European Influence on World Economy from 1850 – 1920

1 January 2017

In the 19th and 20th centuries, Europe continued to shape and influence the world through strong-arming global trade, modernization, and colonization. European countries physically and/or economically controlled lands in Africa, Latin America, and the Middle East to export cash crops, creating economic dependence; this, in turn, inhibited modernization. In the late 19th century, Africa was partitioned among the European powers strictly for profit. China was plagued with internal conflicts in the 19th century, as the government resisted Western philosophy.

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Japan came out of seclusion in 1865 and successfully combined old traditions with western philosophies. Egypt failed to industrialize after Muhammad Ali’s death, and fell to the exploitation of the British. Latin America achieved independence by 1820; but without social change, they remained economically dependent on Europe and the world market. The countries that were able to industrialized would continue to progress, while the others remained stagnate. At the conclusion of the age of exploration and the depression of the 1870s, European firms received significantly less for African goods.

To solve this problem, European firms established bases inside Africa to cut out the African middleman. In 1884, at the Berlin Conference, Africa was partitioned among the great European powers for development. Superior firepower, such as rapid-fire weapons and armed steamboats, along with organized dynamic strategies, were able to suppressed African resistance, even when seriously out numbered (Savrianos Africa). Europeans used local chiefs to gain the cooperation of the African people, and by 1914, Europe had colonized the majority of the continent of Africa (Savrianos Africa).

Colonization was the first step toward bringing Africa into the global world market. European firms focused on exploiting African cash crops. With Europeans controlling the economy through industrial and financial monopoly, well-connected firms managed the resources exported from Africa; the most profitable being mineral and agricultural. There were three regional patterns of African integration into the world economy: cash crops from African farmers, European concession owning companies, and European settlers and mining companies (Savrianos Africa).

The building of railroads in Africa assisted in the expansion of cash crops into the European market (Savrianos Africa). Private European firms brought African resources into the world market at the expense of African farmers and peasants. The European occupation of Africa from 1850 to 1914 had an enormous impact to both the African culture and economy. The missionaries had a great effect on African culture because they were the first Europeans who sought to change it; utilizing the principles of religion, medicine, and education.

By 1900 most of the teaching was done by Africans (Savrianos Africa). The new educated/ thinking generation began to discount the old ways and questioned colonialism. This led to tribal resentment against the Europeans. The commodities leaving Africa flooded global markets, firms provided work to the peasant class, and the African economy was booming. However, Europeans dictated the African market, causing a damper to the newly educated and African industrialism. After the conclusion of the first opium war in 1842, European powers continued to intertwine themselves with China.

In 1856, after supposed diplomatic disrespect, the English, one again, declares war on China. Another imperial list of demands was gained by the English to include: deeper penetration into china with 11 new treaty ports, unlimited travel in the interior in China, more territory near Hong Kong, and the re-legalization of opium, further weakening an already unstable government (Mayer, “China”). In 1874, France established a protectorate over Vietnam, and in 1882 occupied Hanoi near the Chinese border. Inevitably the French and Chinese went to war.

The French were victorious and won the right to colonize Vietnam in 1185. China vowed to strengthen its armed forces, and by 1885 China had the strongest Asian navy, although it later defeated by the Japanese in 1894. European imperialism benefitted Europe while perpetuating Chinese civil conflicts. The Boxers tried to rid China of European influence. A secret society based around the martial arts experts called the Boxers, Vowed to save China and rid the empire of the Western enemies. In 1900 Boxer riots ensued Beijing, violently killing a Japanese diplomat and burning Christian churches.

With the Empress’ support, war was declared on the West. By July 1900 the European powers maintained a force of 31,000 troops causing the Empress to flee to the north and the defeat of the Boxers. Rather than dismantling the empire, the Boxer protocol was signed in September 1901. This protocol required China to make a public apology, execute all levels of the Ching government, as well as westernize (Mayer “China”). Following years of revolts, the Ching dynasty finally fell in 1912. European influence leads Japan to modernize. In 1865 Japan ended the long era of seclusion from the outside world.

In 1868 the emperor proclaimed the Charter Oath, freeing people to peruse their own interests. This caused a social shift leading to the end of the age of the untouchable samurai class in 1877. The Meji government realized it needed to quickly industrialize and began to invest in the infrastructure of Japan. Japan relied upon private entrepreneurs for basic, rapid economic growth and the purchase of government industries. Education laws also sent Japanese to European and American schools to bring back and establish a Japanese education system.

Japan took and designed their government from various European models; in 1881 the first political parties emerged in Japan. In 1890 Japan had conducted its first elections under the new constitution and a bureaucracy based on college graduates. By 1900 Japan had a sense of achievement after rapidly industrializing and their numerous victories over China, Russia, and Korea (Mayer “Japan). In the early 19th century, Egypt began to grow and expand. In 1805 the Ottoman Sultan declared Muhammad Ali the governor of Egypt where he began to conquer his opponents to expand and control trade in and out of Egypt.

Muhammad Ali encouraged the growing of cotton for the European market to fund industrialization and the education of Egyptians abroad. Muhammad Ali’s monopoly over trade routes began to conflict with the British plans for the Middle East; additionally, he had several conflicts with the Ottoman Sultan and threatened the Turkish capital. In 1939, after another rebellion, Muhammad Ali was forced by the British to back down; in return he was granted Egypt and was told to remain a subject of the Ottoman Empire. This was the end of the Egyptian expansion.

After Muhammad Ali’s death in 1849, Egypt fell to British mercy and all modernization would eventually come to a halt. Muhammad Ali’s successors left Egypt bankrupt and serious instability ensued; the result was the British occupation of Egypt in 1882. Egyptian agriculture became so completely dominated by cotton for the English mills, grain had to be imported to feed the rural population (Mayer “Egypt”). The cotton and Suez Canal were vastly important to the British economy and Mediterranean defense, despite repeated protest from Egypt, the Egyptians would not be declared an independent monarchy until 1922.

Even after independence, the British military continued to occupy Egypt. The British suppression on Egypt forever changed the region and directly led to underdevelopment of the nation. Latin America declared independence just to remain economically dependent. In the mid 1820’s Latin America had had broken trade monopolies and liberated from direct European dictatorship. The Creole victors remained in control allowing no revolutions or significant changes to social or economic structures to occur.

With old trading patterns disrupted and domestic funds low, Latin American governments and businesses turned to Britain for protection, markets, and capital investments (Craig 767). This reliance would continue to hinder progression on most Latin American countries until the 1950s. Like Africa and Asia, Latin America would specialize in the exportation of specific commodities to feed the growing world economy. Although Latin America had to import most of its finished goods and demand for their commodities were based on foreign demand, Latin America was very prosperous from 1870 to 1930.

Europe and the United States had a demand for foods such as wheat and beef, tropical products like bananas, sugar and coffee, and metals such as copper (Craig 774). Because of the cycle of exporting commodities to import finished goods, declines in prices and the need for raw materials always hit Latin America first and lasted there the longest (Craig 774). The economy of specialized exportation would leave Latin America with little control over their economy, even in good times. Latin America failed to modernize.

Due to the political philosophies embraced by the Creole elites, no one challenged social order. This, tied to the dependence on foreign markets for niche commodities, led Latin America to become under developed and discouraged the need for modernization (Craig 784). Latin Americans still thought of land as the biggest domestic investment and foreigners had little reason to invest capital in Latin American industrialization because it could cut into their own profits from importing finished goods (Craig 774).

In the 1920s the United States would trade places with Great Brittan and become the next major trading partner with Latin America, ensuring the continuance of their economic dependence (Craig 775). Without modernization and with their current exporting approach, Latin America would have too narrow of a base for self-sustaining economic success. European powers were able to influence and shape word history through their ability to exploit niche economies around the globe.

Through colonization, Africa was brought into the growing world economy, but Africans were held back by the control of European firms. China struggled to maintain civil order while falling to European penetration and ideas. Japan, on the other hand, embraced the modern social structure of Europe and the west, and became modern and self-sustaining. Egypt became socially stagnate after English occupation and the exploitation of Egyptian cotton. Even when Latin America was doing well, they remained dependant on Europe and were unable to control their own economy.

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