In the late 18th century British merchants built up a flourishing traffic in opium from India to China, for they had been unable to find any other product to import into China in quantity, as the country was almost self-sufficient.

The Chinese government tried to curb the opium trade and the emperor appointed a radical patriot, Lin Tse-hsu, as Imperial commissioner for an anti-opium campaign. In 1839 Lin arrived in Canton, which was the main port for foreign trade. He confiscated and destroyed more than 20,000 chests of opium. The British merchants appealed to their government and in 1840 16 British Warships arrived in Hongkong and sailed to the mouth of the Pei Ho river.

Next year they attacked the walled city of Canton. The local militia and the Imperial troops were powerless against the navy guns. In 1842 the British received reinforcements and they seized several cities including Shanghai and Nanking.

The Treaty of Nanking, concluded at the end of the war in 1842, ceded Hongkong to Great Britain, and opened several ports to British trade. It also fixed the customs duties on imports at such a low level that China was prevented from protecting her new industries from competition of cheap imports.

This treaty was the first in a series of 'unequal treaties' which gave foreigners special rights in China. American and French treaties soon followed, and the economy of China experienced a breakdown of self-sufficiency in the traditional system of agriculture and craftsmanship.