In the annals of the economic history of the Nationalist era, the sudden arrest and execution of Feng Rui (1899–1936) has been a long-standing puzzle. Feng was an eminent and cosmopolitan public figure, a US-educated agronomist, a nationally and internationally respected agricultural reformer and director of a major provincial investment to improve China's sugarcane crop and modernize Guangdong's sugar mills. Why did a military tribunal execute him in short order? With deft analysis of a range of archival resources, Emily Hill locates Feng's execution at the crossroads of provincial rivalries, Chiang Kai-shek's efforts to break up what was seen as Guangdong's semi-autonomous government, and Nanjing's mounting tension with Japan over smuggling and tariffs. Feng's purported crime was repackaging smuggled Japanese sugar to pass it off as produced by government factories. The factories were a major nationalist enterprise intended to move China away from imports. Apparently the sugar boilers were never fired up. People called this “smokeless sugar.” The Japanese invasion of northern and northeastern China from 1931 onwards set up the broader context of rising nationalist concerns, as Japanese troops and ships provided protection for the smugglers.

Using the life and times of Feng Rui and his substantial autobiography to provide details, Hill's main arguments in the book focus on three themes: the importance of custom tariffs to the Nanjing treasury; Japanese sponsorship of smuggling activities that brought in cheap Japanese goods and thwarted Chinese efforts at manufacturing, and Japanese support for the semi-autonomous state-within-a-state formed by warlords. Japanese support for Feng Rui's patron, the local warlord Chen Jitang (1890–1954) who was openly challenging Chiang Kai-shek and Nanjing, was particularly worrisome. Guangdong's proximity to British Hong Kong and Japanese Taiwan made this a sensitive political case, for autonomy was within reach of a province as wealthy and as well located as Guangdong.

Since the days of Sun Yat-sen, Guangdong had been the base of activists who challenged the authority of Beijing and Nanjing. Chen Jitang, although nominally an official with an appointment from Nanjing, was able to support a substantial army by collecting and withholding at the provincial level all tariffs. Chen expanded his influence through an alliance with neighbouring Guangxi province; the resulting Guangdong–Guangxi Alliance was a powerful group able to challenge Chiang. Additionally, Chen was a popular leader who had garnered kudos for successful investments in infrastructural and industrial development, schools and universities. By the early 1930s, Chen was the main challenger to Chiang Kaishek's power from within the ranks of the KMT, and was suspected by Chiang of cutting secret deals with the Communists.

The issue of tariff income was complicated by the fact that Guangdong retained tariff earnings for goods that entered its ports but were sold elsewhere in the country, and the tariffs for transit of goods from other provinces intended for export. Chiang moved to curtail this income by first by redirecting the lucrative opium trade from Yunnan to Hunan instead of via Guangxi to Guangdong for transshipment to the north. The tungsten trade and its tariffs were even more valuable. Tungsten has a range of industrial uses, from light bulbs to armaments production; its price increased in the 1930s with the worldwide expansion of wars and the armaments industry. Almost all the tungsten mined in China passed through Guangdong on the way to export.

Eventually, Chen's fortunes took a negative turn with the death of his patron at Nanjing. When a potential coup against Chiang did not work out, Chen fled to Hong Kong. Hill uses the concept of a “broker” to discuss the role of Feng Rui, who constantly negotiated between the power politics of provincial authorities and the central governments' zealous efforts to control the very enterprises he was vested in. Powerful patrons at the centre provided protection for such brokers; when the patrons died or were replaced as in the case of Chen and Feng, the fall of the broker caught in between was swift, and in this instance, deadly. General Yu Hanmou, who was sent by Chiang Kaishek to replace Chen, led the military tribunal that ordered the execution of Feng Rui. It is relevant that General Yu also had interests in tungsten mines and trade.

Hill's work is rich but the inclusion of almost too many details impedes the flow of argument, which sometimes also gets lost in her committed efforts to vindicate the reputation of Feng. The bigger story here of is how the power struggle between the provincial authorities and the central government to control tariff incomes affected economic development during the Nationalist era. Overall, Smokeless Sugar is a significant contribution to Chinese business history of 1920s and 1930s, and provides a close study of an early example of state-sponsored industrialization that has since become the norm in China.