3 - The European trading companies: exports from Europe and the generation of purchasing power in Asia

Summary

The early years of the seventeenth century mark a sharp discontinuity in the volume and the value of the seaborne trade between Asia and Europe. This was the direct outcome of the successful challenge by the Dutch and the English of the Portuguese monopoly of this trade. The lead provided by these two countries was followed almost immediately by the Danes, though on a very modest scale, and, later in the century, by the French. The first half of the eighteenth century also witnessed the entry into the fray of motley groups of merchants from Ostend and other places trying to find ways and means of evading the great East India Companies' monopoly of this trade. On the whole, the two centuries witnessed not only a tremendous expansion in the volume and the value of the Euro-Asian trade, but also an enormous diversification in the composition as well as the origin of the cargo arriving from Asia into the ports of northwestern Europe. A related development was the near-wiping out early in the seventeenth century of the water-cum-land route between the two continents that had been in use for centuries.

THE DUTCH EAST INDIA COMPANY

The Dutch East India Company was founded in 1602 by a charter granted by the States-General, the national administrative body of the Dutch Republic. We have already noted that the Euro-Asian trade in pepper carried on by the Portuguese was running into serious problems in the last quarter of the sixteenth century.