Structural Change in the Caribbean
1845-1868
During the second half of the 19th century, a large number of structural changes, both economic and social, transformed the Caribbean sugar economy from its old traditional state, based on slavery and individual sugar estates into a modern industrialized system, resting on central factories. For many countries, the 19th century was seen as a period of decline. The economy from 1838 till 1920 was characterized by the rise and falls in groups, industries, the introduction of new markets, and the diversification of crops.
The decade of 1845 -1855 was a critical time span for the sugar industries of the British West Indies. In the preceding eleven years, one had witnessed the Emancipation of slave laborers in the British West Indies in 1834, and the failure in these colonies of the Apprenticeship System supposedly designed to ease the transition from slave to free labour. Throughout the history of the British West Indies, no other era was so fraught with change as that of the post-emancipation decades. Within a period of a few years, the entire economic and social system of these colonies was turned upside down as the plantation economy declined overall. From 1830 with the abolition of the slave trade to 1860, the international economic situation became more and more unfavorable for planters in the British West Indies. The rapid development of new plantation territories in Cuba, Brazil, Mauritus and the East India led to the overproduction on the world sugar market. On the other hand, Caribbean production was severely rivaled by the increasing competition of the new, less expensive beet sugar which was produced at a much lower cost with new modern industrial techniques. Sugar prices declined dramatically, falling off approximately 50% between 1820 and 1850. On most of the British estates, costs went up, profits shrank and debts rose with abandonment of estates and collapse in financial institutions following.
The Decline in British West Indian Colonies were as a result of it’s:
1) Lack of Technological Innovation: Whilst colonies like Cuba and Brazil and even newer British West Indian colonies were improving with new techniques and machinery, many British West Indian plantations faced higher production cost and fewer yields with old agricultural methods. If these colonies were to compete in an open, world market, as was the idea of free trade, they had to completely renovate sugar production.
2) Sugar Duties Act of 1846: New technology was lacking in these colonies before 1846 but the Sugar Act made it even more crucial to the British plutocracy to improve their methods. The cost of producing sugar was already high but sugar colonies in the British West Indies were protected as they paid lower taxes in the British market than the Spanish and the French sugar producers, with the additional guarantee that their sugar would be bought in Britain. However this advantage was gradually removed after the systems of slavery and apprenticeship were abolished after 1838. The Sugar Duties Act of 1846 was the worst news for the British West Indies sugar industry as it meant not only that all sugar prices had to be equalized but also sold at a lower price. Before this, the West Indies had been a protected market from competition as these duties made competitors’ sugar more expensive. This act was an important sign of decline to come but it mainly jeopardized the sugar industry, not destroy it. The West Indian planters continued to oppose the Act, evoking massive protests as they saw that free trade would be their economic ruin. By 1854 colonial sugar was deprived of protection in the British market. The Sugar Duties Act of 1846 had the effect of hastening the decline in an industry that had already been suffering from a combination of other causes. The main decline in the British West Indies was seen in the older colonies like Jamaica, Antigua, St. Vincent and Grenada. This development satisfied European customers who were calling for free trade, for the freedom to purchase sugar from the cheapest seller.
3) New Competition: The issue of competition by the new sugar producers in the Caribbean emerged mainly from Brazil, Cuba, Louisiana and European colonies of Asia. Cuba, however, was seen as the main competitor against the British West Indies as they were able to produce sugar cheaper and thus undersell the B.W.I sugar on the world market and also in Britain in the late 19th Century. Cuba had an advantage over the British West Indies for reasons such as the availability of more virgin soil and more available land. The Cuban sugar industry also adopted the most technologically advanced methods of refining and producing sugar with technology such as vacuum pans, centrifuges and steam engines. They also had the advantage of more adequate and reliable slave labour until 1880 when Cuban slavery ended. In contrast to Cuba, the British West Indies lacked virgin soil, islands were geographically small, they suffered from a lack of capital, and estates were in debt and did not have a reliable source of labour.
4) Beet Sugar: Other than these new sugar producers, a new type of sugar was developed in 1747, by a Berlin scientist, Andreas Marggraf as he demonstrated how sugar could be taken from the red and white beet. Experiments continued to develop this until beet sugar became a commercial crop in the 1880’s becoming the main competition for British sugar. This sugar became most commercialized as a result of the Sugar Duties Act in the British Caribbean. The removal of the high taxes charged on foreign sugar sold to Britain, encouraged European countries to finance the export of beet sugar. The depressed state of European agriculture and the need for farmers to grow a profitable crop for export were also push factors for the production of beet sugar. European beet sugar industries provided employment opportunities and made their colonies independent off of imported sugar. It also helped the economy in Europe as it employed a large working population and unlike sugar cane could be stored for months without spoiling. Beet sugar had a lower cost of production, was also sold at cheaper rates and carried a lower freight (transportation weight) than that of sugar cane. Lower prices made beet sugar more popular among British consumers with the addition of the reputation of being a superior quality to the West Indian sugar cane. As a result, both the consumption and level of imports of cane sugar into Britain decreased.
Link: Explaining further the problems faced by the sugar industry and measures used to improve this in the post emancipation period.
The economic developments of the british caribbean 