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From Growth to Collapse: Portugal, Brazil, and the Breakdown of the Old Colonial System (1760-1830)

2000; Duke University Press; Volume: 80; Issue: 4 Linguagem: Inglês

10.1215/00182168-80-4-839

1527-1900

Jorge M. Pedreira,

Colonialism, slavery, and trade

The breakdown of the Portuguese-Brazilian empire has been a topic of controversy for a long time. The dispute has converged on matters of fact as much as on matters of interpretation. Historians on both shores of the Atlantic have failed to present a common perspective on basic issues, such as the nature and scope of the growth that preceded the collapse, or the timing, duration, and intensity of the crisis itself. Thus a variety of explanations have been offered for this major turning point, as scholars tried to analyze the consequences of the collapse of the old colonial system.However, beyond the controversy, the crucial significance of this period for the now diverging history of the two countries must be universally admitted. For Brazil, of course, this was the time of the birth of the nation, when crucial choices were made and many possible lines of historical development were discarded. Similarly, for Portugal this turn of events was very important. It meant that for the first time in nearly four hundred years the country had to sustain itself without an empire. The remaining colonies, that is, the trading posts and fortresses in Africa and in Asia, had virtually no economic or financial relevance. For almost a century the empire, or what remained, played a minor role in the Portuguese economy and, wishful expectations to the contrary notwithstanding, could not compensate for the loss of the vast American colony. As a result, Portuguese society had to undergo fundamental socioeconomic adjustments to accommodate this historical development.The climacteric nature of this historical process is unquestionably related to the contentious character of the interpretations it has elicited. Bearing this in mind, this essay presents the facts and reviews the main topics of this historiographical controversy. As an active participant in the controversial debates on this topic, I will refrain from restating my former arguments, although this certainly is an excellent opportunity to make them accessible to an English-speaking audience. My aim is to offer a fresher analysis of the available evidence, with the assistance of the most recent research, and thus extend our knowledge of this critical period in the history of Portugal, Brazil, and the Atlantic world.For the Portuguese empire, the beginning of the second half of eighteenth century spelled disaster. In 1755 a tremendous earthquake and the ensuing fire destroyed the best part of the city of Lisbon as well as the cargo of the fleet from Brazil, which was stored in the customs warehouses. The damages were huge and they had scarcely begun to be assimilated when a second blow caused another shock. Gold remittances from Brazil, which had been for some decades the most important financial resource in the empire and had become the major driving force behind its integration into the Atlantic economy, began faltering. The decline, which could already be felt in 1760, became very serious after 1766.1 This problem led to significant financial strains in the mother country and caused an inadequate supply of hard currency that was required to settle international payments, a difficult task for a country with a chronic trade deficit. Consequently, the government of the marquis of Pombal hastened the economic reforms it had already initiated in the previous decade.The government aimed first at the reorganization of both the colonial trade and the main export sector in the metropolitan economy. It specially regulated the sugar and tobacco trade (1756) and created three monopolistic companies, two of which were granted exclusive rights over shipping and trade with specific regions of Brazil while the third was entrusted with the control over the marketing of Port wine. Pombal tried to secure a tighter control over long-distance trade (although the fleet system to Brazil was abolished), which he wished to see concentrated in the hands of a smaller mercantile elite (presumably more adept at competing with the foreign merchants). The main purpose of this program was to cutback the large deficits of the balance of trade. To this effect, he later encouraged import-substitution, and devised an ambitious plan to promote manufacturing production, which was mainly implemented during the 1770s.The strategy of Pombal has been accurately described by Kenneth Maxwell as the nationalization of the Portuguese economy.2 The measures he adopted coupled with the decline in gold remittances from Brazil (and also of silver from La Plata, obtained through illicit trade) originated a different pattern for Portuguese foreign trade. Because of the legal and de facto privileges they enjoyed in Portugal, British merchants controlled the gold exports, an illicit or at best tolerated business activity.3 They even transferred the money surpluses for other foreign merchants, by discounting bills of exchange drawn on Lisbon for a commission of 2.5 percent.4 But in the new trading pattern, they lost the commanding role they had played for decades. The share that British shipping held in the movement of the two main ports of Portugal decreased after 1755 and especially since 1776. In Lisbon, it fell from 55 percent in 1769–1773 (and 60 percent in 1750–1755) to 19 percent in 1779–1783, and in Porto it dropped from 72 to 47 percent in the same period.5 Imports from England also diminished, and in 1781–1790 they were down to 60 percent of the former value. Finding themselves with much less business to do, British merchants in Lisbon and Porto strongly resented this change of climate, and they were backed by their government, which repeatedly pressed, albeit without much success, for the redress of this state of affairs.Despite the energetic measures and the commitment of a strong government, the Portuguese-Brazilian economy could not immediately return to its former condition. The promotion of manufactures met with varying success, and the more balanced structure of foreign trade was achieved at the cost of the stagnation of the general commercial movement. Nevertheless, there are positive indications that the recovery of the Portuguese merchant economy was well under way in 1777, when Pombal, the great architect of the economic reforms and institutions (some of them would not survive him), was forced to resign and then banned from the court. In the significant decrease of the trade deficit, the part played by the rise of exports (which probably more than doubled between 1750–1755 and 1776–1777) was certainly more relevant than the reduction of imports (which were down by almost 25 percent in the same period).6 And then the turn of the tide was further helped by the outbreak of the War of American Independence, which changed the setting for the Atlantic economy, as other wars had previously done.During the Seven Years War, for instance, the market for Brazilian sugar, which was still the most important commodity for the colonial economy, experienced a very favorable spell. In Bahia, for example, exports and trading profits increased by as much as 46 percent.7 However, the capacity for sugar production in Brazil had remained stationary for a long time. In 1761 the number of sugarmills in Pernambuco and Parahiba was not larger than it had been some 40 years earlier, and as much as 15 percent of these were idle at the time. In Bahia the circumstances were similar. The rise in labor costs, generated by the huge demand for slaves in the mining sector, the exhaustion of marginal soils and the strong competition coming from new areas of production in the West Indies accounted for this long stagnation.In the 1770s there was some improvement, and shipments from Bahia showed a modest increase. The crisis in the mining sector eased off production conditions in the plantations, alleviating the pressure over the demand for slave labor, but marketing conditions had now absolutely changed. In 40 years, the share of Brazilian exports in the Atlantic sugar trade had dropped from about one-third to less than 10 percent.8 Until the 1790s there was a moderate progress, as the volume of sugar exports from Portugal grew by 3.6 percent between 1776–1777 and 1783 and by an additional 14.3 percent until 1789 (the increase is larger in terms of value, 10.8 and 17.3 percent respectively). But only after that did the resurgence of the sugar trade gather momentum, taking full advantage of the changes in the international market.The long-term effect of the progressive withdrawal from that market of the sugar produced in the British West Indies (drained, as it was, by the rising British domestic consumption) coupled with the sudden effect of the rebellion of 1792 in Haiti created very propitious trading conditions for Brazilian sugar. Between 1789 and 1796–1800, average exports from Portugal more than doubled in volume and, profiting from an exceptional rise in international prices, grew 3.5 times in value. This opportunity prompted a real extension of the production capacity in the colony. In Bahia, for instance, the number of sugarmills rose from 122 in 1759, to 260 in 1798.9 At the same time, an important change in the geography of sugar production took place. Besides Bahia and Pernambuco, the captaincy of Rio de Janeiro now became a significant source of exports.10Sugar was not the only commodity in this drive for prosperity. The development of cotton exports was even more impressive since the company entrusted with the monopoly of trade in the regions of Pará and Maranhão promoted its cultivation in the 1760s. In 1776–1777, exports of Brazilian cotton from Portugal amounted to no more than 388 metric tons. Over the next decade, the growth was absolutely spectacular, as exports increased sevenfold, reaching 2,886 tons in 1789, and the expansion kept apace in the following years. In 1796–1800, exports attained a yearly average of 4,443 tons. In terms of value, the increase was equally impressive, from 173 million réis to 1.4 billion (almost reaching the same value of sugar exports) and then to 3.3 billion.11 The rising demand generated by the early industrializing countries fueled this growth. In the last decade of the eighteenth century, as much as 30 percent of British cotton imports came from Brazil.12Sugar and cotton formed the two most important Brazilian products reaching the European markets through Portuguese ports. These commodities made up 85 percent of the reexports of merchandise from Brazil in 1796–1800. The only other staples having a sizeable part in those shipments were hides (6.5 percent), tobacco (3.5 percent) and cocoa (3 percent). The expansion of the demand for tropical groceries and raw materials and the slackening competition among areas of production, manifest in the rise of international prices, animated the agricultural renaissance in Brazil, as Dauril Alden has termed the economic recovery in the agrarian sector.13Part of this development must be attributed to the growth of the Brazilian domestic market itself. New research has suitably stressed the expansion and dynamic of that market.14 The expanding production of rice (which also found its way to the export market) and wheat can be explained in the first place by the need to supply a rapidly increasing population. However, large areas of Brazil still functioned as a plantation complex, which was the foundation of the colonial system. The Portuguese merchant economy lived to a large extent on this system and on the carrying trade it made possible. Reexports of products from the empire (mainly from Brazil, but also manufactured merchandise, especially textiles from India and China) formed a nuclear factor in the integration of Portugal into the Atlantic and European systems of foreign trade.Even though reexports comprised the bulk of shipments to Europe, domestic production also played a part in the newly found economic vitality. Until 1789 exports of wine, salt, wool, olive oil, and fruit grew at the same rate of reexports, in such a way that commodities from domestic origin regularly accounted for 44 percent of all foreign sales (the same ratio as in 1776–77). Once the real boom started in 1790s, they could not keep up with the growth of the market for colonial merchandise, and its share declined to 25 percent.15 However, there was another way in which the domestic production contributed to commercial development, namely, through overseas shipments of manufactured goods.Actually, there were two sides to the Portuguese carrying trade. Besides the reexports of colonial (mostly Brazilian) products, merchants in Lisbon and also, but to a lesser extent, in Oporto forwarded commodities, such as foodstuffs (grain, codfish, butter, cheese) and manufactured goods (chiefly textiles) obtained from European countries to Brazil. In 1776–1777, despite Pombal’s industrial policy, less than one-fourth of the shipments to the colonies consisted of articles of national manufacture. Portuguese yard goods formed only 30 percent of all textiles dispatched to the empire. National linens and silks already had an important share in the exports, but woolen and cotton fabrics came primarily from Britain and India.16In the next 20 years, the exporting branches of the industrial sector made impressive progress. Government protection, initiated by Pombal, persisted, although the state withdrew from its former role as an entrepreneur and decreased direct financial backing to industrial ventures. Exports to the empire were specially encouraged and the well-known law of 1785, which was designed to perfect the organization of the colonial system, expressly reserved manufacturing (sugar refining included) to the metropolis. As a result, several workshops in some Brazilian towns were shut down by the authorities. However, there was much more to the industrial development of the late-eighteenth-century Portugal than the reinforcement of the prevailing division of labor between the mother country and the colonies. Moreover growth was not confined to exporting branches and the colonies functioned as marginal markets to important sectors, such as tanning, ceramics and glass making.Part of the industrial growth was unquestionably export-driven. Most important among manufactured commodities shipped to the colonies were linens and printed calicoes (which together provided a little less than 60 percent of the total in 1796–1806). In the rise of cotton printing, long distance transactions played a decisive role, as they supplied both the basic material (unbleached cotton cloth from India) and the main market (because 60 to 70 percent of the production was remitted to the colonies). This was an entirely new industry, which concentrated in some 50 large workshops and manufactories established around Lisbon. On the other hand, linen and lace manufacturing was a traditional, purely domestic, proto-industrial production; it was scattered throughout the northwestern districts and used both local and imported flax. In a rough estimate, linen exports to Brazil at the turn of the century were the equivalent to the yearly output of some 20 to 30 thousand handlooms, accounting for about 15 to 30 percent of the total production.17Other trades also contributed to the industrial expansion. Silk and woolen manufactures, which combined domestic and centralized modes of production, supplied 17 percent of the industrial exports. For these sectors, however, the colonial market was not so important, even though between 1776–1777 and 1796–1806 overseas shipments of woolens grew tenfold. Additionally, large quantities of hats of both the finer and coarser kinds (the latter to be worn by slaves and workers), as well as metal wares, such as nails and farming tools, were exported to Brazil. These two sorts of products made up 8 and 4 percent of the transoceanic trading of national manufactured commodities, respectively.The growth of the export of national industrial goods is one of the most distinctive features of the development of the Portuguese merchant economy in the late eighteenth and early nineteenth centuries. It became one of the more dynamic branches of the foreign trade, expanding at a faster rate than gross exports and thus increasing to 35 percent its share in the shipments to Brazil. Cotton and woolen industries significantly enlarged their quotas in the colonial market. Nevertheless, this growth could not dislodge large reexports of foreign industrial stock to the colonies. In the trade with Brazil, merchandise of national manufacture became more important than goods from European origin, but when cotton and silk fabrics imported from Asia and forwarded to Brazil are brought into the picture, the part of national products comes down to 42.7 percent. However limited, this was a significant industrial spurt.The prosperity of the Portuguese-Brazilian trade in the late eighteenth century is indisputable. The controversy focuses on the timing and the nature of this prosperity. In the early nineteenth century, imports from Brazil kept up at a very high level, reaching a maximum of 13.2 billion reis in 1806. At the same time, reexports of Brazilian goods grew from less than 10 billion reis in 1796 to more than 15 billions in 1801, and then displayed a strong stability, recording values of 13 to 14 billions (with a brief setback in 1803 when they are down to 11.8 billions). On the other hand, exports to Brazil rose to an exceptional peak of 15.7 billion in 1799 and remained firm between 9 and 10.6 billions up to 1804, before falling to 8.2 billions in 1806. Despite important fluctuations, the system of trade remained unchanged. The Portuguese balance of trade tended to show small surpluses or small deficits in the transactions with Brazil, which were usually more than compensated by the excess of exports over imports in the commercial relations with the foreign nations. Before 1807 there are no real signs of a coming crisis, although in this short period some sharp variations do occur, and most of the figures in 1805–1806 reveal some uncertainty (see table 1).The scope of those variations discloses the unstable circumstances of the market, which explain—to a large extent—the prosperity itself. The succession of wars which followed the French Revolution offered very favorable conditions for the development of the Portuguese colonial trade. After taking part in the Roussillon campaign in 1791, Portugal strove to preserve neutrality in the face of very strong pressure exerted by both parties in contention. This, although expensive for the state finances (the government was forced to pay a costly indemnity to France to have the neutral status recognized), allowed Portugal to take full advantage of the crisis that disturbed other colonial empires. But the troubles of war, as much as they supported the growth of the Portuguese-Brazilian merchant economy, produced sudden changes in the course of trade, which sometimes had damaging effects. Under these circumstances, this growth proved to be uncertain.The Portuguese system of trade operated on a very delicate balance. Thus the nature of the prosperity it experienced should be questioned. Was it merely the result of circumstantial or transient factors—the wars in the Euro-Atlantic world and the troubles they occasioned for other empires—or did it take root in more permanent conditions? Portuguese historians have not discussed this issue at length and although they expressed differing views this did not arouse a true debate on the matter. In Brazil, on the other hand, this question was the subject of a more manifest controversy, giving room to a wide range of interpretations. Some authors deny the expansion, or tend to restrict it to a particular region, namely Maranhão, where cotton was grown.18 There are also those who are ready to acknowledge no more than a “seeming prosperity,” generated by incidental factors.19 And those at last who argue for a substantial development, benefiting from of the structural change in the Atlantic economy, which was the joint effect of the demographic increase in Europe, the Industrial Revolution, the growth of long-distance trade (and the corresponding decline in shipping costs) and the coming of cotton as an industrial raw material.20 José Jobson de Andrade Arruda has suggested the advent of an “actual euphoria,” as against a “false euphoria,” and he even postulates that, had the favorable conjuncture not materialized, the structural factors would still have produced an economic growth both in Portugal and Brazil.21This last assertion, as every assertion of the same kind, cannot of course be substantiated. To be sure, the factors arising from the propitious circumstances of the late colonial period can be analytically distinguished from structural factors, but historically both types of factors can hardly be disentangled, and the structural conditions only operated inside a particular historical conjuncture. The growth of the Euro-Atlantic system may well be the outcome of the structural dynamic, but the share of the Portuguese-Brazilian complex in that growth was determined by the conjuncture; and it is impossible to even “guesstimate” what it would have been in the absence of the favorable events occurring in the political-military arena.Nevertheless the prosperity, which is indisputable in the overseas trade, as much as it was dependent on those events, called for fundamental economic changes. The geography and composition of production shifted in both Brazil and Portugal. In Brazil, as previously noted, the cultivation of cane sugar spread in new areas, while cotton became a major staple for long-distance trade; and the agricultural renaissance touched other productions, both for the domestic and the export markets. In Portugal, the specialization of the merchant economy on the colonial trades became even stronger. The manufacturing activity expanded, with the advent of new industries (such as cotton printing) and the emergence of more concentrated modes of production. Easier access to imported raw materials and to the colonial market, which drained a much larger share of the manufacturing output, became the basis for a new pattern of industrial location, which invested the regions near the seacoast with a more prominent role. To be sure, this industrial development did not by any means bring the Portuguese economy to the verge of modern industrialization, in the road to which it should overcome many serious obstacles. However, there were significant structural changes and the commercial growth must not be underestimated. At the turn of the century, foreign trade per capita was larger in Portugal than in Spain, Italy, or Germany, and 5 to 7 percent of all European exports moved through the Portuguese ports.22The structural changes were in part to be reversed by the breakdown of the colonial system, which came in the form of a sudden collapse. The political-military setting, which had hitherto favored the carrying trade in the Portuguese empire, now moved against it, entailing the suspension of the colonial regime in 1808. The vulnerable position of the empire had already showed in the so-called War of the Oranges in 1801, when Spanish troops invaded Portugal, without any resistance. Had it not been for the general armistice, which was shortly signed in Amiens, and the terms of peace dictated by Spain would have been rather costly. Subsequently, the problems became even more acute. Once Napoleon put the continental system to use as his supreme weapon against Britain, the Portuguese-Brazilian empire was doomed. Portugal could not choose between British and French demands and could not resist them. Compliance to the continental system would bring about a maritime blockade and the occupation of at least some colonies by the British. Not to submit would mean war with France and ultimately the foreign rule. As Talleyrand himself said, the Portuguese were caught between two terrors. When the government finally yielded to Napoleon’s terms, it was too late. The French troops invaded the country in 1807.As the French armies entered the country, the royal family left hurriedly for Brazil, trusting British support to eventually regain possession of the kingdom. The consequences of this choice weighted heavily on the future relations between Portugal and Brazil. The decree proclaiming Brazilian ports open to the ships of all friendly nations was one of the first measures to be taken by the government on arriving in Brazil. This was envisioned as a temporary solution, forced upon the government by the circumstances, but, in fact, it put an end to the old colonial system.During the next few years, struck first by the British blockade and then by the calamities of war, the Portuguese merchant economy collapsed. Destruction and turmoil hampered both industrial and agricultural production. Internal trade was almost paralyzed and large quantities of foodstuffs were imported from 1811 to 1815. Colonial trade virtually stopped in 1808 and did not revive until 1814. In 1808–1813, exports of national commodities to Brazil had declined to 22.4 percent of the value reached in 1796–1806, and the Portuguese carrying trade between Europe and Brazil suffered an even greater depression. Reexports of Brazilian goods to Europe sunk to 11.6 percent of the prewar yearly average and overseas shipments of European goods fell down to 10 percent of the former value.From 1808 upto 1813, Portugal was almost entirely isolated. Trade with the Netherlands, Hamburg, Denmark, and France stopped altogether, and communication with Sweden, Russia, and Prussia was also sometimes interrupted. Throughout the war, Portugal depended heavily on British supplies, and Britain very nearly monopolized the foreign trade of Portugal and Brazil. Furthermore, the 1810 treaties had granted the British a commanding voice in Portuguese affairs. Trade was now regulated by an agreement that removed all restrictions on British commodities (especially cotton textiles) and levied a single 15 percent ad valorem duty on imports.Under the new market conditions and trading regime, Portugal could no longer serve as the mandatory emporium for the transactions between Brazil and the foreign nations. Nevertheless, between 1814 and 1818 a significant recovery set in. Once again, exports of Portuguese commodities fared better than the carrying trade. In 1818 the shipments of national industrial goods were just 10 percent off those of 1805 and were far larger than those of 1806. This was however an exceptionally good year for the manufacturing sector (on average, in 1815–1818, exports did not go beyond 56.5 percent of the values reached in 1796–1806). In fact, the more favorable results in the trade of national commodities must primarily be explained by the growth of wine (and especially Port wine) exports to Brazil, which almost doubled in volume and increased three-fold in terms of value. In the process of the adaptation to the new situation, a different pattern in the transactions with Brazil had emerged. The share of foodstuffs, which had formed a little over one-fourth of the exports of national merchandise to Brazil in 1796–1806, went up to 55 percent. Therefore, the commercial relations with the former colony tended to conform to the general pattern of the Portuguese foreign trade. This was the beginning of a very important change. However, at least in this period—after the end of the old colonial system and before the independence of Brazil— products of national manufacture still played a significant, though diminished, part in the overseas shipments.Under the prevailing conditions, Portuguese shipping still enjoyed some advantages in long-distance navigation. War inflicted severe losses to some European fleets, which tended to be equipped with low tonnage ships, best suited for European trade.23 Furthermore, non-British products still had to pay 30 percent tariffs in the Brazilian market. Accordingly, for some time, only Britain successfully disputed the Portuguese monopoly in the trade with Brazil. Such circumstances, however, could not allow for more than a temporary recovery. Since 1819, imports and exports to and from Brazil enter a new descent. This was the inescapable result of the postwar pattern of trade. Imports from Brazil kept up at 87 percent of the earlier values, while reexports of colonial merchandise did not go beyond 68 percent. At the beginning of the nineteenth century, trade between Portugal and Brazil was reasonably balanced. But after 1809, Portugal accumulated deficits that could no longer be offset by Brazilian goods shipped to European markets. The balance of trade turned adverse on both fronts: the small deficits (when they occurred) in the exchange with Brazil had grown almost five-fold, and the large surpluses in the transactions with the foreign nations had turned into significant deficits. The compression of Portuguese foreign trade was inevitable (see figure 1).Portuguese merchants themselves were well aware of the importance of trading privileges in their relations with Brazil. Without the assistance of the colonial system, they found it increasingly difficult to fight foreign competition. Thus, they pressed the government, both before and after the liberal Revolution of 1820 (in which they performed a relevant role), to have a new commercial arrangement approved, under which they could reinstate their preeminence. This disposition, combined with the forced return of the king to Portugal and the unwillingness of some of the Portuguese revolutionaries to compromise, could not help but speed up the insurgence of Brazil and the declaration of independence in 1822.The immediate economic effects of the independence were not very significant; it merely made the decline that had begun in 1819 even more severe. In the next few years, after Portugal acknowledged the sovereignty of Brazil in 1825, t