By Zaldy Dandan – Variety Editor
“[T]here was nothing transitory about the Japanese approach to [the Micronesian islands]. Practically everything they built was built to last, and their term of occupancy is sometimes also known as The Concrete Period. (The American Period is The Corrugated Tin Period.)”
— E.J. Kahn Jr., “A Reporter in Micronesia” (1966)
THE CNMI is commemorating the 150th birthday of Haruji “Sugar King” Matsue, the entrepreneur who transformed the Northern Marianas into a self-sufficient and highly valuable economic asset for Japan.
As scholar and writer Francis X. Hezel, SJ once observed, that period “represents the height of economic development in the islands. Never before or since have the islands been fully self-supporting.”
Yet the emergence of a sugar industry on Saipan during the Japanese era was never a foregone conclusion. In his invaluable 1988 book, “Nan’yō: The Rise and Fall of the Japanese in Micronesia, 1888–1945,” historian Mark R. Peattie recounts that two Japanese companies — “neither of which had the slightest experience in the sugar business” — attempted sugar cultivation on Saipan and failed spectacularly. Their collapse left more than a thousand Japanese and Korean workers abandoned and destitute.
The humanitarian pressures became so severe, Peattie wrote, that the civilian administration feared Japan might be forced to abandon the Northern Marianas and other Micronesian islands altogether.
Enter Haruji Matsue — an entrepreneur trained at Louisiana State University, then renowned for sugar cultivation research, who had already built his fortune in Taiwan’s sugar industry, also under Japanese rule at the time.
According to Peattie, Matsue quickly assessed his competitors, including sugar firms from Taiwan, and found them ill-prepared, if not outright incompetent. “Few had explored the interior of [Saipan], and fewer still had crossed the Tapotchau ridge to reach the eastern coast,” Peattie wrote. As Matsue set off into the island’s interior with a handful of Chamorro guides, his rivals dismissed him as an impractical dreamer.
For 10 grueling days, Matsue fought through dense undergrowth, crawling on hands and knees behind guides who hacked paths forward with machetes. He endured soaking downpours, bruising falls, and exhaustion. Then one afternoon, standing atop Mount Tapotchau, he saw it — the broad, fertile plains stretching east, south, and west to the coast, and to the north, the dramatic drop toward Banaderu’s cliffs and the sea beyond.
Feeling the rich soil beneath his fingers, Matsue realized Saipan possessed all the essential conditions for sugar cultivation: fertile land, abundant moisture, warmth, and periodic dry spells. What was missing, he concluded, was human ingenuity. With modern agricultural techniques, refining equipment, transport systems — including railways and port facilities — and rational management, Matsue became convinced that a sugar industry could flourish in the Marianas, rivaling even Hawaii and outperforming Taiwan acre for acre.
In his autobiographical account, Matsue later wrote that profit alone did not drive his vision. He was equally determined to redeem the “terrible human cost” inflicted by the incompetence and indifference of earlier corporate failures — an outcome he regarded as both a moral outrage and an international humiliation for Japan.
After securing financial backing and acquiring government land, Matsue implemented a workforce plan that prioritized the abandoned immigrants already on Saipan. Thousands more low-income farmers from Okinawa soon followed, initially housed in Chalan Kanoa. Matsue covered all emigration costs, from transportation and outfitting allowances to subsistence stipends while land was cleared.
The obstacles, however, came relentlessly, Peattie said. Refining equipment from Germany arrived late. Tenant farmers improperly pruned cane sprouts. Insects ravaged crops. His first small shipment of sugar to Japan was destroyed in the catastrophic fires following the Great Kantō earthquake. Worst of all, global sugar prices collapsed.
Japanese government and business leaders, once again doubting Micronesia’s viability, signaled their reluctance to continue support. On Saipan, fears of abandonment resurfaced. Japanese children in Garapan and Chalan Kanoa sang a bitter jingle once more:
Senmu, yoku kike yo
Omae no matsu wa
Saipan no atari de notarejini
Listen, Mr. Manager,
Your end will come,
Starving on Saipan.
Most men would have been defeated. Matsue was not. With his last remaining funds, he undertook a series of corrective measures, imported additional labor from Okinawa, and restructured operations.
By 1928, Matsue’s company, Nankō, was processing 1,200 tons of sugar daily. Within two years, sugar production expanded to Tinian and then Rota. By 1930, sugar had indeed become king of the Marianas.
Matsue’s success convinced skeptics that Japan’s fragmented Pacific colony could not only sustain itself, but become a net asset to the empire. As Hezel later reflected, it was a rare moment when economic growth alone paid the costs of government.
Matsue succeeded largely because the government did not stand in his way with arbitrary regulations. Instead, it partnered actively with private industry. Nankō benefited from nearly rent-free access to government land in its early years; subsidies for groundbreaking, land clearing, and planting; a favorable tax structure; and access to both the Japanese market and an off-island labor pool.
Attempting to replicate Matsue’s enterprise today would be virtually impossible in a region addicted to government grants and public employment, buried under layers of federal and local regulations that suffocate initiative and strangle economic growth before it can take root.
That may be the most important lesson of all — and the one we seem most determined to ignore.
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Zaldy Dandan is the recipient of the NMI Society of Professional Journalists’ Best in Editorial Writing Award and the NMI Humanities Award for Outstanding Contributions to Journalism. His four books are available on amazon.com/.
