In the 1590s merchants from the young Dutch Republic started the first significant commercial ventures outside Europe. After one fleet had successfully rounded the Cape of Good Hope and returned from the East Indies with spices in 1597, companies trading with Asia shot up like mushrooms. Competition was so intense that the profit margin fell to a minimum, as the cost price of spices in Asia rose while the sales price in Europe dropped. At this point, the Estates General (Dutch Parliament) intervened, founding the Vereenigde Oost- Indische Compagnie (United East India Company, or VOC). It was allowed to enter into treaties, declare wars, and build fortresses in Asia.
From the outset, military actions paved the way for commercial success. The VOC used force against natives of the Moluccas, Indian merchants, and Portuguese and English rivals to secure footholds and obtain spice monopolies. Dutch conquests in Asia included the Spice Islands of Amboina, Tidore, and Ternate (1605), Taiwan (1623), part of coastal Ceylon (1641), strategically located Malacca (1641), and parts of southwest India (1663). In addition, a way station was founded at the Cape of Good Hope (1652).
Such expansion enabled the formation of a network of factories from Japan and Siam to Ceylon, linked by a regular exchange of information and commodities. Batavia, on the island of Java, was set up in 1619 as the nerve center of the Dutch empire in Asia, to which all Dutch factories were subordinated, and as the general warehouse for goods to be exported to Europe. From the late 1650s, the Dutch monopolized the global cinnamon trade, and by the late 1660s, they had near-total control of the production and marketing of nutmeg, mace, and cloves. By contrast, pepper remained elusive, since it was cultivated over a vast area. All pepper was destined for the European market, while cloves, nuts, and mace were only shipped back after Asian demand had been satisfied. The spice monophony that enabled the VOC to fix prices left the Company with huge profits, needed to offset the large overhead costs. The Company’s policy in Europe was to slightly oversupply the market, driving down prices and thus usually discouraging competitors.
After 1680 the share of pepper and spices in the VOC’s revenues began to decline, while trade in cotton and silk fabric from India, coffee (cultivated on Java after 1711), and Chinese tea rose. After 1690 Asian profits turned into losses, as expenses kept rising and income did not increase commensurately. The VOC remained the world’s largest company throughout the eighteenth century, offering a wide array of Asian goods for sale in Europe, but it was gradually cut down to size. Nevertheless, its role as supplier of colonial goods helped Dutch merchants maintain themselves in the European markets.
After huge losses had led to the demise of the VOC in 1795, the Napoleonic Wars saw the British occupation of all Dutch colonies East and West, around 1800. By the time the Dutch retook control of their possessions in 1816, their empire had shrunk, since Britain did not restore Ceylon and the Cape Colony. More importantly, Dutch commercial hegemony in eastern Asia was now a thing of the past. After the Acultivation system, which obliged the local population to grow several cash crops, was introduced on Java in the first half of the 1830s, the Dutch recovered some lost ground. Until 1870 large amounts of coffee, sugar, indigo, tobacco, and tea were sent from Java to the Netherlands. Total proceeds from the sale of the East Indian products amounted to 451 million guilders from 1830 to 1850, almost half of which directly enriched the national treasury. East Indian revenues were partly used to finance the abolition of slavery in Dutch America.
After 1873 the Dutch expanded the territory under control in the East Indies in an often ruthless way, especially in Aceh, where a bloody war was fought with natives. By the early years of the twentieth century, a pax neerlandica prevailed from the northern tip of Sumatra to Australian New Guinea. Although benefiting from the extraction of petroleum in Sumatra and on Borneo’s east coast, overall Dutch trade with the East Indies declined. After the Dutch authorities failed to extend any form of autonomy in the 1930s to an increasingly assertive colonial population, the Japanese invasion of 1942 changed conditions drastically. Nationalists declared independence in 1945, and in 1949, after four years of warfare, the Dutch abandoned what was henceforth called Indonesia. New Guinea, the last Asian territory under Dutch rule, was given up in 1962.
THE ATLANTIC COLONIES
Dutch expansion in the Atlantic world was also as much a military as a commercial affair. The Dutch conquered the Spanish colonies of St. Martin (1631) and Curaçao (1634) and the major Portuguese strongholds in Africa: Sāo Jorge da Mina or Elmina (1637–1872) and Luanda (1641–1648). In Addition the Dutch conquered the Brazilian capital of San Salvador in Bahia (1624). In 1625, around twelve thousand portugueses-spanishes soldiers in a 52 ships fleet defeat the Ducht company. In 1629, after a rich capture of a Spanish annual Silver Fleet, the Ducht come again expanding and then contracting over Recife and Olinda, cities in a rich northern Brazil (1630–1654). During this period under Count/Prince Johan Maurits Van Nassau-Siegen goverment, Recife was the most cosmopolitan city in Americas. Another large territory under Dutch control was New Netherland (1624–1664), a fur-trading colony made up of settlements on the Hudson, Delaware, and Connecticut Rivers and on Long Island.
More enduring colonies were established on the Caribbean islands and in northern South America. Apart from Curaçao and St. Martin, the Caribbean colonies included the Windward Islands Aruba and Bonaire (1636) and the Leeward Islands St. Eustatius (1636) and Saba (1640). In Guiana, the unsettled region between the Amazon and Orinoco rivers, permanent Dutch settlements arose along the Berbice, Essequibo, Demerara, and Suriname (1667) rivers, partly in an attempt to recreate the Golden Age of Brazil. Brazil had produced prodigious amounts of sugar, tobacco, and brazilwood, filling the holds of ships bound for the United Provinces year after year. Investments in Brazil did not pay off, however, as a nine-year war ousted the Dutch from Brazil. The commercial losses sustained in Brazil eventually led to the bankruptcy in 1674 of the West India Company, the VOC’s counterpart in the Atlantic world since 1621.
Suriname boasted hundreds of sugar, coffee, cacao, and cotton plantations in the mid-eighteenth century. However, unlike other empires, the produce of the Dutch plantation colonies did not receive preferential treatment in the home market. After 1780 the smaller Dutch Guiana colonies of Berbice, Essequibo, and Demerara prospered, perhaps eclipsing the cash crop output of Suriname. Although no crops were grown commercially on Curaçao and only minor amounts on St. Eustatius, a steady traffic in colonial goods took place from these islands to the mother country. In exchange for African slaves and European commodities, Curaçao obtained cocoa, tobacco, indigo, sugar, coffee, and hides from the Spanish Main and the Spanish and French islands in the Caribbean. The second quarter of the eighteenth century saw the rise of St. Eustatius, from where French Caribbean sugar and coffee and British North American tobacco were sent to the United Provinces. In 1791 the second West India Company, which had been founded after the demise of the first, went bankrupt. The subsequent onset of the Napoleonic Wars was the kiss of death for the two islands, which lost their niche in the region’s contraband trade. Great Britain did not restore Berbice, Essequibo, and Demerara, which came to make up British Guiana. And although Suriname was returned to Dutch rule, its economic weight for the metropolis had declined by the nineteenth century. While all Dutch colonies in America received autonomy in 1954, only Suriname was given its independence, in 1975.
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