Imperialism and Global Economy

Imperial Powers and Colonial Economies

One of the main goals during the second wave of imperialism was industrialized states taking over and colonizing land to obtain raw materials for factories to produce manufactured goods.

  • Imperial powers transformed colonial economies into export economies.
  • These economies were primarily focused on exporting raw materials or goods for distant markets.

Shift from Subsistence Farming

Prior to colonization:

  • Many people in Africa, Southeast Asia, and the Americas were subsistence farmers.
  • They grew a variety of foods for their families to consume and survive.

After imperial powers colonized:

  • They reorganized colonial economies around the export of one or two cash crops or natural resources.

Example: A colonized territory with soil good for growing cotton.

  • The imperial state forces farmers to grow only cotton for their textile factories.
  • Or they focus solely on extracting resources like copper or diamonds.

Imperial powers fundamentally transformed colonial economies to extract natural resources or produce industrial crops for their benefit.

Causes of Economic Transformation

Need for Raw Materials

States needed raw materials for industrial factories to maintain power.

  • Exploiting colonies was seen as acceptable to obtain these materials.

Examples:

  • Egypt and India relied on exporting cotton to Britain after the US Civil War disrupted supply.
    • By the late 19th century, almost the entire Egyptian economy was dedicated to exporting cotton to Britain.
  • Palm oil extraction in West Africa used enslaved labor to establish palm oil plantations.
    • Palm oil was crucial for manufacturing goods (soap) and lubricating factory machines.
  • Guano extraction on Pacific and Atlantic Islands.
    • Bird poop was used as fertilizer for industrial crop operations.

Supplying Food to Urban Centers

Industrialization led to urbanization, increasing the need for food in cities.

  • Colonial economies shifted to cash crop cultivation of foods like sugar and coffee.
  • Industrial ranching operations in Argentina and Brazil met growing meat demand in industrial nations.

Effects of Global Economic Developments

Profits and Trade

Profits from exports were used to purchase finished manufactured goods.

  • Colonies provided a closed market for manufactured goods from industrial states.
  • Imperial states manufactured more goods than their populations could buy, so they needed other markets.
  • Colonial economies shifted to cash cropping and had to purchase necessities on the world market.
  • Profits from exporting resources or minerals went to purchasing manufactured goods from imperial states.

Economic Dependence

Colonial people became economically dependent on their imperial parents.

  • The reorganization of colonial economies served the interests of the colonizing powers, not the indigenous people.
  • Imperial states organized colonial economies for their benefit, increasing the dependence of colonial peoples on them for their well-being.