This Sung dynasty, as Chao K'uang-yin named it, no longer turned against the northern peoples, particularly the Kitan, but against the south. This was not exactly an heroic policy: the north of China remained in the hands of the Kitan. There were frequent clashes, but no real effort was made to destroy the Kitan, whose dynasty was now called "Liao". The second emperor of the Sung was actually heavily defeated several times by the Kitan. But they, for their part, made no attempt to conquer the whole of China, especially since the task would have become more and more burdensome the farther south the Sung expanded. And very soon there were other reasons why the Kitan should refrain from turning their whole strength against the Chinese. [Illustration: 10 Ladies of the Court: clay models which accompanied the dead person to the grave. T'ang period. _In the collection of the Museum für Völkerkunde, Berlin_.] [Illustration: 11 Distinguished founder: a temple banner found at Khotcho, Turkestan. _Museum für Völkerkunde, Berlin, No. 1B_ 4524, _illustration B_ 408.] As we said, the Sung turned at once against the states in the south. Some of the many small southern states had made substantial economic and cultural advance, but militarily they were not strong. Chao K'uang-yin (named as emperor T'ai Tsu) attacked them in succession. Most of them fell very quickly and without any heavy fighting, especially since the Sung dealt mildly with the defeated rulers and their following. The gentry and the merchants in these small states could not but realize the advantages of a widened and well-ordered economic field, and they were therefore entirely in favour of the annexation of their country so soon as it proved to be tolerable. And the Sung empire could only endure and gain strength if it had control of the regions along the Yangtze and around Canton, with their great economic resources. The process of absorbing the small states in the south continued until 980. Before it was ended, the Sung tried to extend their influence in the south beyond the Chinese border, and secured a sort of protectorate over parts of Annam (973). This sphere of influence was politically insignificant and not directly of any economic importance; but it fulfilled for the Sung the same functions which colonial territories fulfilled for Europeans, serving as a field of operation for the commercial class, who imported raw materials from it--mainly, it is true, luxury articles such as special sorts of wood, perfumes, ivory, and so on--and exported Chinese manufactures. As the power of the empire grew, this zone of influence extended as far as Indonesia: the process had begun in the T'ang period. The trade with the south had not the deleterious effects of the trade with Central Asia. There was no sale of refined metals, and none of fabrics, as the natives produced their own textiles which sufficed for their needs. And the export of porcelain brought no economic injury to