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By the early 1870s, the Ch'ing forces undoubtedly had acquired the capacity to suppress rebellion in most areas of China proper. However, it remained questionable as to whether they could stand up to foreign invaders on the coast or even deal with rebels in the difficult terrain of the North-West or Central Asia. Before imperial China's forces could get to Sinkiang, they had first to overcome the Chinese Muslims in Shensi and Kansu. The Sino-French War of 1884-5 was the first external test of China's new military and naval programmes of the past two decades. From beginning to end, the Sino-Japanese War had been an unmitigated disaster. In the peace negotiations, China's most effective bargaining point was not the remaining strength of her military and naval forces, but rather Japanese guilt over the wounding of Li Hung-chang by a Japanese fanatic.
Many scholar-officials' main emphasis was on modern industry. They generally assumed that commercial enterprises could at best play a supporting role. Influential officials who became major sponsors of modern enterprise were especially partial to industry. From the early 1870s, Li Hung-chang argued that guns and gunboats alone did not make a nation strong; their operation required the support of industry in manufacturing, mining and modern communications; industry would create new wealth - a further source of national strength. Chang Chih-tung, too, realized the link between military power and economic development. Chinese promotion of modern enterprise in the late nineteenth century was inspired by the political necessity of quickly achieving respectable national strength. This fundamental goal united government officials of various persuasions in a common commitment to industrialization. A few modern enterprises were able to avoid either official sponsorship or comprador management. Hua-hsin was in fact a private enterprise in which official and merchant shareholders collaborated as individuals.
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