Section 2 Imperial Consolidation and Liberal Rule c1890-1914 Chapter 9 Trade and Commerce
Chapter 9: Trade and Commerce
Did the Empire Make Britain Wealthy?
• In 1890 there was a general assumption that the Empire made Britain wealthy
• The cost of Empire was something that Gladstone’s Liberals had been concerned about and there were some
radical critics who continues to argue that perhaps the Empire was not as beneficial as most people believed
• By 1914, a few more people began to question whether the cost of Empire were entirely justified
Evidence of Benefit
• Britain did have a lot of trade with Empire, the relationship between export and import prices moved about
10% in Britain’s favour between 1870-1914. As the Empire grew British exports to the Empire increased from
21.2% in 1871-75 to 37.2% in 1913. India alone took 20% of Britain’s total exports, worth £150 million to
business by 1914
• Britain was a predominantly industrial society so it expected the colonies to supply food for a population
which was outgrowing the capacity of domestic agriculture. They imported vast quantities of wheat and beef
from Canada, lamb and dairy products from New Zealand and the Empire was the main foreign source of
cheese, apples and potatoes. This trading supply was considered safe and stable
• Britain’s manufacturing industries sourced raw materials from Empire e.g. cotton, wool, timber, cocoa, tea
and palm oil which supported home industries and meant that manufactured goods could be sold on for profit.
The Empire also allowed Britain to prevent/control colonial industries and therefore reduce competition
• Transport companies gained because ocean steamships were the main carriers of goods and people across the
empire. Orders from British shipbuilders expanded and railway companies gained huge profits from the
growth of Empire e.g. the Ugandan Railway which was used to consolidate the expansion in East Africa, it
was 660 miles long and cost £5 million and the maintenance of Empire as the railways in India continued to
expand
• British breweries also gained from colonial trade and some beers were specially developed for colonial
conditions e.g. India Pale Ale. Such companies included Bass and Allsopp of Burton on Trent, Shepherd
Neame of Kent and John Smith’s Tadcaster brewery
• 40% of British investment overseas took place in the Empire because such investments were considered safe.
By 1914 Britain had invested twice the amount of the French and 3 times that of Germany overseas. This
invisible trade grew rapidly until 1914
• Colonial governments automatically bought imports (including expensive railway equipment) from Britain
because it was simpler and because they felt it was their duty. The use of a common language and the fixed
exchange rates to the sterling facilitated trade with Britain and its colonies because it was simpler
• Many parts of the Empire e.g. the White Dominions and India were self-financing, being run by taxation
Evidence against Benefit
• The Empire was not the main source of Britain’s trade, only 24.9% of British imports came from the colonies
and 37.2% of exports went to the colonies by 1913. Trade with the Empire was remaining static but other
trade was growing and manufacturing exports, in particular, grew much more slowly after 1870
• The foodstuffs that Britain needed mostly came from non-colonial countries e.g. Britain imported 17.2 million
hundredweight per year of wheat from Russia and 30.7 million (which was almost 10 times that of Canada)
from the USA. Furthermore, cheap colonial food helped to reduce the profitability of British farm produce
• Some of the growth of the Empire in this period was expensive to secure but offered little return in terms of
trade e.g. the whole of Tropical Africa only amounted to 1.2% of British trade and The Boer War on 1899-
1902 cost Britain a huge £250 million, some believed mine owners had tricked Britain into fighting the Boers
to preserve their own profits
• Within Britain, the middle classes were facing an increased tax burden, partly because of the maintenance and
defence of the empire. Some argued that is the middle classes had less tax to pay, then they would’ve
modernised their equipment better and perhaps paid their workers more
• The availability of cheap imperial products prevented the British from developing its scientific enterprises
which proved damaging, in the long run, e.g. while the French, Russians and Germans developed synthetic
alternatives to rubber, Britain simply relied on its supplies from Africa and Asia
• British investment overseas was expanding in non-colonial areas as well e.g. in the USA. This was considered
riskier but could be much more profitable
Chapter 9: Trade and Commerce
Did the Empire Make Britain Wealthy?
• In 1890 there was a general assumption that the Empire made Britain wealthy
• The cost of Empire was something that Gladstone’s Liberals had been concerned about and there were some
radical critics who continues to argue that perhaps the Empire was not as beneficial as most people believed
• By 1914, a few more people began to question whether the cost of Empire were entirely justified
Evidence of Benefit
• Britain did have a lot of trade with Empire, the relationship between export and import prices moved about
10% in Britain’s favour between 1870-1914. As the Empire grew British exports to the Empire increased from
21.2% in 1871-75 to 37.2% in 1913. India alone took 20% of Britain’s total exports, worth £150 million to
business by 1914
• Britain was a predominantly industrial society so it expected the colonies to supply food for a population
which was outgrowing the capacity of domestic agriculture. They imported vast quantities of wheat and beef
from Canada, lamb and dairy products from New Zealand and the Empire was the main foreign source of
cheese, apples and potatoes. This trading supply was considered safe and stable
• Britain’s manufacturing industries sourced raw materials from Empire e.g. cotton, wool, timber, cocoa, tea
and palm oil which supported home industries and meant that manufactured goods could be sold on for profit.
The Empire also allowed Britain to prevent/control colonial industries and therefore reduce competition
• Transport companies gained because ocean steamships were the main carriers of goods and people across the
empire. Orders from British shipbuilders expanded and railway companies gained huge profits from the
growth of Empire e.g. the Ugandan Railway which was used to consolidate the expansion in East Africa, it
was 660 miles long and cost £5 million and the maintenance of Empire as the railways in India continued to
expand
• British breweries also gained from colonial trade and some beers were specially developed for colonial
conditions e.g. India Pale Ale. Such companies included Bass and Allsopp of Burton on Trent, Shepherd
Neame of Kent and John Smith’s Tadcaster brewery
• 40% of British investment overseas took place in the Empire because such investments were considered safe.
By 1914 Britain had invested twice the amount of the French and 3 times that of Germany overseas. This
invisible trade grew rapidly until 1914
• Colonial governments automatically bought imports (including expensive railway equipment) from Britain
because it was simpler and because they felt it was their duty. The use of a common language and the fixed
exchange rates to the sterling facilitated trade with Britain and its colonies because it was simpler
• Many parts of the Empire e.g. the White Dominions and India were self-financing, being run by taxation
Evidence against Benefit
• The Empire was not the main source of Britain’s trade, only 24.9% of British imports came from the colonies
and 37.2% of exports went to the colonies by 1913. Trade with the Empire was remaining static but other
trade was growing and manufacturing exports, in particular, grew much more slowly after 1870
• The foodstuffs that Britain needed mostly came from non-colonial countries e.g. Britain imported 17.2 million
hundredweight per year of wheat from Russia and 30.7 million (which was almost 10 times that of Canada)
from the USA. Furthermore, cheap colonial food helped to reduce the profitability of British farm produce
• Some of the growth of the Empire in this period was expensive to secure but offered little return in terms of
trade e.g. the whole of Tropical Africa only amounted to 1.2% of British trade and The Boer War on 1899-
1902 cost Britain a huge £250 million, some believed mine owners had tricked Britain into fighting the Boers
to preserve their own profits
• Within Britain, the middle classes were facing an increased tax burden, partly because of the maintenance and
defence of the empire. Some argued that is the middle classes had less tax to pay, then they would’ve
modernised their equipment better and perhaps paid their workers more
• The availability of cheap imperial products prevented the British from developing its scientific enterprises
which proved damaging, in the long run, e.g. while the French, Russians and Germans developed synthetic
alternatives to rubber, Britain simply relied on its supplies from Africa and Asia
• British investment overseas was expanding in non-colonial areas as well e.g. in the USA. This was considered
riskier but could be much more profitable
