that the Councilhad backed down and agreed to a compromise. At a meeting of thecornmunity which was very largely attended， a strong protest was madeagainst the Council"s action， and the opinion was expressed that owingto it， the prestige of fifty years had been lost.