Philippines Table of Contents
As long as the Spanish empire on the eastern rim of the Pacific
remained intact and the galleons sailed to and from Acapulco, there was
little incentive on the part of colonial authorities to promote the
development of the Philippines, despite the initiatives of Jos? Basco y
Vargas during his career as governor in Manila. After his departure, the
Economic Society was allowed to fall on hard times, and the Royal
Company showed decreasing profits. The independence of Spain's Latin
American colonies, particularly Mexico in 1821, forced a fundamental
reorientation of policy. Cut off from the Mexican subsidies and
protected Latin American markets, the islands had to pay for themselves.
As a result, in the late eighteenth century commercial isolation became
less feasible.
Growing numbers of foreign merchants in Manila spurred the
integration of the Philippines into an international commercial system
linking industrialized Europe and North America with sources of raw
materials and markets in the Americas and Asia. In principle,
non-Spanish Europeans were not allowed to reside in Manila or elsewhere
in the islands, but in fact British, American, French, and other foreign
merchants circumvented this prohibition by flying the flags of Asian
states or conniving with local officials. In 1834 the crown abolished
the Royal Company of the Philippines and formally recognized free trade,
opening the port of Manila to unrestricted foreign commerce.
By 1856 there were thirteen foreign trading firms in Manila, of which
seven were British and two American; between 1855 and 1873 the Spanish
opened new ports to foreign trade, including Iloilo on Panay, Zamboanga
in the western portion of Mindanao, Cebu on Cebu, and Legaspi in the
Bicol area of southern Luzon. The growing prominence of steam over sail
navigation and the opening of the Suez Canal in 1869 contributed to
spectacular increases in the volume of trade. In 1851 exports and
imports totaled some US$8.2 million; ten years later, they had risen to
US$18.9 million and by 1870 were US$53.3 million. Exports alone grew by
US$20 million between 1861 and 1870. British and United States merchants
dominated Philippine commerce, the former in an especially favored
position because of their bases in Singapore, Hong Kong, and the island
of Borneo.
By the late nineteenth century, three crops--tobacco, abaca, and
sugar--dominated Philippine exports. The government monopoly on tobacco
had been abolished in 1880, but Philippine cigars maintained their high
reputation, popular throughout Victorian parlors in Britain, the
European continent, and North America. Because of the growth of
worldwide shipping, Philippine abaca, which was considered the best
material for ropes and cordage, grew in importance and after 1850
alternated with sugar as the islands' most important export. Americans
dominated the abaca trade; raw material was made into rope, first at
plants in New England and then in the Philippines. Principal regions for
the growing of abaca were the Bicol areas of southeastern Luzon and the
eastern portions of the Visayan Islands.
Sugarcane had been produced and refined using crude methods at least
as early as the beginning of the eighteenth century. The opening of the
port of Iloilo on Panay in 1855 and the encouragement of the British
vice consul in that town, Nicholas Loney (described by a modern writer
as "a one-man whirlwind of entrepreneurial and technical
innovation"), led to the development of the previously unsettled
island of Negros as the center of the Philippine sugar industry,
exporting its product to Britain and Australia. Loney arranged liberal
credit terms for local landlords to invest in the new crop, encouraged
the migration of labor from the neighboring and overpopulated island of
Panay, and introduced stream-driven sugar refineries that replaced the
traditional method of producing low-grade sugar in loaves. The
population of Negros tripled. Local "sugar barons"--- the
owners of the sugar plantations--became a potent political and economic
force by the end of the nineteenth century.
Source:
U.S. Library of Congress
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