Economy of the Five Dynasties

The sixty odd years of the Five Dynasties period again brough a permanent time of ceaseless political and military fights that disturbed the healthy development of the economy. The warfare campaigns of the northern rulers and the raids of the Khitan troops of the Liao Dynasty 遼 imposed a heavy burden on the peasant population. During the Later Zhou era the external situation was slightly relaxed, and Emperor Houzhou Taizu 後周太祖 could restore the economic basis of northern China by redistributing a part of the large land estates and badlands that had been given up by refugees, and drought animals to private peasants. Furthermore, the Later Zhou rulers had dykes and waterways repaired and refurbished, and had new coins cast. International trade was encouraged with neighbouring states like the Western Xia Empire (Xixia) 西夏, the Korean empire of Koryŏ, the Liao empire, and of course, with the southern states inside China. Although self-reliance was possible for most of the states during that historical period, some goods were only accessible by inter-state trade, like tea that was only produced in the south, and horses and silk that came from the north.
In southern China the situation was much better. South of the River Yangtze was not only the center of agricultural output, but the ruling elite carried out arrangements to ameliorate agriculture, handicrafts and trade. Because the south was divided into different realms or kingdoms, all of them developed their local character in economic activities. While the two kingdoms in Sichuan often relied of themselves, the coastal states had intensive sea trade relationships with foreign countries in East and Southeast Asia. In the regions of Fujian and Zhejiang, sericulture (silk production) and tea production became an important economic factor. These two proto-industrial agricultural realms as well as handicrafts like spinning and weaving, paper production, salt production, printing and ceramic manufacturing (porcelain) made substantial progress especially in the south, also due to the increase in the population a part of which were refugees from the north.