1.3 - Trade and Commerce 1857-1890 Flashcards
What is trade?
The buying and selling of goods e.g. raw materials
Trade is a fundamental economic activity that includes various forms of exchanging goods and services.
Define commerce.
Activities that help facilitate the exchange of goods from products or manufacture to markets.
Commerce includes transporting, banking, insurance, and warehousing.
What is mercantilism?
A system of regulations governing trade whereby colonies had been obliged to send most of their produce to Britain.
It involved buying British manufactured goods and using British ships for imports and exports.
What is free trade?
Trade left to its natural course without tariffs, quotas, or other restrictions.
Why did free trade come to dominate economic thinking in the 19th century?
Mercantilism was dismantled under the influence of new theories of ‘free trade’ advocated by Adam Smith.
Smith argued that wealth was indefinitely expandable and freedom from commercial restrictions maximized prosperity.
What role did Britain play in promoting free trade?
Britain was the world’s foremost trading nation, actively supporting free trade agreements and using threats to achieve them.
What were the consequences of free trade for British colonies?
Trading patterns became well established; borrowing in London capital markets was cheaper; free trade saw imperial trade and investment grow.
Approximately 20% of foodstuffs and raw materials came from British colonies.
What technological improvements supported the growth in trade?
Innovation in banking, shipbuilding, telegraph lines, railways, and refrigeration.
What was the impact of steamships on trade?
Steamships increased cargo capacity, could travel faster, and extended Britain’s reach into previously inaccessible countries.
What was the significance of railways in the British Empire?
Railways ensured British control and opened new areas for economic development.
They linked production areas to markets and were a major investment in self-governing colonies.
How did canals support trade?
Canals provided important means of transport for trading purposes and were developed to avoid hazardous stretches of water.
What agricultural goods did Britain import from its colonies?
Cheap foodstuffs and raw materials such as wool, sugar, coffee, cocoa, and palm oil.
Tropical colonies produced goods not available in Britain.
What mineral goods were sourced from British colonies?
Tin, gold, diamonds, copper, coal.
Gold deposits in South Africa prompted a gold rush, increasing British ambitions in the area.
Fill in the blank: In 1886, gold deposits were found in ______, prompting a gold rush.
Transvaal
True or False: Free trade led to the establishment of London’s financial capital.
True
What percentage of British exports went to its Empire?
Approximately 1/3
What did the introduction of railways in India achieve?
Linked cotton and jute growing areas to mills and enabled rice exports.
Railways were built for strategic purposes.
What percentage of all imports came from colonies between 1850-1875?
20%
The Empire provided raw materials and foodstuffs needed by British industries.
What fraction of all exports went to the colonies between 1850-1875?
1/3
The Empire provided markets for British industries.
Which country was essential to Britain’s economy?
India
What valuable resources did tropical African colonies provide?
Agricultural materials, foodstuffs, and minerals
What high-profit goods were produced in tropical colonies?
Cocoa and coffee
What was the increase in value of British imports of raw cotton from India from 1854 to 1876?
From £1.6 million to £5.8 million
What types of precious materials were mined that brought wealth to Britain?
Gold and diamonds
What was one immediate impact of imperial free trade on indigenous manufacturing?
Collapse of local industries
What did Britain not invest in to limit competition?
Other manufacturing industries
What was the British Navy’s status in the 19th century?
The biggest in the world
What did the growing number of smaller ships allow Britain to do?
Penetrate coastal areas previously inaccessible
What military actions did the British Navy enable to protect British interests?
Naval bombardments, seizure of ships, land raids, punitive expeditions
What was the concern regarding naval power in the 1880s?
Growing concern about naval weakness
What are Chartered Companies?
Commercial organisations granted privileges by the government
What did chartered companies often have that prevented competition?
Monopolies
What led to the decline of chartered companies in the 1850s?
The advent of free trade and the Indian mutiny
What economic challenges did Britain face in the 1870s that revived the idea of Chartered Companies?
European and American industrialisation and economic depression
What was the purpose of the Imperial Federation League founded in 1884?
To promote colonial unity and support for Chartered Companies
What company received a charter in 1881 to administer North Borneo?
North Borneo Trading Company (NBTC)
The company was instrumental in the administration and development of the territory.
What natural resources were found in North Borneo that benefitted the NBTC?
Coal, iron, copper, coffee, and tobacco
These resources were crucial for trade and economic development.
Why was North Borneo strategically important for Britain?
It was a key site in the South China Sea and a midpoint between India and Hong Kong
Who were the main figures associated with the North Borneo Trading Company?
Alfred and Edward Dent
What military group did the NBTC use to establish control in the area?
Sikh soldiers
What significant changes did the NBTC implement in Borneo?
Removed slavery and built railways
What happened to Borneo during WWII, and how did Britain respond?
Borneo suffered badly, leading Britain to take over to fund repairs
What was the original name of the Royal Niger Company?
United Africa Company
Who founded the Royal Niger Company and when was its charter granted?
George Goldie; charter granted in 1886
What was the main area of interest for the Royal Niger Company?
Niger River basin in West Africa
What were the primary trade goods for the Royal Niger Company?
Palm oil and cocoa
How many treaties did the Royal Niger Company make with local chiefs?
Over 400 treaties
True or False: The Royal Niger Company eliminated competing firms by introducing large tariffs and licensing fees.
True
What was the fate of the Royal Niger Company’s charter?
Revoked in 1900
What was the Imperial British East Africa Company’s charter response to?
Growing German interest in East Africa
Who founded the Imperial British East Africa Company?
William Mackinnon
What were the primary areas of interest for the Imperial British East Africa Company?
Uganda, Kenya, and Zanzibar
What was the Imperial British East Africa Company’s aim regarding local chiefs?
To build trade and open new markets
Fill in the blank: The Imperial British East Africa Company made plans to build a _____ to improve trade.
railway
What year was the charter of the Imperial British East Africa Company revoked?
1894
What prompted the formation of the British South Africa Company?
Success of the Royal Niger Company and desire for mineral wealth
Who was the influential figure behind the British South Africa Company?
Cecil Rhodes
What areas did the British South Africa Company primarily focus on?
Lands north of the Cape Colony and the Boer republic of the Transvaal
What resources did the British South Africa Company hope to mine?
Gold, diamonds, coal, copper, and iron ore
What military action did the British South Africa Company take to secure interests?
A ‘Pioneer Column’ marched into native lands
What significant deal did Rhodes make in 1888?
Mining rights deal with King Lobengula
What was the outcome of the Battle of Shangani River?
Establishment of British dominance
Fill in the blank: The areas seized by the British South Africa Company eventually became the colony of _____
Rhodesia (Zimbabwe)
