The Dutch East India Company was a joint stock company who monopolized the spice trade of the 17th century. They established trading ports all over Asia.
The 17th Century was a golden age for the Dutch. Amsterdam was a major commercial center, while the Bank of Amsterdam served as the clearinghouse for credit transactions throughout Northern Europe. The Dutch controlled trade routes in the Baltic and the North Sea. With the formation of the Dutch East India Company in 1602, the Dutch revolutionized global trade, establishing factories, ports and settlements all over the Pacific.
First Multinational Joint Stock Company
The Dutch East India Company was a first of its kind in Northern Europe, having taken trade routes away from the Germanic Hanseatic League. It was a joint stock company formed by investors. This type of company had been used somewhat in Italy. But in Spain and Portugal, the leading countries of exploration at the time, it was unheard of.
The Dutch had already had great success trading in and around Europe. They bought goods in bulk and could rarely be undersold by competitors. Building on this success, the Dutch East India Company sought a way to bypass the Portuguese stronghold on the spice trade with the Far East. To help make their trading more efficient (something the Portugese weren’t) the Dutch set up factories in Bandar, on the Persian Gulf, and in Bantam on the Malay Archipelago. They also had a factory at Zeelander (modern day Taiwan) but were expelled by Chinese forces in 1662. By 1620, the Dutch East India Company was the biggest trading corporation in all of Europe and a force to be reckoned with.
The Dutch East India Company Expands
In 1652 the Dutch set up a refueling station on the tip of Africa, at the Cape of Good Hope. The Dutch had also muscled the Portuguese out of several of their ports and holdings in India and the Malay Archipelago. Their headquarters were strategically placed at Batavia, on the Malay Archipelago. In 1641 they took Malacca from the Portuguese. In 1656 they set up a station in Chinsura, Benegal. That same year they also took Colombo (located on Sri Lanka) from the Portuguese. This was followed by the establishment of a harbor at Malabar in India in 1663. In 1669 a Dutch fleet took Macassar, on the Malay Archipelago, making its sultan a Dutch vassal.
In China, the Dutch along with other European powers, traded at Canton. In Japan, the Dutch had exclusive rights to trade at Nagasaki after 1639.
The Dutch Monopolize the Spice Trade
The demand for spices in Europe had continued to increase throughout the 16th and early 17th Century. At the start of the 1600s, the Portuguese were the only European country who imported spices from the Far East. It wasn’t long before the Dutch ousted the Portuguese from the Spice Islands and became the exclusive supplier of spices to Europe.
End of the Dutch Golden Age
The Dutch East India Company peaked in 1669, when they employed over 10,000 soldiers, 40 warships and 150 merchant ships. Internal struggles, coupled with unrest in their settlements led to a decline for the joint stock company. At the same time, both England and France were growing in power and establishing more oversea colonies. By the end of the 18th Century the Dutch could no longer keep the English and French at bay in the Far East and the company was dissolved.
Sources:
Barraclough, Geoffrey. Atlas of World History. Ann Arbor: Harper Collins, 2001.
Burns, Ralph, Lerner, Meacham. World Civilizations, Sixth Edition. New York: W.W. Norton & Company, 1982.
Lang, Sean. European History for Dummies. West Sussex: John Wiley & Sons, 2006.
