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The Chartered Trading Companies as Modern Multinationals

The trading nation[edit]

The 18th century was prosperous as entrepreneurs extended the range of their business around the globe. By the 1720s Britain was one of the most prosperous countries in the world, and Daniel Defoe boasted:we are the most “diligent nation in the world. Vast trade, rich manufactures, mighty wealth, universal correspondence, and happy success have been constant companions of England, and given us the title of an industrious people.”[25]

While the other major powers were primarily motivated toward territorial gains, and protection of their dynasties (such as the Habsburg and Bourbon dynasties, and Prussia’s House of Hohenzollern), Britain had a different set of primary interests. Its main diplomatic goal (besides protecting the homeland from invasion) was building a worldwide trading network for its merchants, manufacturers, shippers and financiers. This required a hegemonic Royal Navy so powerful that no rival could sweep its ships from the world’s trading routes, or invade the British Isles. The London government enhanced the private sector by incorporating numerous privately financed London-based companies for establishing trading posts and opening import-export businesses across the world. Each was given a monopoly of trade to the specified geographical region. The first enterprise was the Muscovy Company set up in 1555 to trade with Russia. Other prominent enterprises included the East India Company, and the Hudson’s Bay Company in Canada. The Company of Royal Adventurers Trading to Africa had been set up in 1662 to trade in gold, ivory and slaves in Africa; it was reestablished as the Royal African Company in 1672 and focused on the slave trade. British involvement in the each of the four major wars, 1740 to 1783, paid off handsomely in terms of trade. Even the loss of the 13 colonies was made up by a very favorable trading relationship with the new United States of America. British gained dominance in the trade with India, and largely dominated the highly lucrative slave, sugar, and commercial trades originating in West Africa and the West Indies. Exports soared from £6.5 million in 1700, to £14.7 million in 1760 and £43.2 million in 1800.[26] Other powers set up similar monopolies on a much smaller scale; only the Netherlands emphasized trade as much as England