Don Juan Grao y Monfalcon, procurator-general for the distinguished and loyal city of Manila, the metropolis and capital of the Filipinas Islands, declares that the preservation and protection of these islands are of the utmost consideration and importance, and deserve the most careful attention, on account of the great advantages and profits which they afford—to say nothing of the principal consideration, namely, the service of God, and the propagation of religion and the Catholic faith. In the aforesaid city and in the other islands that faith is established, and will steadily become stronger, increasing and spreading not only among those but other and neighboring islands. This is especially true in Great China and Japon, which from continual intercourse and friendly relations with the said Filipinas Islands may—if the Christian faith is preserved and permanently maintained in the latter, and as deeply rooted and as pure and constant as at present—look, in the said matter of religion, for felicitous and great results. The same [may be said] for what concerns the service of your Majesty, and the profitable and advantageous increase of the royal estate, since even the profits which your Majesty at present enjoys and possesses in the said city and the other islands are many, and of great importance. For in one village alone, which they call Parián, an arquebus-shot from the said city [of Manila], more than twenty thousand Chinese Indians called Sangleys, and in the other islands over ten thousand more, have all come from Great China and Japon for their own private affairs and interests. It is they who build up and maintain the greater part of the traffic and commerce of the islands. From that result the trade with Nueva España, and the ships which sail thither annually, laden with many different kinds of merchandise (carried [to Manila] and bartered by the said Sangleys)—such as much gold (wrought, and in sheets); diamonds, rubies, and other gems, besides a great quantity of pearls; many silk textiles of all colors—taffetas, damasks, satins, silk grograms, and velvets—and raw silk; a quantity of white and black cotton cloth; amber, civet, musk, and storax. Thence arises annually great gain to the royal treasury, on account of the many considerable duties which are paid and collected—both when the ships leave the said city of Manila, and their islands and ports, and in that of Acapulco; and later, when they enter Nueva España and the City of Mexico. There, when the ships leave for the said Filipinas, the duties are doubled, as well as in the said port of Acapulco, by those duties anew incurred and paid, the [trade of the] said Sangleys being a great part in this receipt [adquisicion]. Of no less consideration is the tribute which the Sangleys pay to the royal treasury for their license, and right of entrance and residence in the said village of the Parián, and in the other islands where they reside. Since the said Sangleys number thirty [thousand], they pay in most years an annual sum of two hundred and seventy thousand reals of eight (which means nine reals of eight for each license), which are placed in the royal treasury. In the islands of Pintados and other islands which belong to the said Filipinas, there are one hundred and fourteen thousand two hundred and seventeen Indians, all paying tribute to the royal treasury. Their conservation is very necessary, as they are no longer wild and are excellent workmen, and for that reason are people of utility and profit for any occasion that may arise—especially as there are also many gold mines in the said islands, whence is obtained a quantity of gold. There are also other fruits of the land in great abundance, especially wax, cotton, large cattle, swine, fowls, rice, and civet, besides other innumerable products and means of gain. All of this tells and publishes the great importance of the said city and its islands, and of their preservation; and the many incomparable wrongs which would follow if the said city, the capital of the others, were to become depopulated, ruined, or destroyed. It is very near to that, because of the great and continual misfortunes and disasters which the inhabitants of it have suffered and are suffering, caused by fires that have destroyed almost the entire city and the property of the said inhabitants, and the shipwreck and loss of many different vessels, which have been miserably wrecked during the usual voyage from the said city to Nueva España, with the destruction of the goods and wealth of the said inhabitants which are carried in the ships. The effects from so many and so large losses last and will last always; for those losses have ruined and impoverished the inhabitants to a degree very different from what one can imagine and explain. Consequently, if the generosity, magnificence, and powerful hand of your Majesty do not protect it, one can and must fear the very certain ruin and destruction of the said city and of the other islands, which are under its government and protection. From that [ruin] will follow great and intolerable disadvantages and losses to the disservice of the royal crown, the loss of that land and community, and (what is most reprehensible) that of religion and the Catholic faith. Although this is so deeply rooted in the said city and in the other islands, it would be lost, if the Dutch gained possession of Manila, as they have done of many neighboring islands and forts: namely, the island of Motiel; that of Maquien, where the Dutch have two forts, named Talagora and Mosaquia; the island of Ambueno, where the above-mentioned people are fortified with considerable artillery and a Dutch population; that of Xacadra, where the said Dutchmen have their capital and where a captain-general and an Audiencia composed of four auditors reside, and a settlement and population of one thousand Dutch inhabitants; the islands of Xaba Major and Minor, and that of Mindanao. In some of those islands they have established their factories, where they collect what they pillage, and [carry on] their trade with the Chinese and other nations. They gather in the said islands (whose products consist of cloves, pepper, and nutmeg) an exceedingly great quantity [of this produce], for which three ships are annually despatched to Olanda, laden with more than three thousand five hundred and fifty valas [i.e., bares = bahars] of cloves (each vale [sic] containing four hundred and sixty libras), with a great quantity of pepper, and of the said nutmeg and its mace; also silks, cinnamon, and other products. Hence they are extremely well fortified in the said islands, as well as in others, as they have an understanding with the surrounding kings. For the king of Daquen gives them eighty thousand ducados annually in order to have them protect his country, and so that his vassals may go and navigate safely in those straits on their trade and traffic with the islands surrounding his kingdom. All of that obliges the said city of Manila and its other islands to be more watchful and to maintain larger forces and supplies. For were there neglect in this, the power and invasion of the said Dutch, who have so frequented and learned the said straits (of which they have so thoroughly taken possession and with so many forces, as above narrated), could be feared.
Although the said city and its inhabitants have been and are always very careful and vigilant (as is very well known); defending, at the cost of their lives and goods, the land from the incessant bombardments, surprises, and attacks of the said Dutch, with the forced obligation of very generally keeping their arms in readiness all the time; enduring a servile life full of annoyance and danger, although they could leave it, and it would be better and more worth living if it were less grievous, and free from so many dangers and difficulties: nevertheless they endure them, in consideration of the service of your Majesty, and in continuation of the many services which they have rendered in the defense and preservation of that country; and hoping that the greatness and liberality of your Majesty will protect and relieve them, so that they may accomplish their purpose better. Particularly do they ask that you order to be repealed the collection of the two per cent, the imposition of which was ordered by a decree of the former year six hundred and four on the merchandise exported from the said islands to the said Nueva España, in addition to the three per cent paid on them by the merchants of the said city—which heard and received notice of the said royal decree in the year of six hundred and seven, while Don Rodrigo de Vibero was governor. At that time the decree was not made effective or fulfilled, as the difficulty and great disadvantages that accompany it were recognized. Consequently, it remained in that condition until the year six hundred and eleven, when the collection of the said duty was again charged to Governor Don Juan de Sirva [i.e., Silva]. He, trying to carry out its provisions, recognized the same difficulties, for the many reasons advanced by the city, which were so just and relevant that they obliged him to call a treasury council. Having there discussed and conferred upon those reasons, and it having been seen that they were so urgent and necessary that they strictly prevented and ought to prevent the execution of the said royal decree of 604, he suspended it for the time being, giving your Majesty notice [thereof]. The decree remained in this condition until the year six hundred and twenty-five, in which the royal officials again discussed the matter of the collection of the said two per cent, during the government of Don Fernando de Silva. He, recognizing the same obstacles, and that those obstacles were much greater then because of the worse condition and the notable change and damage to which the affairs of the said city had come—the property, traffic, and means of gain of its inhabitants—with a great reduction and difference from that which they had in the said year of six hundred and seven, concurred with what had been provided by his predecessor, the said Don Juan de Silva, and ordered that no innovation be made in it. The same was done by the governor who succeeded him, Don Juan Niño de Tabora. Thus, the said governors, as each confronted the matter, always came to see very plainly the said difficulties, which at present are not only of the above-mentioned character, but are impossible to overcome because of the condition of affairs, the poverty of the inhabitants, and the great decrease and diminution of the trade and commerce of former times. That is given more prominence by the efforts of the visitor, Licentiate Don Francisco de Rojas, who made strenuous efforts to have the collection of the two per cent carried out. Nevertheless, he saw with his own eyes the said disadvantages that resulted from the said collection. One of them was the resolution of the inhabitants not to export their goods and merchandise; nor could they do so, because of the great losses, both past and present, which they have encountered. This is the greatest damage that can happen to the royal treasury; for if the export and commerce ceases, not only will the said two per cent be lacking, but also the old three per cent which has always been paid, as well as the other three per cent which was lately imposed upon the merchandise which the Chinese Indians bring to the said city and the Filipinas Islands. Accordingly, if the commerce of the islands with Nueva España fails, it is certain and infallible that that of the said Chinese, which forms the whole export to Nueva España, will also fail.
Therefore, the said visitor, notwithstanding the great desire which he showed of putting the said collection into execution, did not dare to do it; but considered it better to suspend it, and report to your Majesty. Although he tried to have it collected as a voluntary service for the future, the citizens, seeing their great lack of wealth, could not conform to that measure, although for that time only they gave a subsidy of four thousand pesos, on condition that it should not serve as a precedent for the future, and that there should be no further talk of the said collection [of the said two per cent] until, after your Majesty had examined it, a suitable decision should be adopted. They petition your Majesty to be pleased to consider the very necessary and urgent causes and reasons why the said collection of the said two per cent should not be carried on, but that its execution be abrogated, which are as follows:
First, that the motive and cause declared in the said decree of six hundred and four for the said imposition, was the declaration that there was suffering because of the great profits of those who were trading and trafficking in the Filipinas commerce. It was said that the profits were one hundred per cent, and at times two hundred. Although the said Sangleys, antecedent to the said year of six hundred and four, brought the merchandise from China to the said city, and sold it at prices so low that when taken and sold in Nueva España it allowed a very great profit: still that ceased many years ago, from the said year of six hundred and four, when the Dutch enemy and pirates began to continue in and infest those islands with many different plunderings of the merchandise that the Chinese ships brought to the said city of Manila. On that account the said trade has gone on diminishing from day to day, very fast and steadily, to the pass to which the said Dutch have brought it by their pursuit and pillaging of the said Chinese ships. From that has resulted the ruin of the said commerce, and for the same reason the profits of it [have declined] to so great a degree that scarcely can one now buy one pico of silk for the price that he formerly paid for two and one-half picos. This has been the reason why, since the merchandise of the Chinese was lacking to the inhabitants for their investments, they have had to buy the goods from the Portuguese of Macan, at prices so high and excessive that they make no considerable profit in Nueva España. Consequently, the profits that the inhabitants of Manila formerly had have come to be made by the said Portuguese of Macan. Thus the reason and motive for the said royal decree has entirely and surely disappeared; and this same fact ought to do away with its ruling.
The second reason also is founded on the expense and cost that had to be incurred for the security and defense of the trading ships from the said islands to Nueva España, with the fifty soldiers, military captain, and other officers; that the said ships had to be of a certain tonnage; and that for this reason of the said expenses and costs, the said decree ordered the imposition of the said two per cent in order that it should be unnecessary to have recourse to the royal treasury. It ordered the proceeds therefrom to be deposited in a separate fund and account, for the said expenses which had to be incurred with the said ships and their crews. That reason likewise has had no effect, for the said expenses have not been made, nor are they made; nor do the said military captain, soldiers, or other officers sail in the said ships. Neither are the said ships—those that there are—of the said burden and tonnage, but smaller. Therefore the said expenses and costs cease, upon which the said decree is grounded; accordingly, that which is ruled and ordered by it ceases, for the reason stated, and, indeed, should cease.
Third, because by the former year of six hundred and eleven, the said governor, Don Juan de Silva, seeing the unsatisfactory method and arrangements existing for the collection of the said two per cent, tried to supply it—and did so—by the method that he thought least harmful, and of greater profit to the royal treasury—namely, to impose in its stead another duty of three per cent on the merchandise brought by the Chinese to sell in the said city of Manila. But, although the said imposition is ostensibly on the said Chinese, it comes, in fact, to be imposed on the inhabitants of Manila themselves; for the latter, being the purchasers, necessarily have to pay more, the Chinese sellers taking into consideration the new charge and imposition which has been levied on them. Consequently, the said two per cent has come to have actual effect and with greater profit by the said three per cent substituted in its place, which fact the said governor, Don Juan de Silva, had in mind. If the decree were again to be carried out, it would mean a double imposition for the above-mentioned damages and obstacles, and there would be no possibility of executing it.
Fourth, because the royal duties which the inhabitants pay on the said investments that they make, are very great; for on every thousand pesos of principal that they invest the duties in the said city and in Nueva España amount to two hundred and seventy pesos and more, while the cost and expense incidental to the said investments amount to two hundred and eighty pesos more. Consequently, the said royal duties alone for each one thousand pesos invested inevitably amount, as is well known, to five hundred and fifty pesos. Therefore, within four years, setting aside the said costs and expenses, the said inhabitants come to pay more than the said one thousand pesos of capital for the said royal duties. The same thing happens in the same proportion when larger sums are invested.
The fifth springs directly from the preceding reason; for since the said duties and said costs and expenses are so great, and the profits so slight and uncertain, as above stated, the said inhabitants cannot continue the said trade and commerce of Filipinas with Nueva España; for to do that would be a poor management and administration of their possessions, carrying them over seas at so many risks, and in danger of catastrophes such as generally happen, which are daily becoming greater; while there is no profit, or so little that, with the said two per cent, the profits will be of little or no consideration, for which they will not expose their goods and capital to so great a risk.
Sixth, because, if the said collection and enforcement of the said two per cent were to be insisted upon, it would be a foregone conclusion that the inhabitants would abandon the said trade and commerce, and would not make the said investments, for the reasons stated above. That has proved to be so on the occasions on which the said collection has been discussed with some warmth—and especially when the said visitor, Licentiate Don Francisco de Rojas, tried to effect it, when the said inhabitants were firm and were resolved not to appraise, register, or lade anything in the ships, which were all ready to sail to Nueva España. Thereupon the said visitor thought it advisable and necessary to repeal the said enforcement. Although the inhabitants, on that occasion, because of the great pressure exerted and the advantageous reasons put forward by the visitor, offered to aid with a gift of four thousand pesos, it was with the said condition that it was to be for only that one time, and with the said condition that nothing was to be said of the said collection.
Seventh, the great damage and injury that would assuredly follow to the royal treasury if the said commerce were abandoned; for since the said three per cent that is first collected as a customs duty, and the other three per cent imposed anew in the said year of six hundred and eleven, amount and are worth a very great sum and number of pesos annually to the royal treasury, that sum will not increase with the imposition of the said two per cent, but, on the contrary, both the one and the other duty will be lost; or at least they will be reduced to a very great loss, damage, and diminution of the royal treasury, and the reason therefor is very clear and evident. For in every year, and in that of the imposition of the two per cent of which we are treating, the duty amounted to about four thousand; and to that amount now, without the imposition of the said two per cent, all the inhabitants of the said city, both rich and poor, trade and traffic. By that means are caused the said customs duties not only at departure from the said city of Manila, but at entrance into the said City of Mexico, and on their returns afterward, from the investments, and on the kinds of merchandise that are sent back by the same ports and places to be traded at the said city of Manila. For since the number of those who traffic is large, the said duties which are caused and paid are also large. But if the said two per cent be put in force, although it may be stated that some of the said inhabitants will continue to trade, they would be very few; and the trade would be reduced to those who are richest and those with most capital, who are not many. But among all the others who are not rich, money and capital would fail, and they would refuse to [trade] and could not risk their little capital without gain or profit, as they will have no profit with the said two per cent. And it would not be right or expedient, for the sake of the said new imposition (since the reasons and motives for it are lacking, as above stated), to place the income and value of the said customs duties in danger and peril, as it is so great and considerable, or to risk that of the other three per cent of the said year 611—the one dependent on and inseparable from the other; for, beyond all doubt, both would fail if the said commerce failed or diminished. The said danger can be regarded as certain, both for the abandonment of the said commerce and of the colony of those islands; and that would allow the Dutch, who are so powerful in the surrounding islands, as above stated, to gain an entrance in them, for the lack of troops caused by the said imposition. That is a matter which your Majesty should have examined with great attention, because of the many precedents that have been seen in like cases in these kingdoms [i.e., of España] with the great injury and loss to the royal treasury which could not be restored later—as happened in the increase [of the tax] on playing cards, one real more than the usual tax being imposed. That income, being valued at that said time at from forty-four to forty-five million maravedis annually in the three districts of Castilla, Toledo, and Andalucia, dropped to twenty-two millions because of the new imposition, thereby losing a like sum annually. And, although the damage was afterward seen, and the attempt was made to correct it by repealing the said new imposition, and reducing the tax to the old amount, the amendment did not follow; for because of the frauds and cheats caused by the said income in its first condition, it never returned to that condition, and remained with the annual loss and decrease of fourteen million maravedis from what it had at the time of the said new imposition. The same thing happened in the thirty per cent which was imposed on the trade of foreign merchants while the court was in Valladolid. The result of that was that the foreign merchants abandoned the commerce, and looked for new methods, applying themselves to gaining a foothold in the Eastern Indias. The said imposition was thus the reason for the many important lands and ports of which the foreigners have gained possession and which they hold, which we have lost for the said reason. Both these instances are very certain, well-known, public, and notorious.