The first step towards a realization of these plans was taken when a charter was granted to the Dutch East India Company, which gave that organization the exclusive right to commerce beyond the Cape of Good Hope on the one side and the Straits of Magellan on the other side. As it recalled similarly privileged institutions in feudal times, when the rights of the classes engaged in trade and industry had to be protected against violation by noble lords, more properly called robber barons, the ideal this company represented appealed to the people. Statesmen of other countries realized its advantages and the Dutch East India Company became the model for the great trade corporations which eventually sprang up in France and England.

But the East alone could not engage all the forces of the active little country. The tales of the sailors and the books about the Western Hemisphere made the people look more and more longingly towards the continent and the islands across the Atlantic. There unlimited opportunities beckoned; there was an outlet for their energies. But unfortunately the Spaniards had long before this established their claims in that continent and the men at the helm of the Dutch government were determined to keep peace with Spain. Although Holland's great pioneer of the "freedom of the seas," Hugo Grotius, refers in his writings to the great plans upon which the Dutch were deliberating at the time when Captain John Smith sailed for Virginia, no step was taken in that direction until two years after the founding of Jamestown. The voyage of Henry Hudson up the river that bears his name, and the eventual establishment of the colony called Nieuw Amsterdam, did not conflict with any Spanish interests and opened the eyes of the enterprising people to other possibilities in the vast new continent. Before long the ships of the little confederacy were found in many harbors all along the Atlantic coast. They discovered some little islands in the West Indies, which the Spaniards had not found worth while to colonize, because their rocky structure was prohibitive to cultivation. So they did not hesitate to anchor their ships in the inlets of these islands and finally made them a center of contraband traffic with the continent.

The States-General of Holland still hesitated to grant a charter to the long-projected West India Company. But they found means to open to private enterprise almost unrestricted facilities for operation. On the twenty-seventh of March, 1614, they enacted a measure giving private individuals an exclusive privilege for four successive voyages to any passage, harbor or country they should hereafter find. This gave a powerful impetus to the enterprise of Dutch mariners and merchants, and also to adventurers of divers nationality. Finally on the third of June, 1621, the Dutch West India Company received a charter for twenty-four years with privilege of renewal, which gave it the right to traffic and plant colonies on the coast of America from the Straits of Magellan to the extreme north. The ships of the company immediately adopted the policy of reprisals on Spanish commerce. In the expedition of Pit Hein in 1628, which has been narrated in the previous chapter, the privateers of the company secured booty eighty times more in value than all their own exports for the preceding four years had amounted to. Dutch buccaneers became as much of a menace to Cuban ports and to the ships plying between Cuba and other countries as the French and British had been.

The sixty years of Philip IV.'s reign proved a long series of failures for Spain. They would have resulted in serious disadvantage to the American possessions, and especially to Cuba, had not the immediate successors of Cabrera in the governorship of Cuba been able men who managed the affairs of the island with sagacity and foresight. D. Juan Bitrian de Viamonte, Caballero de Calatrave, a native of Navarre, was appointed head of the administration and entered upon his duties on the seventh of October, 1630. As auditor of the interior was appointed the Licentiate Pedro so who a few months later was succeeded by D. Francisco Rege Corbalan. One of the most famous religious institutions in the West Indies was founded about this time. A pious woman, known as Sister Magdalen de Jesus, opened a retreat for women devoting themselves to a religious life; it was at first called Beaterio, but subsequently became known far and wide as the convent of the nuns of Santa Clara.

Governor Bitrian de Viamonte was neither strong of physique nor of personality; yet he discharged the functions of his office most successfully. During his administration was projected the construction of two towers, one in Chorrera, the other in Cojimar. The garrison of the place was increased and Castellane was made a respectable stronghold. He also organized the militia, creating six companies in Havana, two in Santiago and two in Bayamo. He had, however, serious disagreements with the Marquis de Cadreyta, and being something of an invalid and considered unfit to defend the island against the attacks of some powerful enemy, he was removed to the comparatively easier post of Captain-General of Santo Domingo. His successor was the Field-marshal D. Francisco Riano y Gamboa, a native of Burgos. He suffered shipwreck on the coast of Mariel while on his voyage from Spain and lost everything but his patents, but was duly inaugurated on the twenty-third of October, 1634.

The precautions taken by his successor to insure an effective defense of the island were by no means superfluous. For as the power of Spain was steadily declining, that of the Netherlands and of England was rising. The establishment of the Dutch along the Hudson, their founding of Nieuw Amsterdam and their settlements on some of the minor West Indies, had brought the danger of Dutch invasion nearer than ever before. The colonies founded by the British at Jamestown and Plymouth had brought within reach the eventuality of having to guard the Spanish possessions against the British as well. Dutch and British navigation on the Atlantic was vastly increasing and the future foreshadowed conflicts of the interests of Spain and Holland on the one, and Spain and England on the other side. The Cuban authorities, wrought up and kept in a perpetual state of tension by their experiences with the buccaneers, had become morbidly susceptible to danger of any kind. The appearance of a foreign ship in the neighborhood of Cuban waters sufficed to fill them with the gravest apprehension, lest the stranger might harbor hostile designs.

These apprehensions were justified, for the Dutch soon resumed their operations against Cuba. It was reported that Maurice of Nassau himself had set out with a powerful squadron, though no historian has any record of it. But in July, 1638, Cornelius Fels, who was by the Spaniards called Pie de Palo, appeared in the Bahama Channel, and from that point sailed for Havana at the head of a fleet of some twenty Dutch vessels enforced by some filibusters. Pie de Palo took his post at a convenient place to intercept any message sent by Governor Riano to Mexico or Peru. Near the coast of Cabanas the fleet of the Spaniards, commanded by D. Carlos Ibarra and composed of seven badly armed galleons and hookers, came across the Dutch. Ibarra formed a battle line extending his vessels so as to flank the enemy. Pie de Palo with six of his galleons bravely attacked the Spanish ships Capitana and Almirante, being under the impression that they carried a great quantity of coined money and bars of gold and silver.

Relying on the experience and the valor of Ibarra and Pedro de Ursua, who commanded the two vessels so proudly attacked by Pie de Palo, the captains Sancho Urdambra, Jacinto Molendez, the Marquis de Cordenosa, Pablo Contreras and Juan de Campos endeavored in the mean time to check the other galleons of the enemy. The unequal combat between Ibarra and Ursua and the Dutch vessels lasted eight hours and the brave Spanish sailors issued from it as victors. Pie de Palo was seriously wounded, more than four hundred Dutchmen were killed and three of their vessels were destroyed. The enemy fled, pursued by Ibarra, who returned to Vera Cruz after saving the honor of the Spanish flag and the riches the fleet had carried. They sang a Te Deum in Mexico as thanksgiving for the victory and King Philip IV. rewarded Ibarra and his men by rich gifts. The success of this expedition awakened in Havana the old spirit of adventure and military prowess. Cuba had so far been the victim of piracy and privateering; now it decided to defend her rights by fitting out her own privateers and sending them against the enemy. The first encounter was with corsairs that had been lying in wait for a vessel coming from Vera Cruz; the Cuban who distinguished himself in the command of the expedition which frustrated the enemy's designs, was Andres Manso de Contreras.

The demand for ships suitable for undertakings of this kind was so great that the ship-builders Carera and Perez of Oporto were kept busy building vessels for that purpose.

The administration of D. Francisco Riano y Gamboa was short, but some important measures were enacted in that period. The Exchequer Tribunal de Corientes was established with a single auditor for the royal chests of Cuba, Puerto Rico, Florida and other Spanish possessions. When it was subsequently found that the duties were too numerous for one man, a second official was appointed. It was then arranged that while one of the auditors was to remain in Cuba, the other was alternately to visit the other cajas (chests). In this way the government tried to avoid delays and complications which had caused considerable trouble. At this period, too, a commission of the Inquisition of Carthagena, elsewhere generally abolished, established its residence in Havana. Ecclesiastical life assumed greater proportions and a wider sphere of influence. Bishops who had previously looked upon Havana as an undesirable place of residence, no longer hesitated to accept a call to that city.