Chapter 3: Trade and commerce Flashcards
Why did free trade dominate British economics
Adam smiths book ‘the wealth of nations’ argued that freedom from commercial restrictions was the only way to maximise prosperity
Britain was the worlds foremost trading nation so maximised from free trade
Britain was able to enforce free trade using the navy eg Opium wars and Mexico
Idea of free trade linked to idea of British as liberators - attack on slave trade and free labour
What were the consequences of free trade
Allowed imperial trade to grow massively - 20% food and raw material imports came from empire and 1/3 of manufactured goods were exported back to Empire
London became the capital of trade and sterling became the main currency of trade
Technological improvements supported trade eg telegraph lines, railways and improved refrigeration
How did the infrastructure of trade support the development of empire - ships
Clipper ships were fast ships suited to low volume high profit goods - they allowed opium, tea and spices to be quickly transported
Steamships carried heavy bulky goods and were more effective as they didn’t rely on win or currents - allowed Britain to travel up rivers and reach previously inaccessible countries eg Niger
How did the infrastructure of trade support the development of Empire - railways
Allowed Australia to export wool and wheat, offered South Africa a chance to expand into further territories
In India the railways linked cotton and jute growing areas of the north with the mills of Bombay and allowed rice to reach ports for exports
Indian railways created a market for Britain as most engineers and parts were British
In West Africa it provided a link between production and the sea
70% of British investment was in transport infrastructure
How did the infrastructure of trade support the development of Empire - Canals and rivers
Provided a means of transport for trading purposes and were explorers main focus
Canals were built to avoid hazardous water stretches
Canals were developed on a huge stage in India from 1857
In Canada after 1867 canals were deepened
What goods did Britain get from its colonies - agriculture
Canada, Australia and New Zealand had vast land permitting the production of cheap foodstuffs and raw materials at a lower price than Europe
Tropical colonies eg South Africa produced goods that weren’t available in Britain eg sugar, coffee, cocoa
Britain ran its own plantations and transported Indian coolies to work their - paid low wages
What goods did Britain get from its colonies - mineral goods
Tin in Nigeria, gold in Gold Coast and diamonds in Sierra Leone
Gold deposits found in Africa in 1886 - over 30,000 skilled British miners travelled to Transvaal to work in the old mines
Gold discovered in New South Wales and Victoria (producing £124m of gold or 1/3 of worlds production)
Examples trade and commerce with empire was important to Britain
British financiers made investments in the colonies
Between 1850-75 20% of all imports cam from colonies - Empire provided raw material and foodstuffs needed by British industry
Between 1850-75 1/3 of all exports when to colonies - Empire provided markets for British industries
Tropical colonies produced goods not available in Britain that had high profit eg cocoa
Value of British imports of raw cotton from India raised from £1.6m in 1854 to £5.8m in 1876
Examples trade and commerce with empire was less important to Britain
British financiers invested heavily in other countries part of the informal empire
Britain didn’t have to worry about threats to free trade
Trade outside the empire was far greater than trade within it
Some of the new African colonies had very little economic value
Several self governing bodies introduced tarriffs to protect themselves against British manufactures eg Canada 1859
Ways in which trade and commerce benefited Indigenous people
It provided benefits no other power could match and to which colonies would not have had the same access to if they weren’t in the Empire
Britain was the world leading source of technology
Britain provided every economic service colonies may need
Britain was the key to establish profitable export staples which provided the resources that could be used to create an effective infrastructure
Trade created jobs in plantations and mines
Railways in India were developed
Ways in which trade and commerce negatively effected indigenous people
Individual beings do not live by the free trade market so did not see benefits
The immediate effect of imperial free trade was often the collapse of local indigenous manufacturing industries eg Indian cotton mills
This led to the destruction of livelihoods
Britain did not invest in other manufacturing industries because they wanted to limit competition
They were paid low wages for long hours however so were people in Britain
How was Naval power important to Britain in the 19th century
The British navy was by far the biggest giving it supremacy
They had a growing number of small ships allowing them to penetrate coastal areas that were previously inaccessible allowing Britain to exert power across the world
There navy allowed Britain to use military force were necessary to gain benefits eg opium wars, Mexico
Ships were often used to eradicate slave trade and piracy
A growing concern about naval weakness led to a large shipbuilding programme in 1889 where the gun battle fleet superseded the gunboat navy
This disguised Britains maritime decline
What were chartered companies
Commercial organisations that were granted privileges, status and legal rights by the government
What was the Imperial Federation League
Founded in 1884 to promote colonial unity and support for Chartered companies
It rapidly established branches throughout the country to try and attract support from the business community
Why did chartered companies become important again in the 1870s
Britains economic supremacy became challenged by European and American industry and the onset of a depression
Chartered companies revived a way of extending Britains trade and control
