This explains briefly what the Europeans including the British were doing in Asia, but the question still remains why the British established a location in Singapore.
Circumstances explaining the choice of Singapore
Portugal emerged as the first strong European nation in Southeast Asia. It entered the continent through the Straits of Malacca (see map below for a better understanding of this section). During the 17th century the Dutch replaced the Portuguese power in Southeast Asia. The Dutch interest was centered to Batavia in Java and to the Spice Islands. Furthermore, the Dutch used Mauritius as a refreshment base, why they entered the Southeast through the Straits of Sunda which consequently was more important to them although they also had the power over the Straits of Malacca as they held Malacca, an important outpost to the Spice Islands. During the 17th century the turn came to the English to take a more leading role in the East, achieving to conquer large parts of India through their East India Company (EIC) which had a monopoly on basically all English trade with far away foreign countries.
English and France had been at war in the early 19th century. English won the war and emerged as the world’s leading naval power. English and Dutch had been allies in the war, but were maritime rivals in Southeast Asia. Britain had earlier, in the convention of 1814, promised an independent Holland as a condition for the peace in Europe. They therefore had to return the territories they had earlier conquered from Holland which included Java, Malacca and the Spice islands. The EIC tried to secure some British footholds from becoming Dutch, but the British government did not allow them to do so as it was against the convention of 1814. However, as the trade to China opened up, Stamford Raffles – an employee with EIC – did not want to miss out on the profitable trade with China. The goods that made China so interesting that were popular in Britain and Europe were in particular tea, porcelain and soap. In addition, the Dutch took back their territories at very high speed, which concerned Raffles further. He did not want the British to lose all good business opportunities in the Southeast to the Dutch and managed to convince the British government of the need to secure a post in the south of the Malacca Straits, as this would be a good location for trading with China as well as it would neutralize the Dutch sphere which after 1812 had become very strong in the area of the Malacca Straits. Raffles started looking for appropriate locations and first tried to establish a trading post in Riau, but the Dutch beat him. His next intention was the nearby Karimun Islands, but he did not find them suitable as they lacked fresh water. Being an old governor of Java, Raffles had studied Malay and had thereby learnt about Singapore, which came to be the next stop in the search for an outpost. Singapore was not only good located in the Straits of Malacca, but also had fresh water and in 1819 Raffles succeeded in making an agreement with the local chief Temenggong. However, the agreement only allowed Britain to establish a factory on the island; it did not make Singapore British. A more decisive event was the Anglo-Dutch treaty in 1824 which made Singapore a British possession.
As one might understand from this story, firstly EIC would probably not have established an outpost at all in the Straits of Malacca if Raffles’ had not convinced them although they had some interest in a strategic outpost in the Straits. Secondly, that Raffles came to choose Singapore, was also much an outcome of circumstance considering he visited other locations before Singapore but could not have them.
2. the subsequent growth of Singapore
Of the three settlements of Penang, Malacca and Singapore, Singapore had become the capital of the three of them in 1836. From 1824 to 1873 the value of total trade in Singapore grew from USD 12 million to USD 56 million and the population grew about nine times. The main explanation for the growth is that Singapore developed into one of the foremost trading centers in the Southeast. This development was strongly linked with Singapore status as a free port. However, before Raffles turned Singapore into a free port, he took several actions in order to secure Singapore British and deepen the British rule as this was a prerequisite for being able to introduce free trade and expand Singapore into the strategic location of trade as was originally intended.
Deepening of the British rule (1819-1824)
From 1819 to 1823 Raffles strengthened the British power over Singapore through consecutive measures. The first measure was to follow up the preliminary agreement one week later with another agreement that allowed EIC to establish several factories in Singapore, not only one, through a manoeuvre where he recognized Hussein as the Sultan of Johore although Raffles should have turned to Hussein’s brother.
The next step was to reduce the influence of the tripartite system of rule in Singapore and strengthen the British power. In 1819 Singapore was governed by three parts together, the Malay Sultan, Temenggong and the British Resident Farquhar. Raffles wanted to increase the British power as well as remove Farquhar as Raffles was dissatisfied with his administration. In 1823 Raffles managed to get rid of Farquhar and negotiate a new agreement with the others. British control was now extended over the whole island in exchange for paying allowances to the Sultan and Temenggong. Raffles also introduced new policies for land, port and juridical administration and to a large extent enforced British laws. All this happened before the Anglo-Dutch agreement in 1824 which secured British possession over Singapore and saved it from becoming Dutch. Raffles knew that the Dutch disliked EIC’s establishment of an outpost in Singapore in 1819. It is likely that it would have more difficult for Britain to claim that they should have Singapore, had they not undertaken all these measures which gave them quite strong control over Singapore already before the agreement in 1824. The British also gave away quite a lot of land to the Dutch in order to get Singapore which further strengthens the belief that they very much wanted Singapore and had a plan for how it could grow and make them wealthy.
Establishing Singapore as a free port
After 1824 and Singapore had been established British, Raffles developed Singapore into a free port with free trade, which was the main factor that catalyzed the growth of Singapore. Free trade meant no taxes on imports thereby allowing anyone who wished so to trade in Singapore. In addition, Raffles’ choose to have no rules or restrictions on the trading activities, which stimulated trade further. These choices were against the standard belief and practice at the time, mercantile trade.
In contrast to the Dutch and the rest of the world, Raffles was a believer in Adam Smith’s theory of free trade. The two theories differ in their view on how wealth is created. According to mercantilism, a country should export more than it imports in order to get a trade surplus consisting of gold or similar which makes the country wealthy. According to free trade, countries should trade as it increases productivity, which eventually increases wealth. In exercising free trade in Singapore, the trade activities increased in a way that would not have been possible if Raffles had adopted a mercantile view as Singapore has few goods to sell to other countries. Now Singapore could engage in entrepôt trade, the type of trading activity where people import goods from other countries and export the goods again to other places. The entrepôt trade lead to increased imports and exports and increased the general economic activity as it e.g. attracted merchants and created a need for other commercial activities, which eventually contributed to the development and growth of Singapore. In addition, the opium played an important role in the development of Singapore. It was from selling opium to China Singapore got its money.
Other factors contributing to the growth of Singapore
Besides the seemingly deliberate establishment of Singapore as British between 1819 and 1824, and the development of Singapore into a free port, there were other factors that contributed to the growth of Singapore. However, these factors are more of external character and why they are treated separately.
The Straits of Malacca were more attractive than the Dutch Straits of Sunda to the important Bugis traders. Bugis was a general name for all the traders from the east, and the Bugis were the principal carriers of trade in the Malay Archipelago. The Bugis sailing schedules were much determined by the monsoons and in this sense Singapore had an advantage over other trading ports such as Penang and Malacca. Singapore was also well placed for the Chinese junk trade and for western maritime carrying trade
Piracy was widespread, constituting a threat to the trade as the pirates’ main victims were the important Bugis and Chinese junk traders. Britain was at the time the world’s strongest industrial and naval power and used their power to eliminate piracy. Helped by the development of the steam-driven gunboat and with assistance from the Dutch and Spaniards, they together succeeded in rooting out piracy and securing the attractiveness of trading with Singapore.
The process of industrialization in Britain during the first half of the nineteenth century, created an urgent need to sell abroad. The goods were sold through “agency houses”, which were foreign merchants who sold on a commission basis.
The industrial revolution resulted in technological development such as the steamships. Together with the opening of the Suez Canal in 1869 this further stimulated trade as it made traveling faster. The use of steamships also created a need for coal depots, as the ships needed refill regularly and Singapore became a coal depot between Europe and China. In 1870 Singapore was linked to the main trading counterparts in the West by telegraphy. This enabled goods to be sold and bought while being transferred across the oceans and further stimulated trade.
To conclude, I would argue that the growth of Singapore during the early 19th century was more planned than the choice of Singapore as a location of EIC. The growth was more planned especially considering the actions taken by Raffles between 1819 and 1824 in order to secure Singapore as British in combination with establishing Singapore as free port, although other external factors also contributed to the growth.
References
Required readings
Lecture notes for session one and two
