After the Spanish acquisition of the Philippines, the exchange of goods between China and western Europe accelerated dramatically. From 1565, the annual Manila Galleon brought in enormous amounts of silver to the Asian trade network, and in particular China, from Spanish silver mines in South America. As demand increased in Europe, the profits European traders generated within the Asian trade network, used to purchase Asian goods, were gradually replaced by the direct export of bullion from Europe in exchange for the produce of Asia.
The Qing, and its predecessor the Ming, shared an ambivalent attitude towards overseas trade, and maritime activity in general. From 1661 to 1669, in an effort to cut off Ming loyalists, the Qing issued an edict to evacuate all populations living near the coast of Southern China. Though it was later repealed, the edict seriously disrupted coastal areas and drove many Chinese overseas.
Qing attitudes were also further aggravated by traditional Confucian disdain (even hostility) towards merchants and traders. Qing officials believed that trade incited unrest and disorder, promoted piracy, and threatened to compromise information on China's defences. The Qing instituted a set of rigid and incomplete regulations regarding trade at Chinese ports, setting up four maritime customs offices (in Guangdong, Fujian, Zhejiang, and Jiangsu) and a sweeping 20 percent tariff on all foreign goods. These policies only succeeded in establishing a system of kickbacks and purchased monopolies that enriched the officials who administered coastal regions.
Although foreign merchants and traders dealt with low level Qing bureaucrats and agents at specified ports and entry points, official contact between China and foreign governments was organized around the tributary system. The tributary system affirmed the Emperor as the son of Heaven with a mandate to rule on Earth; as such, foreign rulers were required to present tribute and acknowledge the superiority of the imperial court. In return, the Emperor bestowed gifts and titles upon foreign emissaries and allowed them to trade for short periods of time during their stay within China.
Foreign rulers agreed to these terms for several reasons, namely that the gifts given by the Emperor were of greater value than the tribute received (as a demonstration of imperial munificence) and that the trade to be conducted while in China was extremely lucrative and exempt from customs duties. The political realities of the system varied from century to century, but by the Qing period, with European traders pushing to gain more access to China, Qing authorities denied requests for trade privileges from European embassies and assigned them "tributary" status with missions limited at the will of the imperial court. This arrangement became increasingly unacceptable to European nations, in particular the British.