In the context of the Eighty Years' War (Dutch Revolt), the general expansion of trade and shipping, and to a lesser extent, the missionary impulse of Calvinism, Dutch overseas expansion was spurred by a powerful combination of politico-economic, commercial, and religious motivations. The "first shipping" to Asia of 1595 was followed by the creation of "precompanies" in various cities of the northern Netherlands trading to the East. To curb internal competition and forge a military-diplomatic tool against the Spanish-Portuguese colonial possessions, these "precompanies" were combined into the United East India Company (or VOC after its Dutch initials). On 20 March 1602 the States-General of the Dutch Republic issued a charter, which was continuously renewed until 31 December 1799, when the charter lapsed and the possessions of the VOC were taken over by the Dutch government.
Organization and Policy
According to its charter, the VOC was given the monopoly of all shipping "from the Republic east of the Cape of Good Hope and through Straits Magellan." The company's sphere of operation effectively covered the Indian Ocean basin from South Africa and Persia in the West, via India, Ceylon (Sri Lanka), Melaka, and the Indonesian Archipelago, to China and Japan in the Far East. The charter combined the existing organization of the "precompanies" with several new regulations. Six chambers were established in Amsterdam, Zeeland (Middelburg), Rotterdam, Delft, Hoorn, and Enkhuizen. The distribution of activities, such as the construction and equipping of ships or sale of return cargoes, was carefully apportioned: Amsterdam was accorded one-half, Zeeland one-quarter, and the four smaller chambers each one-sixteenth of a share. The total number of local directors was reduced to sixty: Amsterdam had twenty, Zeeland twelve, and Rotterdam, Delft, Hoorn, and Enkhuizen each seven. Each chamber twice or three times annually selected representatives, who deliberated for several weeks in Amsterdam or Middelburg to determine central policy. This board of directors or Gentlemen Seventeen (Heeren XVII) consisted of eight representatives from Amsterdam, four from Zeeland, one from each of the four smaller chambers, and a final member selected by Zeeland or one of the smaller chambers. The charter also granted the company delegated sovereign powers, including the right to appoint governors, build forts, maintain armies and fleets, and conclude treaties with or wage war against indigenous rulers.
A central Asian rendezvous and trade emporium was established at Jakarta, renamed Batavia, on the island of Java in 1619. Batavia was the seat of the high government, the governor-general, and the Council of the Indies, which coordinated activities of the company settlements in the East. In theory subject to the authority of the board of directors in the Dutch Republic, this formal subordination was often easily lost in practice in a distant Asian environment. The administration of the regional and local settlements in the East, subject to the authority of the high government, replicated that of Batavia.
The "General Instruction" of the directors to the High Government in April 1650 specified that the company divide its trading operations in Asia into three categories, with their relative significance indicated by their respective designations. The Dutch East Indies consisted of twenty or more establishments of different character and function. The core consisted of those areas where the company enjoyed trade as an outcome of its "own conquest," exercising its own jurisdiction. The majority of Dutch conquests was formed by either spice-producing areas or trade emporia, such as the "governments" of Ambon, Banda, Cape of Good Hope, Coromandel, Makassar, the northeast coast of Java, Taiwan, and Ternate. A second category contained those regions where the company conducted trade "by virtue of exclusive contracts" with indigenous rulers, giving it monopolistic or monopsonic rights on local exports or imports, such as the "commandments" of Malabar and the west coast of Sumatra. The third category consisted of those regions where trade was conducted "by virtue of treaties." There the company did not occupy any special position and found itself merely one among many merchant communities. This category included economically important establishments under a director, including Bengal, Surat, and Persia; part of powerful indigenous empires, such as Mughal India or Safavid Persia; and peripheral establishments under a resident, head, or chief, such as Banjarmasin, Ligor, or Tonkin.
Economic Structures and Trends
Before the industrial revolution, trade between Europe and Asia was characterized by a structural trade imbalance. The deficit was supplemented via the remittance of bullion from Europe and the reimbursement of Asian bills of exchange in Europe along with profits earned in the intra-Asian or inter-country trade. The intra-Asian trade served the dual function of acquiring commodities directly for Europe and earning additional means of exchange to finance Euro-Asian trade. The economic history of the VOC can be divided into three distinct periods: a monopolistic phase, 1600–1680; a competitive phase, 1680–1740; and disengagement and decline, 1740–1800 (for financial results, see Table 1).
Dutch dominance in world trade and shipping after 1590 revolutionized the world economic order and transformed the pattern of Europe's colonial expansion. Between 1600 and 1680 the company's trade was determined by the acquisition of monopolistic or monopsonistic positions in various commodities and markets. Pepper and the fine spices (nutmeg, mace, cloves, and cinnamon) were and remained the raison d'être of company activities, accounting for 57.4 percent of the triennial sales of the Amsterdam Chamber in 1668–1670 (see Table 2). The spice monopoly was achieved through the bloody conquest of spice-producing areas and trade emporia, such as the Banda Islands (1622), Malakka (1641), Ambon (1655), the Southwest Ceylon littoral (1656), Makassar (1667), Ternate (1677), and Bantam (1682). Despite the capture of the Portuguese strongholds on the Malabar coast (1663) and Bantam, along with the conclusion of exclusive agreements with indigenous rulers of Sumatra, the company was unable to acquire a similar monopoly in pepper. By default the Dutch after 1641 also became the only Europeans to reside in Japan, an important source for gold, silver, and copper. Other monopolistic or monopsonistic positions included the export of elephants from Ceylon and tin from the west coast of the Malaysian Peninsula. The VOC also attempted to monitor and tax the intra-Asian trade by issuing passes and levying protection rights, but by 1680 concluded that the "true force of the passes was dead" (cited in Vink, 1990) because of the widespread use of flags of convenience and other means by Asian traders and merchants.
Dutch world trade hegemony in the last decades of the seventeenth century was gradually eroded, and many signs of incipient decline were attributable to the growth of mercantilist forces elsewhere. After 1680 the Euro-Asian and intra-Asian trades entered a new, more competitive phase characterized by the diminishing importance of monopolistic commodities and monopsonistic positions. The highly lucrative fine spices from eastern
Expenditures and Sale Revenues of the Dutch East India Company, 1640–1795
(in Millions of Guilders)
SOURCE: J.P. de Korte, The Annual Accounting in the VOC, Dutch East India. Amsterdam, 2000, Appendix 1.
Indonesia and Ceylon and minerals from Japan were gradually supplanted by less-profitable nontraditional products, such as textiles, coffee, and tea, available on the relatively open markets of India, Arabia, and China. The share of cloves, nutmeg, mace, and pepper in the sale value of the Amsterdam Chamber in 1738–1740 decreased to 35 percent, while that of the "new" commodities rose concomitantly to 28.3 percent (textiles and raw silk) and 24.9 percent (tea and coffee). This "era of afterglow" or "profitless growth" was also characterized by an increasing volume of trade but no corresponding economies of scale.
From the 1680s onward the company gradually extended its sway over parts of eastern Indonesia, Java, and Ceylon. In eastern Indonesia, the Pax Neerlandica in Maluku, firmly established in the 1660s, was consolidated by the assertion of supremacy over the sultanates of Ternate (1683) and Tidore (1689). On Java the VOC, starting in 1677, was drawn into a series of succession wars involving the interior sultanate of Mataram. On the island of Ceylon the company's attempt to extend control over the coastal areas led to growing tensions with the inland kingdom of Kandy. Expansion north and
Homeward Cargoes in the Euro-Asian Trade: Analysis of Imports and Sales of Various Commodities at the Amsterdam Chamber in Selected Triennial Periods
SOURCE: Jaap R. Bruijn, Femme S. Gaastra, and Ivo Schöffer, Dutch-Asiatic Shipping in the 17th and 18th Centuries. Volume I: Introductory volume. Rijks Geschiedkundige Publicatiën, Grote serie 165. The Hague 1987, p. 192; Kristof Glamann, Dutch-Asiatic trade, 1620–1740. The Hague 1981, pp. 12–14 and 269–278.
eastward into the Cape hinterland after 1717 was the work of the Boers, discharged company servants and European settler-farmer immigrants. While the company faced growing expenses in Asia, revenues declined as the fabric of intra-Asian trade started to unravel with the decline of the Mughals (after 1707), the fall of the Safavids (1722), and the increasing restrictive policies of the Tokugawa shogunate in Japan after 1685.
The period after 1740 was one of afterglow and final collapse of Dutch supremacy in world trade, marked by the commencement of the era of Franco-British global wars and a distinct decline in terms of the volume of Dutch trade and shipping. The last great period of Dutch trade extended from 1740 until the outbreak of the Fourth Anglo-Dutch War (1780–1784), when Dutch shipping and colonial trade were severely disrupted. During the last fifteen
European, Free Asian, and Slave Populations of Various Establishments of the Dutch East Indies in the Late Seventeenth Century
(Estimates in Italics)
Total European Population
Free Asian Population
* This is the figure for 1687.
** Inside and outside the city of Batavia alone. An accurate estimate of the free Asian population in the Ommelanden is impossible to make.
*** This is the figure for 1700. The total European population includes the 3,853 Company servants for 1700, plus the 2,266 Europeans listed for 1699 inside and outside Batavia.
**** Company slaves only.
SOURCE: W. Philippus Coolhaas ed., Generale missiven van gouverneurs-generaal en raden aan Heren XVII der Verenigde Oostindische Compagnie. 9 vols. to date. The Hague 1960–ongoing, IV, V and VI, passim; Robert Carl-Heinz Shell, "Slavery at the Cape of Good Hope, 1680–1731. Ph. D. dissertation, Yale University, pp. 486 and 491; VOC 1434, OBP 1688, fls. 263v–265v, Samentrekking huisgezinnen, 17.12.1687.
years of the Dutch Republic (1780–1795) and the subsequent French occupation, Dutch trade functioned at reduced levels compared with previous decades. Financial deficits in Asia assumed disastrous proportions. The creation of the Batavian Republic, in alliance with France, in 1795, precipitated a massive new British onslaught on Dutch shipping and commerce around the globe and initiated the collapse of the VOC on 31 December 1799. The loss of power and influence was most marked in the western Indian Ocean, where military setbacks contributed to the overall processes of disengagement and decline in India and the Persian Gulf. In addition the spice monopoly in eastern Indonesia was undermined by French and English activities after 1770. On Ceylon and Java the company, as a reluctant imperialist, was drawn into a creeping process of territorial expansion, evinced by the Treaties of Colombo (1766) and Gyanti (1755) respectively.
Population Size and Trends
The population of the Dutch East Indies was a typical plural society, with Europeans, the free Asian population, and slaves separated along religious, social, and linguistic lines (see Table 3). Typical of a trading post empire or militarized trade diaspora, the Dutch East Indies was concentrated around a relatively small number of central places scattered across the Indian Ocean basin. The major urban centers included Batavia, Cape Town, Cochin, Colombo, Kotah Ambon, Melaka, and Vlaardingen or Makassar (see Table 4).
Europeans consisted of company officials and free burghers. Company officials served as administrator-merchants, sailors, soldiers, craftspeople, clergy, medical practitioners, and other occupations in the settlements, in the intra-Asian trade, and aboard the homeward- and outward-bound ships. Their numbers increased from 7,700 in 1625 to 25,000 in 1700, peaked at 35,000 in 1750, and declined to 27,000 in 1780. The number of personnel on the Dutch East Indian establishments displayed a similar pattern with 3,000 employees in 1625, 18,000 in 1700, 25,000 in 1750, and 18,500 in 1780. About half were military, and one-third to one-fourth were seamen. The largest establishments were Java and Ceylon, each with 3,000 to 4,000 officials in the eighteenth century. A significant number of VOC servants came from abroad, especially
Population and Slave Population of Various Urban Settlements of the Dutch East Indies in the Late Seventeenth Century
SOURCE: Markus P. M. Vink, "'The world's oldest trade': Dutch slavery and slave trade in the Indian Ocean in the seventeenth century," Journal of World History
German states and principalities: 40 percent of the sailors and 60 percent of the soldiers were of foreign descent.
Free burghers or settlers consisted of time-expired company officials who decided to stay in the East Indies and, much less significant, married couples and families from Europe. Initial schemes to foster the settlement and growth of Dutch communities in the tropics proved abortive, with the notable exception of the Cape of Good Hope. High mortality rates, restrictive commercial policies, powerful Asian competition, and failure to induce respectable Dutch women to emigrate precluded the emergence of an equivalent of the large class of casados (married men) and moradores (settlers) in the Portuguese colonial empire. A significant portion (one-fourth to one-eighth) was Indo-European, born in Asia but of European or European-Asian descent (low-class or slave origins). The most popular occupations were in the service sector and agriculture, such as the perkeniers, who cultivated the nutmeg gardens, in Banda, the wheat and wine growers of the southwestern Cape, and the pastoral farmers of the Cape interior.
On Java and Ceylon the VOC also ruled over large populations of free Asians. On Java these included peoples from the archipelago, Chinese, indigenous Christians, and Indo-European mestizos. On Ceylon the company wielded jurisdiction over significant numbers of indigenous Christians, Hindu Tamils, Buddhist Sinhalese, and Muslims. At the Cape, Khoikhoi pastoralists and San hunter-gatherers were incorporated into the expanding pastoral economy. In accordance with preexisting practices, these indigenous groups were accorded a great degree of autonomy under their own officials or traditional heads.
All Dutch urban centers and their surroundings were true "slave societies," in which slaves formed a significant proportion of the population (see Table 4). In the late seventeenth century there were about four thousand company slaves and perhaps sixty-six thousand total slaves in the various establishments of the Dutch East Indies, and their numbers increased in the eighteenth century. The Indian sub-continent remained the most important source of forced labor until the 1660s. After 1660 relatively more slaves came from Southeast Asia, while the African mainland, Madagascar, and the Mascarene Islands became a more important catchment area in the eighteenth century. Slaves were general laborers used in a wide variety of occupations. Specialization, however, occurred in accordance with the size of the individual slave household and the particular position of the settlement within the company's overall trade network. The majority of slaves acted as domestic servants, but significant numbers were also employed in agriculture, mining, fishing, shipping, trading, manufacturing, and the service sector.
The End of the Company
Historians have pointed to a number of problems in both Europe and Asia to explain the eventual demise of the company. Scholarship has criticized nontransparent bookkeeping practices, failing entrepreneurship, lesser-quality company servants, lack of coordination between the high government and local company establishments in Asia with the Gentlemen Seventeen, or increasing corruption and private trade of company officials in Asia. By the early twenty-first century, however, company historians qualified these interpretations and stressed several other factors. Among those factors are changes in consumption patterns of Asian products in Europe, declining sales of monopolistic commodities in Asia owing to company price policies, the narrow financial basis of the VOC and the resulting dependency on outside capital, and the disruptions caused by the Fourth Anglo-Dutch War (1780–1784). Similar to the English East India Company some fifty years later, the VOC fell victim to the ongoing processes of territorialization and subsequent rising administrative overhead costs along with the relative decline of the intra-Asian trade partly because of changes in the Asian politico-economic environment and the growing competition of British country traders.
Boxer, Charles R. The Dutch Seaborne Empire, 1600–1800. London and New York, 1965. Classic study of the Dutch East and West Indies, unsurpassed in English.
Bruijn, Jaap R., Femme S. Gaastra, and Ivo Schöffer, eds. Dutch-Asiatic Shipping in the 17th and 18th Centuries. 3 vols. Rijks Geschiedkundige Publicatiën, Grote Serie 165, 166, and 167. The Hague, 1979–1987. Major source of statistical information on the VOC.
Coolhaas, W. Philippus, ed. Generale missiven van gouverneurs-generaal en raden aan Heren XVII der Verenigde Oostindische Compagnie. 9 vols. The Hague, 1960–.
Gaastra, Femme S. De geschiedenis van de VOC. 2nd ed. Zutphen, Netherlands, 1991. Best survey in Dutch on the VOC.
Glamann, Kristof. Dutch-Asiatic Trade, 1620–1740. Copenhagen, 1958. Reprint, The Hague and Copenhagen, 1981.
Idem, "VOC organization." www.tanap.net. Official website of TANAP, Dutch/Asian/South African program and UNESCO support, with background information, bibliography, and numerous links.
Israel, Jonathan. Dutch Primacy in World Trade, 1585–1740. Oxford, 1989. Integrated politico-economic study of Dutch overseas commerce and shipping.
——. The Dutch Republic: Its Rise, Greatness, and Fall, 1477–1806. New York and Oxford, 1995. Best overview of the history of the Dutch Republic from the Burgundian period to the Napoleonic era.
Korte, J. P. de. The Annual Accounting in the VOC, Dutch East India. Amsterdam, 2000.
Landwehr, John. VOC: A Bibliography of Publications Relating to the Dutch East India Company, 1602–1800. Utrecht, 1991. List of all published source materials on the company before modern times.
Meilink-Roelofsz, Marie Antoinette Petronella, Remco Raben, and H. Spijkerman, eds. De archieven van de Verenigde Oostindische Compagnie (1602–1795). The Hague, 1992. Essential inventory of the VOC archives with information on the organization and decisionmaking process of the company.
Shell, Robert Carl-Heinz. "Slavery at the Cape of Good Hope, 1680–1731." Ph. D. diss., Yale University, 1986.
Vink, Markus P. M. "Passes and Protection Rights: The Dutch East India Company as a Redistributive Enterprise in Malacca, 1641–1662." Moyen Orient & Océan Indien 7 (1990): 73–101.
——. "'The World's Oldest Trade': Dutch Slavery and Slave Trade in the Indian Ocean in the Seventeenth Century." Journal of World History 14:2 (2003). Forthcoming.
Vries, Jan de, and Ad van der Woude. The First Modern Economy: Success, Failure, and Perseverance of the Dutch Economy, 1500–1815. Cambridge, U.K., 1997. Successful account of the economic history of the Dutch Republic.
—MARKUS P. M. VINK
Gale Encyclopedia of the Early Modern World:
A market situation in which the product or service of several sellers is sought by only one buyer.
[mon(o)- + Greek opsni, purchase of food; see duopsony.]