KWANTUNG, an important territory in South Manchuria, at the southern end of the Liao-tung peninsula, leased by China to Japan and in statistical works on the Japanese Empire usually described as Kwantung Province. The territory, which includes adjacent islands, covers an area of about 1,300 square miles, The great strategic significance of this southern apex of the peninsula, containing a magnificent ice-free, deep-water harbour, destined to be transformed into the naval base of Port Arthur, and commanding the sea-approaches to Peking through the Strait of Pe-chi-li, made it one of the chief objectives of the southward advance of Russia through Manchuria at the end of the nine teenth century; and in 1898 China was forced to lease it for a period of 25 years. The construction by the Russians of the railway line from Changchun to Dairen had begun in 1896, and the branch-line to Port Arthur was opened in 1908. After the Russo-Japanese War, by the Treaty of Portsmouth (1905), the lease was transferred to Japan, together with the cession of the South Manchuria Railway. As part of the Japanese demands on China in 1915, the lease, which was to expire in 1923, was extended to 1997. The Kwantung Government-General was, by Imperial Ordinance (1919), constituted a civil government (Kwantung Office) to take over the civil administration and policing of the Leased Territory and the South Manchuria Railway Zone. The seat of the Government is at Port Arthur.
Since 1907 the Leased Territory has been accounted a Chinese Customs district, with Dairen the customs port (free port) and sub-stations at Kinchow, Pulantien, Pitzewo and Port Arthur.
1924 Imports Hk. Taels ( =4/4) Exports 171,259,261 Hk. Taels.
Japan in that year supplied 42-6% of the imports and took of the exports. (For trade see also DAIREN.) Among the chief agricultural products of Kwantung and the Railway Zone are beans, millet, maize, wheat, hemp, groundnuts, tobacco and vege tables. The fishing industry on the coast is very important; the total yield of tons in 1923 was valued at Y1,643,803. Salt is abundant, and one of the chief manufactured products. The combination of valuable natural resources, abundant fuel, and cheap labour, has led to the great expansion of industry in Kwantung and the Railway Zone. The manufacture of bean-oil and bean-cake (exported mainly to Europe and Japan through Dairen and Newchwang) and flour-milling, are the principal in dustries, together with iron founding, brewing and the manufacture of leather, cement, paper, glassware, soap and bricks. There is an elaborate educational system, including technical and commercial colleges.
The population (Dec. 31, 1925) is as follows:—Kwantung Leased Territory:—Japanese 91,376; Chinese 665,989; Foreigners Total 757,806. South Manchuria Railway Zone:—Japanese 92,645; Chinese 580,534; Foreigners 1,466; Total 274,645. It has been estimated that whereas in Manchuria generally the Chinese population has doubled in the past 20 years, in the Railway zone it has increased sixteen-fold.