CHAPTER II. The Growth of Foreign Trade

THE GROWTH OF FOREIGN TRADE

§ 1. THE EXPANSION OF COMMERCE. THE NEW SPIRIT—Just as the beginning of the sixteenth century marks what may be called an economic revolution in the home industries of the country, so too it marks the beginning of international commerce upon the modern scale. The economic revolution, of which the new agricultural system and the practice of enclosures was the most striking feature, was a change from the old dependent, uncompetitive, and regulated industrial system, to one under {92} which Capital and Labour grew up as separate forces in the form in which we recognize them now. Labour had become nominally independent after the Peasants’ Revolt of 1381, and at the same time it consciously felt that it was in opposition to capitalist and land-owning interests. In its desire for freedom it had also begun to shake off even its self-imposed restrictions, and the power of the gilds had rapidly waned. A new and eager spirit came with the Renaissance and the Reformation, a spirit which on the economic side showed itself in the development of competition, the shaking off of old restraints, and in more daring and far-seeing enterprises. Especially was this the case among the merchants, fired as they were by the great discoveries of the latter end of the fifteenth century, and hence we notice, throughout the sixteenth century and especially at its close, that our foreign trade becomes more extensive than it had ever been before, and the foundations of our present international commerce were securely laid.

§ 2. FOREIGN TRADE IN THE FIFTEENTH CENTURY—At this point we must look back for a moment at our foreign trade before this new epoch. Although our enterprises were by no means large, there was yet a fairly considerable trade done with the countries in the west of Europe—i.e. France, Spain, and the Baltic lands, and especially with the Low Countries. As England was then almost entirely an agricultural country, our chief export was wool for the Flemish looms to work up; but there was also other agricultural produce exported; and likewise some mineral products. In fact England supplied nearly all Western Europe with two most important metals, tin and lead; the former coming chiefly from Cornwall and the latter from Derbyshire, though in neither case exclusively from those counties. Bodmin was, however, the staple town {93} for the export of tin. Our huge mineral wealth in coal and iron was hardly yet touched, even for home use, and none was exported. Our imports were numerous and varied, their number being balanced, as they must always be, by the greater bulk and value of our exports of wool and lead.

A fair amount of trade was done with Portugal and Spain, which sent us iron and war-horses; Gascony and other parts of France sent their wines; rich velvets, linens, and fine cloths were imported from Ghent, Liège, Bruges, and other Flemish manufacturing towns. The ships of the Hanse merchants brought herrings, wax, timber, fur and amber from the Baltic countries; and Genoese traders came with silks and velvets and glass of Italy. And all met one another, as we saw before, in the great fairs, as at Stourbridge, or in the great trading centre of the Western world, London.

§ 3. THE VENETIAN FLEET—But our most important trade in the fourteenth and fifteenth centuries centred round the annual visit of the Venetian fleet to the southern shores of England. This was a great company of trading vessels, which left Venice every year upon a visit to England and Flanders. Our English vessels did not at this time venture into the Mediterranean, and so all the stores of the Southern European countries, and more especially the treasures of the East, came to us through the agency of Venice. Laden with silks, satins, fine damasks and cottons, and other then costly garments, together with rare Eastern spices and precious stones, camphor and saffron, this fleet sailed slowly along the shores of the Mediterranean, trading at the ports of Italy, South France and Spain, till it passed through the Straits of Gibraltar, and at length came up the Channel, and {94} reached our southern ports. When it had reached the Downs, the fleet broke up for a time, some vessels putting in at Sandwich, Rye, and other towns, and a large number stopping at Southampton. Others went on to Flanders. Several days, sometimes weeks, were spent in exchanging their valuable cargoes for English goods, chiefly wool, the balance being paid over in gold, and then the various portions of the great fleet would reunite again, and set sail for Venice, from which they were often absent for nearly a twelvemonth. This annual visit was very convenient for English traders, before our own merchants ventured far away from our coasts. But it is a sign of the increased commercial enterprise of England in the sixteenth century that this visit then became unprofitable, and the last time the Venetian fleet came to our shores was in 1587.

§ 4. THE HANSEATIC LEAGUE’S STATION IN LONDON—While our commerce was, however, not yet so greatly developed, there existed another important institution carried on by foreign merchants, this time from Germany. The Hanse, or Hanseatic League, was started in the twelfth century by some of the leading trading towns of Germany, such as Hamburg and Lübeck, and after a time these towns formed themselves into a League for mutual protection among the constant Continental wars, and became a sort of republic (1241). In another century (by 1360) it had grown so large and powerful that ninety cities belonged to the confederacy, and it had branches or depots in every important town of Northern Europe. Of course there was also a branch at London, in the “Steelyard,” on which spot the Cannon Street Station now stands. This branch had existed from very early times, and a warehouse was there in which the German merchants stored their goods. In Richard II.’s time this building was {95} enlarged, and so it was again in the reign of Edward IV. Round it dwelt the foreign merchants who formed quite a little colony in the very heart of mediæval London. Here they held a kind of chamber of commerce, presided over by an alderman, with two co-assessors, and nine council-men, and meeting regularly on Wednesday mornings in every week. The Steelyard colony existed for some hundreds of years, and taught many valuable commercial lessons to our English merchants. It provided for us a regular supply of the produce of Russia, Germany, and Norway, especially timber and naval stores, and also corn when our English harvest fell short. But as our own merchants grew more prosperous and their commerce extended, they became jealous of the German colony. Attacks were made upon it by London mobs, and Edward VI. actually rescinded its charter. That was the beginning of the end. Mary restored it for a time, but towards the close of Elizabeth’s reign (1597) it was finally abolished. This, too, was another sign of the growth of our own foreign trade.

§ 5. OUR TRADE WITH FLANDERS. ANTWERP IN THE FIFTEENTH AND SIXTEENTH CENTURIES—We have mentioned before how the eastern ports and harbours of England used to swarm with small, light craft that plied all the summer through between our own country and Flanders. We have seen too that this continuous trade was due to the fact that we supplied the Flemish looms with wool. Up to the fifteenth century the great Flemish emporium, to which our English ships plied, was Bruges, but in the sixteenth century this town quite lost its former glory, and Antwerp took its place. The change was due to the action of Maximilian, the Emperor of Germany, to whom Henry VIII. was allied, and who, in revenge for a rebellion in which Ghent and Bruges took part, caused the canal {96} which connected Bruges with the sea to be blocked up at Sluys (1482), and thus English and other ships were compelled to direct their course to Antwerp, which then became a great and flourishing port. Antwerp remained without a rival till near the close of the sixteenth century, and every nation had its representatives there. Our own consul, to use a modern term, was, at the close of the fifteenth century, Sir Richard Gresham; and later, in the reign of Henry VIII., his celebrated son, the financier and economist, Sir Thomas Gresham. The fact of our having these representatives there is again a proof of the growth of trade in the sixteenth century. An Italian author, Ludovico Guicciardini (who died in 1589), gives a very precise account of our own commerce with Antwerp at this period, and it is interesting to note how varied our commerce has by this time become. This is what he says as to our imports: “To England Antwerp sends jewels, precious stones, silver bullion, quicksilver, wrought silks, gold and silver cloth and thread, camlets, grograms, spices, drugs, sugar, cotton, cummin, linens fine and coarse, serges, tapestry, madder, hops in great quantities, glass, salt, fish, metallic and other merceries of all sorts; arms of all kinds, ammunition for war, and household furniture.” As to our exports he tells us: “From England Antwerp receives vast quantities of coarse and fine draperies, fringes and all other things of that kind to a great value; the finest wool; excellent saffron, but in small quantities; much lead and tin; sheep and rabbit skins without number, and various other sorts of the fine peltry (i.e. skins) and leather; beer, cheese, and other provisions in great quantities; also Malmsey wines, which the English import from Candia. It is marvellous to think of the vast quantity of drapery sent by the English into the Netherlands.” {97}

This list is sufficient to show an extensive trade, and we shall comment upon one or two items of it in the next chapter. Here we need only remark upon the great growth of English manufactures of cloth.

§ 6. THE DECAY OF ANTWERP AND RISE OF LONDON AS THE WESTERN EMPORIUM—But the prosperity of Antwerp did not last quite a century. Like all Flemish towns it suffered severely under the Spanish invasion, and the persecutions of the notorious Alva. In 1567 it was ruinously sacked, and its commerce was forced into new channels, and the disaster was completed by the sacking of the town again in 1585. Antwerp’s ruin was London’s gain. Even in 1567, at the time of the first sacking, many Protestant Flemish merchants fled to England, where, as Sir Thomas Gresham promised them, they found peace and welcome, and in their turn gave a great impulse to English commercial prosperity. Throughout Elizabeth’s reign, in fact, there was a continual influx of Protestant refugees to our shores, and Elizabeth and her statesmen had the sagacity to encourage these industrious and wealthy immigrants. Besides aiding our manufactures, as we shall see later, they aided our commerce. In 1588 there were 38 Flemish merchants established in London, who subscribed £5000 towards the defence of England against the Spanish Armada. The greatness of Antwerp was transferred to London, and although Amsterdam also gained additional importance in Holland, London now took the foremost position as the general mart of Europe, where the new treasures of the two Americas were found side by side with the products of Europe and the East.

§ 7. THE MERCHANTS AND SEA-CAPTAINS OF THE ELIZABETHAN AGE IN THE NEW WORLD—It is thus of interest to note how the great Reformation conflict between Roman Catholic and Protestant in Europe resulted in the commercial {98} greatness of England. Interesting, also, is the story of the expansion of commerce in the New World, owing to the attacks of the great old sea-captains, Drake, Frobisher, and Raleigh, upon the huge Catholic power of Spain. These attacks were perhaps not much more than buccaneering exploits, but the leaders of them firmly believed that they were doing a good service to the cause of Protestantism and freedom by wounding Spain wherever they could. And possibly they were right. Their wondrous voyages stimulated others, likewise, to set out on far and venturesome expeditions. Men dreamt of a northern passage to India, and although Willoughby’s expedition failed, one of his ships under Richard Chancellor reached Archangel, and thus opened up a direct trade with Russia; so that in 1554 a company was formed specially for this trade. It was, too, in Elizabeth’s reign that the merchants of Southampton entered upon the trade with the coast of Guinea, and gained much wealth from its gold-dust and ivory. Sir John Hawkins engaged in the slave-trade between Africa and the new fields of labour in America. Bristol fishermen sailed across the dreaded Atlantic to the cod-fisheries off Newfoundland, and at the close of Elizabeth’s reign English ships began to rival the Portuguese in the Polar whale-fisheries.

This reign witnessed also the rise of the great commercial Companies. The company of Merchant Adventurers had indeed existed since Henry VII.’s time, having been formed in imitation of the Hanseatic League. The Russian Company of 1554 was formed upon the model of this earlier company; and then came the foundation of the great East India Company. It was due to the results of Drake’s far-famed voyage round the world, which took three years, 1577–80. Shortly after {99} his return it was proposed to found “a company for such as trade beyond the equinoctial line,” but a long delay took place, and finally a company was incorporated for the more definite object of trading with the East Indies. The date of this famous incorporation was 1600, and in 1601 Captain Lancaster made the first regular trading voyage on its behalf. To this modest beginning we owe our present Indian Empire.

§ 8. REMARKS ON THE SIGNS AND CAUSES OF THE EXPANSION OF TRADE—Now, if we look at the broad features that mark the growth of sixteenth century trade, we shall see that it was closely connected with England’s decision to abide by the Protestant cause. It was that which won her the friendship of the Flemish merchants; it was the religious disturbances in Flanders that gained for London the commercial supremacy of Europe; it was our quarrel with Roman Catholic Spain that inspired the voyages of Drake and Hawkins, and thus caused others to venture forth into new and perilous seas, over which in course of time the English merchants sailed almost without a rival. And, as we have shown, the signs of the expansion of England are seen in the fall of the Hanse settlement in London, and the stoppage of the visits of the Venetian fleet. On the other hand the rapid growth of the port of Bristol in the west witnessed to fresh trade with the New World; and the rise of Boston and Hull on the east coast is significant as showing the development of our Northern and Baltic trade, even to the extent of rivalling the great Hanse towns. A great stimulus had arisen, and England was now taking a leading position among the nations of the world. It is now our business to survey it as it existed in the time of Elizabeth.

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