The Impact of Plantation on the Economy of Cuba

A plantation is always a monoculture over a large area and does not include extensive naturally occurring stands of plants that have economic value. Because of its large size, a plantation takes advantage of economies of scale. Protectionist policies and natural comparative advantage have contributed to determining where plantations have been located.

Among the earliest examples of plantations were the latifundia of the Roman Empire, which produced large quantities of wine and olive oil for export. Plantation agriculture grew rapidly with the increase in international trade and the development of a worldwide economy that followed the expansion of European colonial empires.

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Like every economic activity, it has changed over time. Earlier forms of plantation agriculture were associated with large disparities of wealth and income, foreign ownership and political influence, and exploitative social systems such as indentured labour and slavery the history of the environmental, social and economic issues relating to plantation agriculture is covered in articles that focus on those subjects. Its geographic location and resource endowment had made the country rely on foreign commerce for its prosperity.

Colonial administration and institutions were weak, as compared to Mexico or Peru. Catholic Church held sway over the faith and wealth of the island. Overall, the colony remained until the end of the 17th Century, virtually stagnated, challenged by pirates, ravaged by hurricanes, plagued by diseases and depopulated by the magnetic pull of Mexico and Peru.

Cuba’s importance began changing around the middle of the 18th Century only with the development of sugar plantation economy and the emergence of a powerful and very cohesive planter’s class-called sucarocracia. The timing of the rise of plantation economy was very important.

It coincided with the industrial revolution in England, which led to the introduction of steam engine in the refining process of sugar. Its geographic location ideally suited the American and trans- Atlantic trade routes and its climatic conditions were just perfect for a plantation economy to emerge.

Other factors of production namely labour came in the form of African slaves. By the time slavery came to an end in the middle of the 19th Century, some 375,000 black slaves had been brought to Cuba.

Foreign investment and the rapid introduction of modern technology and management soon converted Cuba into the sugar bowl of the world. The rise of British naval power and British design to monopolise the international trade in sugar endowed Cuba with even more importance.

Cuba would retain, what Liberal economists call, the comparative advantage in sugar; and sugar has decided its economy, society and polity for the past 250 years. It is important to understand the insertion of Cuba into the global system of commerce. Its entire economy and society had become geared to the production, processing and export of sugar; with the country importing all its needs ranging from foodstuffs, textiles, machinery and other capital goods.

The combination of sugar, slavery and the plantation economy shaped the colonial social structure. The planters’ class had comprised of people born in Spain (peninsulares), although on the eastern part, a small farming class of Cuba born criollos cultivated coffee, tobacco etc.

When wars of independence began in Spanish America, Cuba remained firmly under Spanish rule. The planters were prospering and general population was also contended. Moreover, the planters feared that any movement for independence might lead to slave rebellion, as had happened earlier in Haiti.

The benefits of free trade were felt more strongly during the English occupation of Havana in 1862-63, as new markets were found and the economy was further integrated with the international commercial network. Feeling pressures from both Great Britain and the rising power of an industrialising US, Spain had further liberalised the trading system, which brought new investments and technology to the sugar economy.

In 1868, finally a war for Independence began, led by the independent, small, white farming class of eastern Cuba but it was put down brutally and the remaining non-sugar sector of the economy was devastated. Sugar plantation, as a result, expanded now over the eastern part as well; and new foreign investment and technology poured into the island.

Towards the end of the 19th Century, there was a clear preponderance of foreign owned industrial complexes, which, among others, limited opportunities for local management and participation. A growing world-wide demand for sugar allowed producers to plan with economies of scale in mind, and the industry benefited from new markets, principally in the US.

A growing dependence on the US market for trade, investment, technology, and industrial inputs characterised the US-Cuba relations in the 1880s and 1890s, even while Spain remained, so to say, the colonial country. In 1896, US investments in Cuba were estimated at 50 million US dollars, concentrated in mining and sugar holdings.

Trade between the two countries was valued at $27 million in 1897, and the composition of that trade showed that the US exported to Cuba manufactured and industrial goods and imported sugar, molasses, tobacco, and a few non-manufactured products.

In other words, the island depended totally on the US for export of sugar; and its associated industries like railways, warehouses, port facilities and their financial and labour support structures, all depended directly on the US market.

Thus, the growing penetration of a weak economy dominated by a growing advanced capitalist industrial power shaped a different kind of nationalism in Cuba. Once again, when the forces for independence gathered momentum, this time under Jose Marti, there was a new and a more compelling sense of unity and national purpose.

Jose Marti had forged a more mature vision of political emancipation and nationalism based on self-determination.

He had understood the conservative, anti-democratic character of independence of Latin America where despite seventy years of independence, laws and institutions and practices of colonialism had survived.

In a clear case of a ‘class colour society’, where the White sugar aristocracy dominated the black and mulatto wage labour, Jose Marti and his Cuban Revolutionary Party had offered a programme of decolonisation of Cuba. In this respect, Marti had also foretold of the rise of anti-colonial national movements in Asia and Africa.

Jose Marti became the martyr in the cause of freedom. Cuba lay on the maritime commercial route of the US; and pursuing its ‘manifest destiny’ in the region, the rising power o» US would not allow letting go its control over Cuba. US militarily intervened in 1898, smothered the nationalist movement, ousted the colonial Spain from Cuba and Puerto Rico, and US military remained in control of the island until 1902.

Sugar apart, the strategic importance of Cuba-lying just 80 miles of the coast of Florida-had made the island a subject of domestic political debate too. In the three years of US military occupation, the nation’s infrastructure including finance, administration, and health and education were all built anew, undeniably much to the benefit of the country.

In 1901, the US Congress passed the Piatt Amendment to be included into the Cuban constitution. Cuba became a US protectorate rather than a sovereign nation because the amendment granted territorial concessions to the US, placed financial restrictions on the Cuban government, and allowed US to intervene in Cuba’s internal affairs.

Cuba’s foreign economic relations were also put on a new keel with the Reciprocity Treaty of 1903, which granted preferential treatment to Cuban sugar in the US market and reduced tariffs on US exports to Cuba. US investments in Cuba’s sugar industry, cattle industry, public services, utilities, and other properties had reached US 200 dollars by 1909-nearly 50 per cent of all foreign investment in Cuba.

The Piatt Amendment and the Reciprocity Treaty had established that the country was not only at the centre of global trade in sugar, but also a target of US hegemony in the region. Piatt Amendment was revoked only in 1933. The revolution of 1959 led by Fidel Castro was in a powerful historical continuity the next logical step that radicalised the anticolonial nationalism into socialism.

Coming back to the features of Cuban plantation economy, it had, from an early date, exhibited all the main features of modern capitalist economy. For one, the marketisation of its economy had been early and rapid. Unlike Mexico and the rest of Latin America, the subsistence sector was always very small, and practically all the social classes were integrated into the market economy.

By 1899, over two-third of the rural labour force was engaged in the cultivation of sugar and other cash crops. Secondly, the plantation was a response to the international demand for sugar; and the international decisions to modernise the economy. There had developed a specialised agricultural production system based on intensive exploitation of land and labour, using the latest machinery and milling technology.

Unlike Mexico and in the rest of Latin America, there was no scope for the rise and persistence of the semi-feudal haciendas. Thirdly, given the importance of sugar, foreign capital had very soon ousted the propertied rural middle class and established large-scale production, and corporate and absentee ownership.

American protectorate also had worked to bind more closely the agricultural sector with the high finance: the US bankers had a finger in commerce and manufacturing. Fourthly, the great part of island’s agricultural production was organised along monopolistic lines. Output restrictions, pegged prices, and other forms of monopolistic control had blanketed sugar, tobacco, rice, potato, and coffee farming.

Lastly, in the key sugar sector, mill owners, growers, and wage workers all had powerful organisations. Outputs, wages, prices and the distribution of sugar earnings were determined by the mill owners or growers cartels; or some times by a three-cornered bargaining relationship on the level of national politics.

There were employers’ and producers’ associations in sugar, tobacco and public utilities that exercised monopoly control in their respective fields. As for the labour movement, Cuba had, compared to the size of the labour, one of the largest federations in the world.

The central federation exercised unusual powers over its affiliates ensuring productivity and low wages under the command of a corrupt ‘labour aristocracy’. In short, the economic institutions we are accustomed to associate with the high income capitalist countries overlaid the island’s market system.

It should be stressed that monopoly practices in Cuba’s product and labour markets sprang up in the soil of a market economy. Cuba’s economic institutions were capitalist institutions, historically specific to Cuba and monopolistic in character.

For this reason, they placed limits on the pace of Cuba’s economic development by inhibiting the improvement of agricultural yields, wasting land, barring the wide introduction of a mixed, scientific agriculture, placing ceiling on labour productivity and, in general, on the ability of the economy to mobilise and utilise domestic and foreign capital efficiently.

Guyana was first colonized by Dutch settlers in the 1600s. Spanish explorers had ignored the area because it lacked obvious mineral wealth. Key features of Guyana’s current economic structure, especially the patterns of land use, can be traced to the period of Dutch stewardship.

With Spain occupied with its expansion and riches of Mexico and Peru, Caribbean Sea was an open and inviting target for all other European powers. The English seized Jamaica in 1679 and by early 19th Century, both Guyana and Trinidad & Tobago were also under British colonial rule. Sugar plantations, however in Guyana and Trinidad were not as competitive as those of Cuba or northeastern Brazil.

British sugar colonies evolved as single product economies. With sugar ruling the roost, the society and the colonial administration including slavery was designed to keep the sugar plantations profitable for the White class of absentee planters.

While sugar sweetened the taste buds of Europeans, the demand for European products in the Caribbean also had stimulated the Industrial Revolution. By the middle of 19th Century, sugar produced in the British sugar colonies was facing stiff competition from the cheap sugar produced in Cuba, Brazil and southern US.

Mechanisation of sugar industry in Cuba and Brazil had made sugar from Guyana and Trinidad more expensive. Continuing plantations with African slave labour was no more profitable; one way out of the difficulties was the abolition of slavery.

Instead of modernising the sugar industry and seeking diversification of the economy, the planters’ class resorted to the import of indentured labour from various parts of the world including finally and most importantly from India.

The Indian indentured labour taken to the Caribbean formed part of a larger colonial scheme which involved export of Indian labour to several plantation colonies in the tropics. Between 1834 and 1917, approximately 1,250,000 labourers were sent from India to faraway places in the South Pacific, Africa, and the Caribbean.

Guyana received 238,909 indentured Indians while Trinidad received 143,939. Jamaica imported about 36,412, while St. Lucia, St. Vincent, Grenada, and St. Kitts got about 10,360; and Surinam accounted for 34,304 Indian labourers, and several thousand ended up in the French colonies of Guadeloupe, Martinique and French Guiana.

The West Indies, as a whole, comprising of the British, Dutch and French possessions in the Caribbean together received 519,438 indentured Indians between 1834 and 1917.

The ‘East Indian’ indentured labour was cheap and available in abundance. It was found crucial for the maintenance of an otherwise 1 uncompetitive plantations and their profitability in the age of free trade in sugar.

The indentured labour from India was eminently suitable for work in the tropical climate and was well versed with the sugar culture. Its supply from India was also hassle-free, as British subjects could be moved from one to another British colony under British laws and supervision, without any external hindrance.

As has been noted above, the large plantation economies of Guyana, Jamaica, Trinidad and the Dutch Surinam received most of the Indian indentured labour.

There the plantations were larger in number; many had been abandoned; further lands were available both for settlement and cultivation; and there had existed some potential for agricultural diversification.

Here, the introduction of large indentured Indian labour took place for nearly eight decades until the agitation by the Indian national movement under the leadership of Mahatma Gandhi brought an end to it in 1917.

The system of indentureship was no different from slavery. It was a modified system of slavery, with many of the laws such as the five- year bondage, vagrancy etc., which were in fact the residual laws of slavery system, continued to be enforced. Both economic and non- economic controls were applied to keep the system of indentureship going.

The indentured immigrants were required to sign a contract containing terms and conditions of indentureship before they would leave India. For the period of indentureship, they were not free. They had no choice in their assignment to different estates.

Once on plantations, they could not leave their employers before the expiry of the contract, could not demand higher wages or refuse their assigned works, or live off the plantations. Once the contract expired, they were ‘free’ but had to complete the ‘industrial residence’ or, alternatively, re-indenture themselves. Majority of them had no option but to re-indenture themselves.

Those who would complete the period of ‘industrial residence’ were still not free to seek a return passage. In 1895, a new rule had made those seeking return passage contribute one fourth of the cost of return passage, implying thereby that not many could return.

Those who chose to remain in the colony and work independently were required to pay a special tax. The land policy of the colonial administration also had made it impossible for the Indians who where set free to buy small plots. Only large parcels measuring no less than 100 acres were to be sold at prices, which were beyond the means of the free labour.

The colonial and planters had their interest in maintaining Indian labour under the system of indentureship. The entire system was designed to keep the labour isolated and immobile on the plantations. Indentured Indians were not to leave the plantations without written Passes from the estate managers.

Free Indians were required to carry their ‘certificates of industrial residence’ all the time. They could be challenged and their papers checked by a policeman, an agent of the migration department or owners and staff of an estate through which they were passing. An indentured could be arrested for merely being on the highway without a written permission on charges of vagrancy or unlawful absence.

Anyone who remained absent from work for three days or more would be charged with the serious offence of desertion, and jailed for a maximum period of two months. Other offences inviting imprisonment were willful disobedience in doing the assigned work or performing the work deceptively.

Those who would harbour the deserted immigrants, or deserted indentured, when caught, would be punished even more severely. The system was j designed to essentially keep a large surplus pool of subordinated labour at the disposal of the sugar planters; and towards -this end, both political/administrative and economic measures were adopted.

While such a treatment was meted out to the indentured and freed Indians, more indentured were continuously brought into the colonies. To stay profitable in the global free trade in sugar, plantation economies had to have a continuous supply of low-cost and low-waged labour. In fact, whenever international prices of sugar would fall, more indentured labour would be imported.

This was an ingenuous way to continuously depress the wages ‘ and maintain competition among wage earners for employment.

The economic competition in a context of scarcity of employment, low wages and land tenure system also sowed the seeds of racial and ethnic hostility between the Africans and the Indians. Equally important, the plantation economy shaped the formation of social classes and occupational groups along racial and ethnic lines.

Indentureship had nearly devastated the free villages set up by the emancipated slaves, and had driven the blacks towards towns in a state of pecuniary.

The Indian indentured labour and their descendants remained insular and immobile on the sugar plantations. The indenture-expired free Indians also remained confined to their small agricultural plots and seasonal jobs on the plantations.

Towards the end of the 19th Century, agricultural diversification took place with the rise of cash crops of banana, cocoa etc and the discovery of bauxite and petroleum.

The chasm between the two racial groups widened further as mineral-industrial sector created more opportunities of employment and higher wages than were available in the agricultural sector and also settled the two communities along urban-rural divide.

The policies of colonial administration also clearly favoured the formation of social classes and groups along ethnic lines. Writing about British Guiana, Cheddi Jagan notes that during colonial period, “social hierarchy was built on ‘colour’- the Whiter the colour of the skin, the higher the social status. At the top were White planters; in the middle were the ‘men of colour’-

The Indians, although, ‘brown’ in colour, were not accommodated within the social hierarchy. They were regarded as outcasts, and despised by lie Creole society as ‘coolies’, as being culturally different and economically subservient. They were generally illiterate and stuck to Hinduism and Islam despite the efforts of Christian missionaries to proselytise them.”

In short, the logic and deliberations of the political economy of plantation societies fomented racial divisions and cemented them along the urban-rural and industrial-agricultural divide.

Plantation societies were hierarchical and assigned the lowest position to the Indians, which, in the dominant perception of the Creole society, also corresponded to their low economic status and their menial labour in agriculture.

Plantation societies thus evolved as segmented societies where ethnic and racial divisions were fed upon occupational, residential and economic divisions. In the 20th Century, when trade unions and political parties were formed, they also mirrored the racial and ethnic divisions of these societies.

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