The Dutch Trade Area of the East Indies in the Mid-seventeenth Century

Abstract

It is a well-known fact that the Dutch people were the most active in the world trade in the mid-seventeenth century. For their East Indian trade they established the Dutch East India Company which was granted the monopoly of the trade by the Dutch Government. Their main purpose was to obtain pepper and other spices, the most important trade articles at that time, in the East Indies and supply them to the Western Europe where there was a great demand for them.
Encountering strong resistance of trade enemies, such as Portuguese, English and even natives there, the Dutch had been extending the area of their trade gradually and in 1650 it covered from Mocha in Arabia through Persia, India, Siam, China, Taiwan to Japan. This area was not “un espace homogene” but “un espace polarisée”.
The whole business was managed by the supreme organization named “Heeren XVII”(Seventeen Gentlemen) at the head office in Amsterdam. In the East Indies “Gouveneur-Generaal”(Governor-General) at the main office in Batavia supervised all the factories which were located in the main trading posts there. They tried to sell the goods imported from Batavia at the highest possible prices and, in return, obtain the produces in demand as much as possible and ship them to Batavia.
At the port of Batavia her traffic was heavy with ports located in Java, Sumatra, etc. But the vessels used there were small-sized, while those used for the Netherlands or Japan were pretty large-sized. So the volume of her trade with each port is hard to be estimated only by the numbers of the vessels in-and-out the port of Batavia. There was traffic throughout the year between Batavia and ports in Java and Sumatra, but her traffic with the Netherlands or Japan was seasonally restricted, as the ocean-going sailing boats had to rely mostly on the Monsoon in the ocean.(Ref. Table 1).
Table 2 shows the names of the articles arrived at or left the port of Batavia in 1636. The majority of the imported goods were re-exported from Batavia; pepper and other spices being shipped for the Netherlands and the Chinese manufactures and the Indian cotton textiles for many other places in the East Indies. In order to obtain spices in Molucca Islands, the Dutch had to deliver the goods demanded by the natives, since the money was not used in transaction by them. So the Dutch tried hard to obtain the necessary goods somewhere else in the East Indies. Consequently, the trade among the countries in the East Indies was also important to the Dutch in addition to the trade with their homeland.
In Table 3 are listed the names of the main factories with their respective business results. Not all factories could make profit. It looks that the factories which were more active in importation than in exportation made good profit in general.
The Dutch trade in the East Indies seems not always so profitable as is usually considered. As shown in Table 4, the ratio of the profit to the East Indian capital (investment) was only 10% or less. There was, what is worse, some loss caused by the “perils of the seas”. and yet no insurance was covered on shipment at all. Therefore, their trade was very risky at that time.
It must be mentioned that the trade was operated by a kind of “Barter” system, bringing the goods to the East Indies and, in return, collecting the produces as much as possible for the European market.
Finally their trade began to decrease and the English people came to take over the Dutch trade area, when the main trade articles changed from pepper and other spices to cotton textile around the end of the seventeenth century.