130 THE WEALTH AND POVERTY OF NATIONSa far stronger Indian government marched in and took it over, with
out provocation or pretext. No self-respecting independent country
could live with such a colonial boil on its flank.
Portugal's primary commercial objective in the East was to obtain
pepper and other spices and ship these directly to Europe, bypassing
the intermediaries that encumbered the traditional traffic across Asia
and into the Mediterranean.* This the Portuguese did by purchase or
seizure, compensating by force for the obstacles that Muslim mer
chants put in their way. In the early decades, these measures garnered
a large share of the trade. At the peak, some 40 percent of the pepper
imported into Europe was going around the Cape of Good Hope,
and the Venetians were hurting. But with time, the older trade routes
reasserted themselves. The direct Portuguese share fell back to about
20 percent, still important but no longer dominant. In 1570, the Por
tuguese crown gave up its monopoly of the trade between Lisbon and
the east (Goa). The king ceased to be a merchant and instead sold
concessions, frequently to foreign traders. In 1586, the German mer
chant house of Welser leased the exclusive rights to purchase pepper in
the Indies. The sale marked ebbtide. The Portuguese were selling an
empty hand.^3
(These figures of market share are grossly approximate. We have no
aggregate data.^4 But we do know that Venice, drawing on overland
shipments to the Levant, once again found itself Europe's key pepper
emporium in the latter part of the sixteenth century. When the news
came of the first successful Dutch voyages to the East Indies [Cornells
Houtman, 1595], Venice, as well as Portugal, could see the imminent,
"utter overthrow" of the older trade.^5 By 1625, the Venetian customs
classified spices as "western commodities": they now came from the At
lantic rather than the Near East.)
To make up for the shrinking spice trade, the Portuguese got into
intra-Asian exchange. This had flourished well before the Europeans
came: Gujrati, Javanese, and Chinese merchants trading pepper and
spices for Indian and Chinese textiles and Chinese porcelain; Arab mer
chants walking and shipping slaves from Africa throughout the Mus-
- The potential margins of profit were substantial. The one ship that survived Mag
ellan's circumnavigation of the globe brought back 26 tons of cloves, which were sold
for 10,000 times cost, just about enough to cover the cost of the expedition—Hum
ble, The Explorers, p. 162. (Note that cloves were probably the most valuable spice of
all in proportion to weight: a small bag constituted a fair bounty for a seaman over and
above wages.) Needless to say, such fabulous differentials rapidly narrowed as other
sources of supply responded to the competition.