Indonesia VOC Bankruptcy and the British Occupation
Source: The Library of Congress Country Studies
Not only continuous wars on Java but also the VOC's own greed and shortsightedness led to its undoing by the end of the eighteenth century. Its personnel were extraordinarily corrupt, determined to "shake the pagoda tree" of the Indies, to use a phrase popular with its eighteenth-century British contemporaries, to get rich quick. Although the VOC preserved its monopoly over the spice trade, it could not prevent foreign rivals, especially the British and French, from growing spices on their own territories in the West Indies and elsewhere. Thus, European markets were assured a cheap supply. Moreover, the development in Europe of winter forage in the late seventeenth century made spices less of a necessity, since livestock did not have to be slaughtered in autumn and its meat preserved with spices over the cold season. War between the Netherlands and Britain in 1780-84 also prevented the VOC from shipping its goods.
The VOC turned to new cash crops and products: pepper and textiles from Sumatra, and coffee and tea grown in the mountainous Priangan Districts. In Priangan, inhabited by people of the Sundanese ethnic group, the local rulers collected coffee from cultivators and delivered it to the VOC. Coffee became Java's most profitable crop from the early eighteenth to the mid-nineteenth century. But despite such diversification, the Dutch StatenGeneraal in 1789 discovered the company had a deficit of some 74 million guilders. The Netherlands was occupied by French troops in 1795, and a French protectorate established. The new government abolished the VOC by allowing its charter to lapse in 1799. VOC territories became the property of the Dutch government.
In 1808 Louis Bonaparte, who had been made king of the Netherlands by his brother Napoleon, appointed Herman Willem Daendels as governor general of the Dutch possessions. Daendels, imbued with the ideas of the French Revolution, had scant patience for the intricacies of Java's "feudal" political system and introduced a comprehensive set of reforms. In doing so, he earned the hostility of the Javanese nobility who had benefited from the old system of indirect rule. But in 1811, a year after the Netherlands had been incorporated into the French empire, the British occupied Java. In August 1811, they seized Batavia and a month later received the surrender of French forces.
Thomas Stamford Raffles was appointed lieutenant governor of Java (1811-16) and its dependencies by the British East India Company in Calcutta. Raffles, best known for being the founder of Singapore in 1819, attempted, like Daendels, comprehensive reform. Many of his ideas were enlightened: abolition of forced labor and fixed quotas for cash crops, peasants' free choice of which crops to grow, salaries for government officials, abolition of the slave trade in the archipelago, and improvement of the lot of slaves (his goal of total opposition to slavery was deemed impractical). Raffles also sponsored the establishment of a subsidiary court, Pakualaman, in Yogyakarta in 1812, further dividing the authority of the Yogyakarta sultanate. But there was little time for these efforts to take root. At the outset of the Napoleonic Wars, the British government had promised the Dutch government-in-exile that at the end of the war occupied territories would be returned to the Netherlands. Over the objections of Raffles, Dutch authority was reestablished in 1816.
Data as of November 1992
NOTE: The information regarding Indonesia on this page is re-published from The Library of Congress Country Studies. No claims are made regarding the accuracy of Indonesia VOC Bankruptcy and the British Occupation information contained here. All suggestions for corrections of any errors about Indonesia VOC Bankruptcy and the British Occupation should be addressed to the Library of Congress.