Free Trade and the Informal Empire (AQA A-Level History): Revision Notes

Free Trade and the Informal Empire

From mercantilism to free trade

Mercantilism refers to the economic doctrine, dominant in Europe during the seventeenth and eighteenth centuries, which held that national wealth and prosperity depended on economic self-sufficiency. European states envisaged that colonies would supply valuable raw materials and provide markets for their manufactured goods.

By the 1850s, British politicians had committed themselves to free trade – international commerce conducted without the imposition of tariffs. This represented a departure from conventional imperialism, which enriched imperialists at the expense of subject peoples. Free trade, in theory, offered mutual benefits to Britain and its trading partners. Britain held that unrestricted commercial relations would permit the free movement not only of goods but also of ideas. Eventually, Britain would export its institutions and values alongside its manufactured products – all of which were viewed as superior to those of other societies. Britain perceived itself as a liberator, opening up 'closed' societies.

Nevertheless, if free trade faced rejection or resistance from indigenous peoples, Britain stood prepared to impose it by force. The British government maintained that this served Britain's own interests, while also claiming it would ultimately benefit indigenous peoples themselves.

The imperialism of free trade

Historians Ronald Robinson and John Gallagher, writing in the 1950s, argued that British imperialism was shaped as much by 'informal' imperialism as by 'formal' annexation (the permanent acquisition of territory). They emphasised the importance of free trade, characterising British imperialism essentially as an 'imperialism of free trade'. According to Robinson and Gallagher, Britain undertook formal – and expensive – colonisation only as a last resort when commercial interests could not be secured through informal means.

Robinson and Gallagher's interpretation suggests that Britain was reluctant to expand territorially given the massive territorial gains already achieved. Their work remains valuable in highlighting that the Empire was a complex entity with influence extending far beyond formal political boundaries. Britain remained determined to protect its commercial interests, preferring to achieve this without annexation where possible.

The informal Empire: definition and scope

Alongside its formal Empire, Britain possessed what is commonly termed an 'informal' Empire. Rather than directly controlling countries, Britain relied on the influence of its bankers and merchants, its consuls and the Royal Navy to ensure it exercised considerable control. The 'informal' Empire was essentially a sphere of influence, not an 'empire' in the conventional sense. British influence fluctuated according to circumstances, including the cooperation of local politicians and the policies of rival powers.

China

Britain's primary challenge regarding its informal Empire in China was persuading Chinese authorities to open doors to trade. The First Opium War (1839-42) was fought to achieve this objective. Following the Treaty of Nanking (1842), China was compelled to cede Hong Kong to Britain, open five ports to British merchants (including Shanghai and Canton), and reduce import duties on British goods.

Some observers interpreted the acquisition of Hong Kong as evidence of Britain's intention to seize control of all China eventually. China appeared to be in terminal decline, characterised by weak leadership, an inefficient bureaucracy and a stagnant culture. However, most British politicians sought to exploit China commercially rather than precipitate its collapse. Provided Chinese emperors maintained security for existing trade, Britain left them undisturbed. When they failed to do so, Britain responded with force.

The Ottoman Empire

Britain's primary objective in the eastern Mediterranean and the Middle East (the predominantly Turkish and Arabic-speaking areas around the eastern end of the Mediterranean Sea and in the Arabian Peninsula) was strategic rather than economic – preventing Russia from gaining power over the region. Consequently, Britain supported the declining Ottoman Empire (the vast empire controlled by the Ottoman Turks in the Middle East). Lord Stratford de Redcliffe, Britain's ambassador at Constantinople in the mid-nineteenth century, exercised substantial authority in the Sultan's Court.

Latin America

British financiers played an important role throughout much of Latin America, particularly Argentina and Uruguay. As a result, Britain wielded considerable influence across much of South America.

The debate over 'reluctant' imperialism

Historian Sir John Seeley, writing in the 1880s, claimed that Britain's Empire was acquired in a 'fit of absence of mind'. Other scholars, whilst not advancing the argument quite so emphatically, view the British political establishment after 1850 as 'reluctant' imperialists, unwillingly annexing territory.

Some politicians were indeed more hesitant than others. Given the vast areas brought under British control between 1857 and 1874, however, the notion of 'accidental' or 'reluctant' imperialism is not especially convincing. The Empire expanded in a haphazard manner – through conquest, through settlement, through cession (the process of relinquishing power or ceding territory) and through various other means. Sometimes expansion was not driven from London but rather pulled outwards from the extremities. Numerous instances occurred of the British dog being wagged by its colonial tail.

Imperialist attitudes in 1850s Britain

There appears to have been limited enthusiasm for Empire in Britain during the 1850s:

• Following the Industrial Revolution (the economic and social transformation resulting from the shift from home-based industries to factory-based industries powered by machinery), Britain dominated world trade. It appeared the country no longer required extensive and expensive colonies.

• In the mid-nineteenth century, Britain and its overseas possessions (except India) seemed relatively secure from external danger given the power of the Royal Navy. Consequently, there seemed little need to expand for defensive purposes such as acquiring a safer frontier line.

• The loss of Britain's American colonies (in 1783) suggested that colonies, like overripe fruit, were destined to fall from the tree. Given this expectation, there appeared little purpose in acquiring them.

Nevertheless, between 1844 and 1870, during a period when there was supposed indifference towards Empire, Britain acquired or annexed New Zealand, the Gold Coast (present-day Ghana), Hong Kong, Natal, Lagos, Sierra Leone, Lower Burma, Kowloon, Basutoland and large areas of India. From 1837 to 1872, the Empire expanded on average by 100,000 square miles annually – almost the same rate of expansion as in the second half of Victoria's reign, typically regarded as the 'golden age' of territorial expansion.

British interests and justifications

British imperial expansion was not the product of a coordinated policy of conquest. British governments were nevertheless determined to maintain Britain's economic, political and strategic interests. Consequently, there was minimal prospect of Britain abandoning its Empire – and certainly not its possessions in India. Threats to perceived interests often resulted in further expansion.

Lord Palmerston, champion of an assertive British foreign policy and prime minister 1855-8 and again 1859-65, was more interested in fostering commerce than acquiring territory. Sometimes, however, one enterprise led to the other. Regardless of circumstances, Palmerston had an unshakeable principle: 'the interest of England is paramount'.

Britain also possessed idealistic justification for imperial expansion. Christianity and civilisation followed the Union Jack. Many Britons believed it was their country's duty to improve the world. Even critics of Empire regarded British settlement and rule over large parts of the world as a 'good thing'. For critics of the Empire, as well as ardent imperialists, it appeared Britain's manifest destiny (a God-given right; the term is more commonly associated with the USA's westward expansion in the nineteenth century) to be the liberator, protector, transformer and liberal evangelist (people who work to spread what they believe to be good ideas) of the world beyond Europe. Politicians might deplore the Empire's troubles and costs, but most believed it was essential to Britain's greatness.

British strengths enabling expansion

The Empire was able to expand for several reasons. Military and economic strength were paramount, although other factors such as emigration also contributed.

Military strength

In the mid-nineteenth century, the Royal Navy ruled the waves. During the 1850s and 1860s, it was converted from a fleet of wooden sailing ships into a fleet of iron, coal-fuelled steamships. It protected Britain, its colonies and its trade routes.

The British army was also a major force. Far superior in training and equipment to any of its colonial enemies, it proved to be a highly effective instrument for the defence and enlargement of the Empire. It fought 15 major wars between 1857 and 1899 and won them all.

Emigration

British expansion partly resulted from the propensity of Britons to migrate. Nineteen million people, twice as many as from any other part of Europe, emigrated from Britain between 1815 and 1930. Britain's rapid economic development encouraged population growth. Some parts of Britain, particularly Scotland and Ireland, were notable exporters of people due to economic hardship at home.

Economic strength

Britain's economic strength was essential to its imperial power. By 1870, Britain was at the height of its commercial and industrial power:

• It accounted for half the world's trade in textiles and metal manufactured goods
• Its gross national product (GNP) (the total value of all goods and services produced within a country plus the income from all investments abroad) was higher than that of China and Russia combined
• Its merchant fleet carried half the world's sea-borne trade

As well as being the workshop of the world, Britain was the world's financial centre. Income from commercial services, such as shipping and insurance, continued to increase. Britain had capital to spare and some of that capital went into its colonies. Britain's economic and financial strength helped tie the colonies to Britain. Colonies, as well as purchasing British goods, produced goods either for consumption in Britain or for sale to raise capital for further investment in Britain.