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Financial Success

Trade at Singapore had eclipsed that of Penang by 1824, when it reached a total of Sp$11 million annually. By 1869 annual trade at Singapore had risen to Sp$89 million. The cornerstone of the settlement's commercial success was the entrepôt trade, which was carried on with no taxation and a minimum of restriction. The main trading season began each year with the arrival of ships from China, Siam, and Cochinchina (as the southern part of Vietnam was then known). Driven by the northeast monsoon winds and arriving in January, February, and March, the ships brought immigrant laborers and cargoes of dried and salted foods, medicines, silk, tea, porcelain, and pottery. They left beginning in May with the onset of the southwest monsoons, laden with produce, spices, tin, and gold from the Malay Archipelago, opium from India, and English cotton goods and arms. The second major trading season began in Septeember or October with the arrival of the Bugis traders in their small, swift prahu, bringing rice, pepper, spices, edible bird nests and shark fins, mother-of-pearl, gold dust, rattan, and camphor from the archipelago. They departed carrying British manufactures, cotton goods, iron, arms, opium, salt, silk, and porcelain. By mid-century, there were more than twenty British merchant houses in Singapore, as well as German, Swiss, Dutch, Portuguese, and French firms. The merchants would receive cargoes of European or Indian goods on consignment and sell them on commission.

Most of the trade between the European and Asian merchants was handled by Chinese middlemen, who spoke the necessary languages and knew the needs of their customers. Many of the middlemen had trained as clerks in the European trading firms of Malacca. With their experience, contacts, business acumen, and willingness to take risks, the middlemen were indispensable to the merchants. For the Chinese middlemen, the opportunities for substantial profit were great; but so were the risks. Lacking capital, the middlemen bought large quantities of European goods on credit with the hope of reselling them to the Chinese or Bugis ship captains or themselves arranging to ship them to the markets of Siam or the eastern Malay Peninsula. If, however, buyers could not be found or ships were lost at sea, the middlemen faced bankruptcy or prison. Although the merchants also stood to lose under such circumstances, the advantages of the system and the profits to be made kept it flourishing.

The main site for mercantile activity in mid-century Singapore was Commercial Square, renamed Raffles Place in 1858. Besides the European merchant houses located on the square, there were in 1846 six Jewish merchant houses, five Chinese, five Arab, two Armenian, one American, and one Indian. Each merchant house had its own pier for loading and unloading cargo; and ship chandlers, banks, auction houses, and other businesses serving the shipping trade also were located on the square. In the early years, merchants lived above their offices; but by mid-century most had established themselves in beautiful houses and compounds in a fashionable section on the east bank of the Singapore River.

Construction of government buildings lagged far behind commercial buildings in the early years because of the lack of taxgenerated revenue. The merchants resisted any attempts by Calcutta to levy duties on trade, and the British East India Company had little interest in increasing the colony's budget. After 1833, however, many public works projects were constructed by the extensive use of Indian convict labor. Irish architect George Drumgold Coleman, who was appointed superintendent of public works in that year, used convicts to drain marshes, reclaim seafront, lay out roads, and build government buildings, churches, and homes in a graceful colonial style.

Probably the most serious problem facing Singapore at midcentury was piracy, which was being engaged in by a number of groups who found easy pickings in the waters around the thriving port. Some of the followers of the temenggong's son and heir, Ibrahim, were still engaging in their "patrolling" activities in the late 1830s. Most dangerous of the various pirate groups, however, were the Illanun (Lanun) of Mindanao in the Philippines and northern Borneo. These fierce sea raiders sent out annual fleets of 50 to 100 well-armed prahu, which raided settlements, attacked ships, and carried off prisoners who were pressed into service as oarsmen. The Illanun attacked not only small craft from the archipelago but also Chinese and European sailing ships. Bugis trading captains threatened to quit trading at Singapore unless the piracy was stopped. In the 1850s, Chinese pirates, who boldly used Singapore as a place to buy arms and sell their booty, brought the trade between Singapore and Cochinchina to a standstill. The few patrol boats assigned by the British East India Company to protect the Straits Settlements were totally inadequate, and the Singapore merchants continually petitioned Calcutta and London for aid in stamping out the menace.

By the late 1860s, a number of factors had finally led to the demise of piracy. In 1841, the governor of the Straits Settlements, George Bonham, recognized Ibrahim as temenggong of Johore, with the understanding that he would help suppress piracy. By 1850 the Royal Navy was patrolling the area with steam-powered ships, which could navigate upwind and outmaneuver the pirate sailing ships. The expansion of European power in Asia also brought increased patrolling of the region by the Dutch in Sumatra, the Spanish in the Philippines, and the British from their newly established protectorates on the Malay Peninsula. China also agreed to cooperate in suppressing piracy under the provisions of treaties signed with the Western powers in 1860.

Singapore's development and prosperity at mid-century were largely confined to the coast within a few kilometers of the port area. The interior remained a dense jungle ringed by a coastline of mangrove swamps. Attempts to turn the island to plantation agriculture between 1830 and 1840 had met with little success. Nutmeg, coffee, sugar, cotton, cinnamon, cloves, and indigo all fell victim to pests, plant diseases, or insufficient soil fertility. The only successful agricultural enterprises were the gambier and pepper plantations, numbering about 600 in the late 1840s and employing some 6,000 Chinese laborers. When the firewood needed to extract the gambier became depleted, the plantation would be moved to a new area. As a result, the forests of much of the interior of the island had been destroyed and replaced by coarse grasses by the 1860s, and the gambier planters had moved their operations north to Johore. This pressure on the land also affected the habitats of the wildlife, particularly tigers, which began increasingly to attack villagers and plantation workers. Tigers reportedly claimed an average of one victim per day in the late 1840s. When the government offered rewards for killing the animals, tiger hunting became a serious business and a favorite sport. The last year a person was reported killed by a tiger was 1890, and the last wild tiger was shot in 1904.

Data as of December 1989

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Singapore Table of Contents