WHAT WERE THE ECONOMIC ACTIVITIES OF NEW SPAIN? - HISTORY - 2024

The economic activities of New Spain were characterized by being subject to the requirements and needs of the Spanish peninsula. Mining, agriculture, commerce and industry stood out.

Several economic activities were developed that allowed the subsistence of those who lived in the area, but the emphasis was always on preventing a very evident development, to avoid granting power and autonomy to the colonies, and thus maintaining them as working peoples subordinate to Spain.

Old Casa de Contratación in Seville, administration of the economic activities of the Indies

The economy in New Spain: main activities

The main economic activities were mining, agriculture, livestock, trade and industry. The characteristics of each one will be detailed below:

1- Mining

The image represents the flow of minerals in New Spain. Mining exploitation allowed the development of fundamental commercial activities for this region. Source: National Library of Congress

Mining was an important economic activity because, from it, other activities arose that also played a fundamental role in the development of the region's economy.

Also, at that time the amount of precious metals was what determined how rich and powerful a person and a country were.

Between 1546 and 1548, large silver deposits were discovered in New Spain, especially in the Zacatecas area, which would later become the third largest silver generator in Mexico and the fifth in the world.

Mining was a lucrative activity for several reasons. Labor was very cheap, since they were indigenous people, who were practically slaves, or independent workers who accepted extremely low payments.

In the mining industry there was what was called the "real fifth", which was a tax that the miners' union had to pay to the Spanish crown (generally it was 20% of the product).

2- Agriculture

Agriculture became the main activity, because it was essential to generate the livelihood of the inhabitants of New Spain and livestock.

The development of mining also generated the growth of agriculture, since it was necessary to have crops near the mines to supply the newly created mining cities.

Agriculture was seen as an inferior activity, not worthy for the Spanish, the mestizos or the Creoles.

They acted as owners but did not participate directly in the process, but had black foremen who worked the land.

Among the products that were produced in New Spain, corn and beans stand out, among others. The Spanish introduced several new species in the area, whose planting prospered, such as oats, wheat, rice, coffee, banana, cocoa and different fruit trees, among other foods.

3- Livestock

Livestock also became more necessary thanks to the development of the mining industry, because it was necessary to have animal power for transportation and other tasks.

Beef and pork also met the demand for food of the inhabitants of New Spain.

Horses were introduced from Spain, which served in principle as transport for the nobles and later, by reproducing rapidly and lowering their price, in the middle of displacement for almost all the inhabitants of New Spain. Among other animals there were also pigs, sheep, goats, chickens and cows, and also mules and donkeys for loading work.

The difficulty of livestock production had to do with the little space available for its development. The ranchers ended up invading indigenous lands, which was detrimental to the crops of this original people.

There were some products that were prohibited in New Spain, because they wanted to avoid generating a producer that would compete with the products that were produced in Spain. For this reason, the cultivation of foods such as the vine or the olive were restricted.

4- Trade

As for internal trade, many merchants moved regularly along the roads that reached the mining towns.

In these areas, local markets were also created, which fostered the economic growth of the mining centers, and also fostered internal trade.

Marketing within New Spain had a monopoly through the Consulate of Merchants in Mexico City, an organization made up of the most important wholesale merchants, which bought all the products that arrived from Spain and from the eastern market.

Regarding foreign trade, in 1503 the Seville Trade House was created, through which everything related to trade between Spain and its colonies was controlled.

This entity issued permits, supervised merchandise, charged high taxes and imposed strong regulations; This created a commercial monopoly that led to the rise of piracy and smuggling.

As part of the existing commercial monopoly, it was forbidden for New Spain to trade with ports other than Cádiz and Seville, both located in Spain; and the ports of Panama, Cartagena de Indias and Veracruz, in America.

The only ones who had the right to have the privilege of commercialization were Spanish and naturalized foreigners.

Manufactured products were exported to New Spain, with the intention of not promoting the manufacturing industry in the region and thus avoiding the possibility of commercial competition.

Among the products of the exchange between Spain and New Spain, gunpowder, paper, silk and mercury stand out.

The idea was that New Spain would export the raw material to Spain, and then Spain would export the products already manufactured to New Spain, which slowed the development of industry in the Spanish colony.

5- Industry

Industrial development had many obstacles. It was not in Spain's interest for industry to develop extensively in its colonies, because this gave them power.

Then, there were many prohibitions such as the manufacture of silk, wine, olive oil, among other items. However, there were two industries that managed to develop: the so-called artisan workshop and the textile industry.

Various products were produced in the artisan workshops, such as furniture, toys and shoes, among others. Free men who had certain privileges worked in these workshops.

Instead, the textile industry was developed in factories called obrajes, which offered really degrading and very harsh working conditions.

Free men, blacks and Indians could work, and there they made fabrics, hats and blankets, among other products.

References

1. Gale Encyclopedia of US Economic History. "New Spain, Viceroyalty Of" (2000) in Encyclopedia. Retrieved on July 31, 2017 from Encyclopedia: encyclopedia.com.
2. Domínguez, H. and Carrillo, R. "Economic activities and social organization in New Spain" (January 2010) at the National Autonomous University of Mexico. Retrieved on July 31, 2017 from the National Autonomous University of Mexico: portalacademico.cch.unam.mx.
3. "History of Mexico 1" at the National Autonomous University of Mexico. Retrieved on July 31, 2017 from the National Autonomous University of Mexico: portalacademico.cch.unam.mx.
4. Hoyt, D. “The economy of New Spain: Mexico's Colonial era” (November 1, 1998) in Mexconnect. Retrieved on July 31, 2017 from Mexconnect: mexconnect.com.
5. Salvucci, R. "The Economic History of Mexico" in Economic History Association. Retrieved on July 31, 2017 from the Economic History Association: eh.net.
6. "Economy of New Spain" in Global Security. Retrieved on July 31, 2017 from Global Security: globalsecurity.org.