DUTCH, THE SPICE TRADE AND THE WEALTH GENERATED FROM IT

DUTCH AND THE SPICE TRADE

The Dutch established a monopoly on the spice trade from the Moluccas . They gained control over the clove trade through an alliance with the sultan of Ternate in the Moluccas in 1607. Dutch occupation of the Bandas from 1609 to 1623 gave them control of the nutmeg trade. Dutch control of the region was fully realized when Melaku was captured from the Portuguese in 1641.

On the Banda Islands, the Dutch tried to trade knives, woolen clothes and other things that the Banda islander didn’t need. The Dutch demanded that they be given a monopoly and found a few complaint chiefs that signed “contracts” promising them their desired monopoly. In the meantime the English had arrived in the area and they and the Dutch tried to outmaneuver one another for control of the islands.

The Dutch could be quite ruthless when it suited their purposes. In the Bandas, one governor-general beheaded and quartered 44 local chiefs and displayed the remains in 1621 at a fort after Dutch “negotiators” were killed in a dispute over the placement of a fort on sacred site. See Jan Pieterszoon Coen Below.

In what today is eastern Indonesia, the VOC with the help of indigenous allies fundamentally altered the terms of the traditional spice trade between 1610 and 1680 by forcibly limiting the number of nutmeg and clove trees, ruthlessly controlling the populations that grew and prepared the spices for the market, and aggressively using treaties and military means to establish VOC hegemony in the trade. One result of these policies, exacerbated by the late-seventeenth-century fall in the global demand for spices, was an overall decline in regional trade, an economic weakening that affected the VOC itself as well as indigenous states, and in many areas occasioned a withdrawal from commercial activity. [Source: Library of Congress]

Dutch Ships and Sea Routes to Indonesia

The Dutch developed quicker and more efficient southern routes between the South Africa and Indonesia that were more efficient and profitable than ones used by the Portuguese, who followed slower, seasonal coastal routes via India, and the Spanish, who wet the long way around via the Pacific and Mexico.

Holland was the world's leader in map making. The VOC hired the best mapmakers in the Netherlands to make "secret atlases" for their exclusive use. The company possessed 180 maps and charts that showed the best routes around Africa to India, China, Japan and the East Indies. The owners of the company denied the existence of the maps which were not made public until some of them were mistakenly found their into the library of Austrian aristocrat.

In the 17th century oak forests in Poland were cleared to supply wood for Dutch ships used in voyages to the East Indies, About 4,000 planks were needed for each, which lasted only one or two voyages before the wood rotted and the ship fell apart.

The Flying Dutchman was Dutch East Indies ship destroyed by a fierce storm near the Cape of Good Hope in 1680. A ghost version of ship has reportedly been seen several times. In March, 1939, for example, about 60 people on Glencairn beach in South Africa reportedly saw a 17th century ship sail towards a sandbar and then disappear. The Flying Dutchman was immortalized by a Wagner opera.

Jan Pieterszoon Coen and Ruthless Dutch Policies to Control the Spice Trade

The most influential and dynamic Dutch ruler in the early years of Dutch control of Indonesia was Jan Pieterszoon Coen, the governor general of the VOC from 1619 to 1623 and again from 1627 to 1629. Among other things he nearly wiped out the entire native population of the Banda Islands in Moluccas to keep the spice trade secret and under control; and aimed to make Jakarta into the main trading port of Asia. The latter was never realized but he is credited with instituting policies that enabled the Dutch to establish their monopoly in the spice trade in Indonesia.

Coen seized the port of Jayakarta (modern Jakarta) from the sultan of Banten in western Java and established the trading post at Sunda Kelapa. Since then, it has served as the capital of the VOC, of the Netherlands Indies after 1816, and of the independent Indonesian state after World War II. Coen also developed a plan to create spice plantations using Burmese, Madagascan and Chinese labourers. Although this plan was not realized in his lifetime it too became an important aspect of the Dutch occupation of Indonesia later on.

Coen was determined to go to almost any lengths to establish and reserve a VOC monopoly of the spice trade. He accomplished his goal by both controlling output and keeping non-VOC traders out of the islands. Ambon had been seized from the Portuguese in 1605, and anti-Iberian alliances were made with several local rulers. However, the English East India Company, established in 1600, proved to be a tenacious competitor. When the people of the small Banda archipelago south of the Malukus continued to sell nutmeg and mace to English merchants, the Dutch killed or deported virtually the entire population and repopulated the islands with VOC indentured servants and slaves who worked in the nutmeg groves.

Similar policies were used by Coen's successors against the inhabitants of the clove-rich Hoamoal Peninsula on the island of Ceram in 1656. The Spanish were forced out of Tidore and Ternate in 1663. The Makassarese sultan of Gowa in southern Sulawesi, a troublesome practitioner of free trade, was overthrown with the aid of a neighboring ruler in 1669. The Dutch built fortresses on the site of the Gowa capital of Makassar (modern Ujungpandang) and at Manado in northern Sulawesi and expelled all foreign merchants. In 1659 the Dutch burned the port city of Palembang on Sumatra, ancient site of the Srivijaya empire, in order to secure control of the pepper trade. *

Dutch Global Empire

In the 17th century, Holland controlled an empire that embraced three of the four main continents and held sway over 80 million people. Despite this the Dutch were quite skilled at avoiding trouble. They were usually not involved in the wars that besieged France, Spain and England.

In Asia, the Dutch moved in and took possession of many of the Portuguese forts by force, which in turn were later taken away from them by the English. Outside of Asia many Dutchmen were slave traders. The West India Company had a monopoly on the lucrative trade for slaves to the Caribbean from Angola, a Portuguese colony where many slaves originated.

In the early 16th century, the Dutch scored important victories against the Spanish. In 1628 the Naval commander Piet Hein was greeted with a hero's welcome after he captured the Spanish Silver Fleet off the coast of Cuba.In the 17th century Britain and the Netherlands fought with each other for control of the world's seas over three periods (1652-54, 1665-67 and 1672-74). British and Dutch ships found one in waters off of Europe, the West Indies and Asia. The Three Days Battle off southern England (1652) resulted in the loss of 20 Dutch ships and the death of 3000 men. In 1672, King Louis XIV invaded the Netherlands. The Dutch, allied with Britain, attacked by the sea and forced the French to withdraw in 1674. The French later defeated the Dutch in the Mediterranean and the Dutch and English formed an alliance that was solidified with William III of Orange marrying Mary, daughter of King James III of England. In 1689, he became the King of England when James was dethroned.

Dutch Golden Age and Tulipmania

The Dutch Golden Age began after the Spanish were thrown out, the majority of population had converted from Catholicism to Calvinism, and money started to come in from its overseas colonies. Alan Riding of the New York Times wrote, "It was special time in Dutch history, characterized by political enlightenment and economic prosperity. Amsterdam grew from 31,000 people in 1578 to 200,000 in 1650. The Amsterdam stock exchange, the world's oldest, was founded in 1602.

The mercantile materialists who made a fortune in the Golden Age were called liefhebbers (meaning "those who love to have"). They bought wonderful brick houses along the canals of Amsterdam, patronized artists like Rembrandt, Rubens and Van Dyck and took pride in displaying their unique possessions in curiosity cabinets (the forerunners of museums).Men dressed as they were depicted in Rembrandt painting in black satin suits, frilly lace collars and wide brimmed hats.

Unlike wealthy upwardly British merchants, who spent their money on large estates, the Dutch burghers stayed in the cities, if for no other reason that land was scarce in Holland and it often flooded. They concentrated their wealth on smaller spaces and also seemed very interested in science and knowledge. Among the items displayed in the curiosity cabinets were fleas, glasses, astrolabes from Italy, nautilus shells from the Philippines, coral spoons, ivory flutes, coconut shell cups, microscopes, telescopes, armillary spheres, exotic seashells, rhino horns, elephant teeth. ostrich eggs and Roman coins. They also collected Turkish rugs, Greek marbles and trained monkeys and other curious pets. In 1615 a "scholars privileges" included a generous allowance of beer and wine. Paintings of well-dressed prostitutes were often displayed in prominent places in people's homes.

In the 1630s the Dutch became so enraptured with tulips that huge prices were spent on them; tulips became a symbol of wealth; and a highly speculative market grew up in which bulbs were bought and sold before they bloomed in a manner that was not unlike today’s Futures market. “Tulipmania” spawned tulip analysts, special stock markets that dealt with trading tulips, and firms that specialized in insuring, storing, shipping and packing the flowers. "In 1634," Charles Mackay wrote in Extraordinary Popular Delusions & the Madness of Crowds, "the rage among the Dutch to possess (tulips) was so great that the ordinary industry in the country was neglected."

Between 1634 and 1637 speculation on tulips reached such a level it almost bankrupted the country. Individual bulbs for tulips of extraordinary color and patterns sometimes sold for as much $10,000 in today's money. A sailor who accidently ate an extremely valuable bulb for breakfast, thinking it was an onion, was jailed jail on felony theft charges. A rich man paid 8,000 pounds of wheat, 16,000 pounds of rye, 4 oxen, 8 pigs, 12 sheep, 2 hogsheads of wine, 1,000 gallons of beer, 1,000 pounds of cheese, a braed, a suit if clothes and a silver drinking cup for one rare variety of a tulip called a "Viceroy."

To keep prices climbing some speculators released chickens, pigs and dogs in tulip fields to destroy tulip crops thereby increasing the value of their own bulbs. They also cornered the market of of valuable bulbs and then spread rumors the crops had been wiped out to cause panic buying of remaining bulbs. Finally the tulip bubble collapsed and many people lost their shirt

Book: Embarrassment of Riches by Simon Schama is "lavish study of the Netherlands during the Golden Age."

Spice Wars and and the Nutmeg Trade

The Dutch monopolized the nutmeg trade and kept it centered in the Moluccas. They went through great lengths to preserve their monopoly. During the Spice Wars of the 17th and 18th century the Dutch uprooted groves of nutmeg and cloves trees to keep prices high and cut their competitors out of the market. Dutch settlers were given slaves to run their plantations but were told they could not return home to Holland and were required to produce cloves exclusively for the VOC at fixed prices. Seventy large plantations were established mostly on Banda and Ai islands.

The Dutch exterminated natives unwilling to cooperate with them and burned piles of nutmeg after bumper harvests to keep prices high. They also soaked nutmeg seeds in lime so no one could plant them without their authorization. This plan was thwarted when fruit pigeons carried nutmeg seeds to other islands. To keep their monopoly intact the Dutch sent out teams to track down and destroy every last plant.

At the time the Dutch controlled the trade nutmeg was the most valuable commodity in the world after gold and silver. In the early 17th century ten pounds of nutmeg could be purchased for less than an English penny in the Banda Islanda and resold in Europe for over two pounds, a mark up of over 60,000 percent. In addition to a being a flavoring nutmeg was valued as a preservative and medicine and was said to ward off the plague.

As part of the solution to the “spice war” the 1667 Treaty of Breda was signed in which the English dropped their claim to the Bandas, where nutmeg was grown. As part of the deal the English exchanged Pulau Run, a tiny islet in the Spice Islands, for Manhattan (then known as New Amsterdam), which the Dutch had famously obtained by trading $24 worth of beads and trinkets in 1627.

The Dutch–English War of 1780, broke the VOC’s spice-trade monopoly with the Treaty of Paris, which permitted free trade in the East.

End of the Dutch Monopoly on the Nutmeg Trade

The Dutch maintained their monopoly on the nutmeg trade for two and half centuries, until the late 18th century when a French missionary smuggled nutmeg seedlings out of the Dutch East Indies and they were replanted in Madagascar, Mauritius and Zanzibar. With is move the Dutch spice monopoly was broken and the Moluccans were largely forgotten.

When the British took over the Moluccas for 12 years at the turn of the 19th century to counter the annexation of Holland by Napoleon they spread the cultivation of nutmeg to the Caribbean. By the time the Dutch reclaimed Indonesia in return for letting the British have Malaysia the damage had been done. By this time nutmeg had lost its luster anyway as its health benefits were questioned and refrigeration reduced demand for it as a preservative.

Cultivation in Grenada in the Caribbean became so big the island designed its flag with the green, yellow and red colors of the nutmeg seed and placed am image of a nutmeg seed on one side. Today, nutmeg production has dropped in the Bandas to the point there are worries it might disappear.

Image Sources:

Text Sources: New York Times, Washington Post, Los Angeles Times, Times of London, Lonely Planet Guides, Library of Congress, Compton’s Encyclopedia, The Guardian, National Geographic, Smithsonian magazine, The New Yorker, Time, Newsweek, Reuters, AP, AFP, Wall Street Journal, The Atlantic Monthly, The Economist, Global Viewpoint (Christian Science Monitor), Foreign Policy, Wikipedia, BBC, CNN, NBC News, Fox News and various books and other publications.

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© 2008 Jeffrey Hays

Last updated June 2015

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