The Philippine Islands, 1493-1898 — Volume 22 of 55 / 1625-29 / Explorations by early navigators, descriptions of the islands and their peoples, their history and records of the Catholic missions, as related in contemporaneous books and manuscripts, showing the political, economic, commercial and religious conditions of those islands from their earliest relations with European nations to the close of the nineteenth century.

by Unknown

Economic Reasons for Suppressing the Silk Trade of China in Spain and its Colonies

Reasons of expediency existing why the importation of the silk of China and the other merchandise of that country ought not to be permitted in the Indias and these kingdoms, but rather prohibited; and the damages and troubles that follow from its not being prohibited in every point, and its trade, are the following.

It is very pernicious to permit the importation of the silk of China and its trade, both in the Indias and in España. For although not more than two hundred and fifty thousand pesos de Tipuzque can be taken from Nueva España to the Filipinas annually, besides that sum another incalculable quantity of money is taken in reals of eight; for the said silk can be bought or traded for nothing else, nor will the Chinese give or exchange it for other merchandise. Consequently, they manage to get hold of and carry away annually the greater part of the eight-real pieces which are made in the said Nueva España, in exchange for grass, which is the substance of that coarse and harsh silk which is so plentiful among the Chinese.[1] Thus do they weaken our strength and increase their own; and consequently they can make war on us whenever they wish, without any cost to them as far as we are concerned. And since this money does not come to España, it cannot be invested there in merchandise, and the customs duties and the excise duty cannot be collected from them; and they cannot return with a greater sum of money with which to make larger investments, resulting in the great increase of the said royal incomes, and the common benefit of his Majesty’s vassals. Besides, if that silk were not taken from China to Nueva España, it would not be used there; nor would it be poured into Piru and Tierra Firme, as is done. For, notwithstanding the prohibition established forbidding any merchandise to be taken there from China, a very large quantity of it is taken to the said provinces from Nueva España, and it is used there—the viceroys, generals, and justices concealing and favoring it for their own private interest and benefit. For that reason much less Spanish merchandise is used in the said Piru and Tierra Firme than was formerly consumed, and than would be used if the merchandise of China were not sent there. That condition causes the merchandise of España to have one-half less value than before. Hence it results that daily fewer trading ships arc sent from these kingdoms than formerly, and than would be sent if the said trade with China were to cease. That is the reason why the Spanish silks and other merchandise are so seldom demanded or consumed in the Indias. That, with the low prices at which they are sold, and the numerous duties which are paid, and the trade so ruined, makes the exporters and merchants derive so little gain from their investments that they do not care to increase or to continue their trade, and cease to attend to it. On that account, the said Indias do not depend, as it is right that they should depend, on these kingdoms; while, as there and in these kingdoms is consumed the merchandise of China, which is only bought with standard reals of eight, an enormous amount of coin is taken there in exchange for the merchandise, and thus is not sent to these kingdoms to be invested here, in order to return them to the said Indias. [If that were done], the duties thereon (together with the great cargoes and the increase of business in all directions) would increase very greatly, as would be clearly and quickly seen in the increase of the royal revenues. The prohibition of the said merchandise of China is of much greater advantage to the royal revenues than the permission; besides, it is the universal remedy [for the troubles] of these kingdoms and of the said Indias, that the said merchandise be not exported to either the former or the latter. [There is a parallel to this in our domestic trade], for in place of the wheat (because of the lack of it that is generally experienced in the maritime towns of this kingdom), foreigners are continually carrying away from us so great an amount of money through the permissions given to them for export, and with what they demand besides, for the wheat, and in exchange for the copper coins that they force on us, and other articles that they bring to us, which they have in plenty—but which we do not need, as we have all of them in our España. Thus they weaken our resources and strengthen their own; but this would be avoided if we did not need the wheat, and they were not permitted to bring the other things. Just so, not having need (as there is none) of the wares from China, because we have so many of them in these kingdoms (which moreover are known to be so much better in quality), we should cease this trade, which only carries to China that great treasure which is annually withdrawn and conveyed thither, without any hope that any part of it will ever return to us. For the Chinese have a great surplus of all goods, and never come to buy anything, but only to sell—and that only for reals of eight; and consequently, they make their prices so cheap, in order to get the reals, that they constrain one to buy a much greater quantity of their merchandise than he would buy if the prices were higher and the profits less. And although the profits are seemingly large at first, they are not so in reality, because of the little durability of the Chinese goods, and because of the damage caused to the merchandise of España by their importation; for, by permitting it, the consumption of Spanish goods is lessened, and they have less value. Consequently—setting aside the so universal damage to all the natives [of España], and in particular that to the producers of the said silk (and its production is daily diminishing, to such an extent, indeed, that in a very few years so little will be produced that the damage will be made plainly evident in the royal duties, and in its lack and scarcity), and how much greater benefit would be the prohibition than the permission of the said silk of China—his Majesty and his ministers, in attending to his royal revenues, are under obligation to furnish suitable relief for this, for the welfare of his kingdoms and vassals. Since the towns of the kingdom of Granada were given, after their insurrection,[2] under an annuity obligation [censo] to private persons so that they might settle therein, and the annuity amounts to more than one hundred thousand ducados of revenue, which are paid through the increase in the production of the silk; and [it is necessary] that there should be a ready sale and handling of it, for the estates that were given to them have no other important products from which they could obtain the money to pay the said annuity; necessarily, if the production of the silk ceases, then the payment of the annuity will cease. For in that and in the ready sale of the said silk consists the power [to pay the annuity]; and it also consists in the many people who, having the silk, would occupy themselves in its production, culture, and preparation, who will consume and use a great quantity of food. That would cause an excise duty on the food of more than one hundred thousand additional ducados per year; but this income would cease if the production and cultivation of the silk ceased, and his Majesty would lose the said one hundred thousand ducados. Besides, the said silk paying, as it does, three hundred and two maravedis per libra—without reckoning the tenth, or the forty per cent on the gross price at which it is at once sold in the alcaicerias—as soon as it is sold, while there would be less produced and sold, and the price of it would be lower, the duties will be less. And since the silk of China does not pay more than fifteen per cent of import tax and excise, because it is foreign, his Majesty loses twenty-five per cent on each libra of the silk of the kingdom of Granada. That silk is produced in less quantity by the importation of that of China; and since our silk pays higher duties than the foreign—either because of its excellent quality, or because it is native, or for some other reason—that freedom from duties ought to be extended to it rather than to the Chinese silk, instead of burdening it with greater duties. These latter should be imposed upon the Chinese silk, so that, less of it being imported for that reason, less money would be taken from Nueva España to Filipinas for its purchase; while more money would be brought to these kingdoms. That would result in greater investments and cargoes, and more silk would be produced in these kingdoms. For so little silk has been produced in the kingdom of Granada for the last two years, because of its little sale and value and its great cost, that the duties from the revenues of their silk have been worth thirty thousand ducados less each of those two years than they were worth during the years before. Two signal losses have resulted from that, and they will become greater every day, and more irreparable. The first is that as so little silk is produced, and the producers have left the leaves on the mulberry-trees, the trees have come to such a pass that for lack of pruning and care they will be ruined in little time and destroyed—so that when one may try to remedy them he will be unable. The other is that the little silk that has been produced has been of so little profit to the producers because of its diminished value during this time—on account of the quantity of foreign silk that has been imported and its better sale, because of the lower price at which it has been sold—that the said producers and the holders of the annuity grants have not had sufficient means to pay the said annuities; and for the last two years they have owed his Majesty two hundred thousand ducados. It will be impossible to pay that sum and what shall be owing in the future years, as long as the importation and sale of that foreign silk is not prohibited. But if that be done, the production will be increased, and the trade and value [of the Spanish silk] will return to its former figure. By that benefit all the producers will be encouraged to persevere in it, and will cause greater duties, not only for the larger amount of silk that there will be, but in the excise duty for the consumption of food. The producers will have the means to pay what they owe on the annuities that are due and will fall due. And although the silks will be dearer than now, the greater durability of what will be made from them, because of their good quality and worth, will make them cheaper. For if the Chinese silk is not imported, nor ours mixed with it (which is the thing that spoils, harms, and damages ours), what is woven will never break, and will not be dear at any price. The money [now] invested in the silk of China and taken to that country will come to these kingdoms, and will be invested in our silks and merchandise and the returns from them will continue to increase both in the increase of the royal revenues, and in the universal welfare of his Majesty’s vassals. Thus will it be seen in a very short time how well advised has been the decision that will be made in the prohibition of the said silks of China, as well as the great damage that its importation has caused. Besides, the danger of navigation will not be so great, because of both its less distance and its greater safety; nor will there be so many losses of ships and property as there arc continually now. This trade will proceed with less coercion by the enemies; consequently, the power of the latter will not be so great, nor will the depredations that they commit on our own coasts by robbing us have to be feared. That is all worth very considerable thought, in order that one may see how just is this claim, and so that the remedy for this difficulty be procured, as it is the one that demands reform most urgently of all that now present themselves to our attention.

Juan Velazquez Madr^co

[Endorsed in writing:[3] “Arguments why the silk of China should not be admitted into the Yndias or into España. October 7, 628.” “File it with the papers that treat of this matter.”]

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[1] Probably referring to the plant called “China grass” (Boehmeria nivea), a shrub indigenous in India, and probably in China and other countries of eastern Asia; also introduced by cultivation into Europe and America. The Chinese name for it is tchou-ma. The well known “ramie” is but a variety (tenacissima) of Boehmeria nivea. The fiber of China grass is considered as a textile substance of the first rank. For description of this plant and its culture and use, see C.R. Dodge’s Useful Fiber Plants of the World (U.S. Department of Agriculture, Washington, 1897), pp. 85–91.

[2] This was the revolt of the Moors in Granada in the reign of Felipe II, which occurred in 1568–71, under the leadership of Aben Humeya. It was due to an edict restricting the liberties of the Moors, and depriving them of the exercise of most of their distinctive customs. It was quelled under the leadership of the famous Don Juan, and the Moon were expelled from their homes to other parts of Spain.

[3] This document, like so many existing in Spanish archives, was printed, evidently for the greater convenience of the members of the Council. The signature is in writing, as also the above two endorsements, which are in different hands.