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A History of Spain by Charles E. Chapman

The intervention of foreigners in the commerce of Spain

by making loans to the crown,

which brought about their ruin. At the end of the eighteenth century there were fourteen _consulados_ in Spain, each differing from the others but all following rather closely the new ordinances (1737) for the _consulado_ of Bilbao as a type. In the smaller cities and towns local officials were wont to appoint two men as _diputados de comercio_ (commercial deputies) to act for that neighborhood in the capacity of a _consulado_. There were various other mercantile groups of a more clearly private character, and their associations were encouraged by the government. The so-called "five greater guilds of Madrid," including dealers in jewelry, silks, gold and silver ware, cloths, linens, spices (and groceries?), and drugs, was the most important of these organizations. Its business was so enormous that it extended beyond Madrid to other cities, and put up factories for the manufacture of the goods it sold. In 1777 there were 375 merchants in this corporation, with a capital of some 210,000,000 _reales_ ($13,125,000). Other associations were formed for special objects, such as to buy goods in great quantities and therefore more cheaply, or to carry merchandise in their own ships. Many companies were organized specifically for trading with the Americas. In the fluctuations of commerce one fact stood out consistently: the balance of trade was heavily against Spain. In 1789 exports were valued at 289,973,980 _reales_ (about $18,000,000) as against imports of 717,397,388 (nearly $45,000,000).
Internal commerce amounted to an estimated 2,498,429,552 _reales_ (about $156,000,000). The wars of the reign of Charles IV almost destroyed Spanish commerce. C?diz in particular was a heavy loser.

[Sidenote: Important place of foreigners in Spanish commerce.]

The intervention of foreigners in the commerce of Spain, which had given so much concern in the previous era, was an even greater problem under the Bourbons. Many factors contributed to make this the case: the industrial decline of the seventeenth century, which favored the importation of foreign goods; the eighteenth century efforts for an economic revival, which led to the seeking out of foreign models and foreign teachers or workmen; the encouragement given to Frenchmen as a result of the Bourbon entry into Spain; and defeats in war, which necessitated Spain's submission to the exactions of her opponents (many of whom insisted upon commercial privileges) or the legalization of trade usurpations which they had indulged in without right. In the Americas the English were the most prominent element, but in Spain the French were. The leading French merchants established themselves in C?diz, the gateway of the Americas, whence they proceeded to absorb a great part of Spain's profits from the new world. In 1772 there were seventy-nine French wholesale houses in C?diz, making an estimated annual profit of 4,600,000 _reales_ (nearly $300,000). In 1791 there were 2701 Frenchmen in that city out of a total foreign population of 8734. Numerically, the Italians were more in evidence, for there were 5018 of them, mostly Genoese. There were some Englishmen, too, whose aggregate capital made up for their small number. In general the legislation of the era was favorable to foreigners. Their knowledge and labor were so greatly desired that they were even granted special privileges or exemptions to take up their residence in Spain, and the religious bar was ameliorated or utterly withdrawn. Popular opinion was against them, however, and the laws were not wholly free from this influence. Men complained, as formerly, that the foreigners were making immense profits and stifling Spanish competition, while the hatreds engendered by the wars with England and France and by the scant respect and haughty manners which some foreigners displayed for the laws and customs of Spain tended to increase the feeling of opposition. Foreigners were often ill-treated, although the acts were rarely official. Even the government did not recognize consuls as having any special rights or immunities differentiating them from others of their nation. A further accusation against foreigners was that they engaged in contraband trade. This was true, although as a rule it was done in complicity with corrupt Spanish officials. Foreigners justified themselves on the ground that unless they were willing to make gifts to Spaniards in authority they were obliged to suffer a thousand petty annoyances. "Money and gifts," said the French ambassador, Vaulgrenant, "have always been the most efficacious means of removing the difficulties which can be raised, on the slightest pretext, against foreign merchants. That has been the recourse to which the English have always applied themselves, with good results." The fact remains, however, that the French, English, and others had entered the commercial field in Spain and Spanish America to stay.

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