How Britain gained an empire - economics and commerceThe expansion of global commercial activity

Looking West

The rise to power of King Henry VII and the success of his son, King Henry VIII, and granddaughter, Queen Elizabeth I, in establishing England as a fully independent kingdom had a significant effect on the expansion of global English commercial activity.

There were a number of key factors in England’s expansion and success during the 16th and 17th centuries:

North America and The Virginia Company

• In Britain in the 1500s, unemployment was rising and wages were low. American colonies offered economic opportunities for settlers from Europe. Many British people emigrated and made money by growing crops such as sugar and tobacco.
• Established in 1606, the Virginia Company was given a Royal Charter to explore, settle and establish plantations in the New World, specifically North America. English explorers like Walter Raleigh had already given potential investors in London the belief that colonies in North America would bring them large profits - and the Virginia Company established an English claim to large areas of North America. The profits from the North American colonies would be used to invest in further colonisation in the New World.

Piracy and plunder

• In the late 1400s, Spanish explorers started to colonise the Americas. The wealth and land Spain gained from this made them a powerful nation. One way Britain tried to reduce Spain’s power was through privateers. These were sailors with permission from the monarch to raid and steal from Spanish ships, splitting the proceeds between them. Sailors who did this without the permission of the government, or who kept all of the proceeds for themselves, were known as pirates.

The Transatlantic Slave Trade

• In the 16th and 17th centuries, England was a minor player in comparison to Spain and Portugal. The Spanish made vast profits from gold and silver mines in South America while the Portuguese focused on cultivating sugar in Brazil and the Caribbean. To do this, they needed cheap labour (that they would sometimes work to death) to get valuable sugar to Europe to be sold at a huge profit.
• In 1562 the English sailor John Hawkins stole a Portuguese slave ship off the west coast of Africa and sold the enslaved Africans in the Caribbean. Eventually England built up a navy and colonies in the Caribbean that allowed them to surpass the Spanish and Portuguese in the sale of kidnapped African people.
• The slave trade also benefitted the British economy in other ways. Shipbuilders, banks and importing companies all prospered. Cities like Bristol and Liverpool expanded due to their role in the slave trade. New companies were set up, such as the Royal African Company who transported enslaved people from West Africa to the Caribbean.

The West Indies and sugar plantations

• The English slave trade centred on the island of Barbados. It was colonised by the English in the mid-17th century and was perfect for growing sugar. This was a very labour-intensive process and more and more African enslaved people were shipped across the Atlantic to work on these plantations. By the end of the 17th century English plantation owners were making vast profits from the sugar and tobacco trade and their money was usually reinvested in further expansion.

Competition in the East

Competition for trade in the East Indies was much fiercer. There were a number of reasons for this:

• There were already three major empires in East Asia that had some control over the trade of cloths and spices; the Ottoman Empire, the Mughal Empire and the Chinese Empire. To make things more complicated for the English East India Company, the Dutch East Indies Company was already successfully established in Indonesia and in control of the valuable spice trade.
• The East India Company focused its attentions on trade with the Mughal Empire and established trading posts on the coast of eastern India. These small trading posts would become the platform for the British Empire in India.