Did you know New York City was once called New Amsterdam and was part of a Dutch colony known as New Netherland? Did you know this settlement was created by a company that was among the earliest publicly traded stock companies? That company was the Dutch West India Company. Learn more about it, including its role in settlement of New York and other areas in the Americas, in this article.
Dutch West India Company vs. Dutch East India Company
The Dutch West India Company was founded on the model of the Dutch East India Company. The Dutch East India Company was founded in 1602 and modeled after the British East India Company. It had a monopoly on Dutch trade with Asia.
In fact, one of the main reasons for the founding of the Dutch West India Company was opposition to the Dutch East India Company's monopoly. Some merchants argued for the need for another western passage to Asia.
They eventually got their wish, and the Dutch West India Company was founded in 1621. It was, in turn, given its monopoly on Dutch trade in an area that stretched from the coast of West Africa to the Pacific coasts of the Americas. This allowed it to make enormous profits and oversee Dutch settlement in several areas in the Americas.
Fig. 1 - A storehouse used by the Dutch West India Company in Amsterdam.
Dutch West India Company History
After Spain's initial incursions and settlements in the Americas made clear there was vast wealth to be made in the trade of salt, sugar, and tobacco from the so-called New World, the rest of Europe hoped to get in on the action.
The Dutch were no exception. However, they were engaged in a long war against Spain for independence. In 1609, they cut a deal with Spain for a 12-year ceasefire in exchange for a Dutch promise to stay out of trade with the Americas. This treaty delayed the formation of the Dutch West India Company.
Did You Know?
The Habsburgs had inherited the Netherlands, and Charles V, the Holy Roman Emperor and King of Spain, expanded Habsburg's rule. In the 1560s, resistance in the Netherlands began against Spanish rule in what later became known as the Eighty Years War. In 1648, Spain recognized the Netherlands' independence as part of the Peace of Westphalia after the more significant European conflict of the Thirty Years War.
After its founding in 1621, the Dutch West India Company was slow to attract investors. It eventually offered equal standing to foreign investors as citizens of the Netherlands, one of the first companies to do so. By 1623, it had raised enough money to have 15 ships and begin seriously exploring the West African and Brazilian coasts for trade opportunities.
With the 12-year truce over, the Dutch West India Company also engaged with Spanish and Portuguese ships. The Dutch imagined a grand plan where they could seize control of much of the colonies and trade between West Africa and the Americas, although it never had much success in doing so. Instead, it eventually focused on targeting Spanish and Portuguese trade through privateering.
Privateering
Privateering was a common practice by European empires in the 15th to early 19th centuries. The government gave civilian ships licenses to carry out attacks on foreign ships in exchange for sharing some profits. In a nutshell, it was a semi-legal form of piracy and a way for European powers to fight each other indirectly.
At first, the company failed to have much success. Privateering did result in some profit, but the company knew it was unlikely to be a long-term winner, and it turned to establish more permanent settlements.
Dutch West India Company Colony and Colonies
At first, they targeted Portuguese Brazil again, hoping to take control of the lucrative trade there. However, after failing to hold outposts taken in successful raids in 1630, it turned its attention elsewhere.
Among the colonial settlements the company created were:
- The Netherlands Antilles, or Dutch Caribbean, is a group of islands that includes Aruba and Curacao.
- Suriname is on the northern Caribbean coast of South America.
- Guyana, also on the northern coast of South America and taken over by the British after 1796.
- Trading posts on the Gold Coast in present-day Ghana.
- Tradings posts on the Slave Coast in present-day Benin.
- New Netherland on the east coast of North America, around present-day New England in the United States.
Dutch West India Company and New Amsterdam
The colony was known as New Netherland, which included parts of the present-day US states of New York, Connecticut, Delaware, and New Jersey. The colony primarily engaged in the fur trade.
It increased in the 1650s, and its capital New Amsterdam became an important trade port. This settlement began as a small fort and trade outpost and was located on the southern tip of Manhattan Island.
By 1664, the Dutch West India Company's New Amsterdam population had grown to 2,500. However, in that year, the British, at war with the Dutch, conquered the area. They renamed it, New York after the Duke of York, and the site of New Amsterdam eventually became the downtown Manhattan we know today.
Fig. 2 - Painting of New Amsterdam in 1664, the year it was conquered by Britain and had its name changed to New York.
Dutch West India Company's Decline, Recreation, and Dissolution
After the end of the conflict with Spain in 1648, the company was barred from attacking Spanish ships. It failed to produce much profit. However, in this period, it increasingly became involved in the slave trade through its outposts in West Africa. This kept it afloat until 1674, when it was dissolved after being unable to pay its debts.
However, the same year, a new company called the New West India Company was founded. This new Dutch West India Company essentially replaced the first, acquiring control of all of its forts, settlements, and areas of trade. The company continued to be heavily involved in the slave trade and maintained the remaining colonies in the Caribbean for the next 100 years.
However, much like its counterpart, the Dutch East India Company, it was clear after the Forth Anglo-Dutch War from 1780 to 1784 that the company could not maintain control of these areas. In 1791, the government of the Netherlands bought all shares of the company. On January 1, 1792, all areas under the company's control became formal colonies under the direct administration of the Netherlands' government.
Fig 3 - Naval battle during the Fourth Anglo-Dutch War.
Dutch West India Company Significance
The Dutch West India Company never proved nearly as profitable and essential for international trade in the Americas as its counterpart in the East Indies. However, it established some colonies, including the founding of New York, and it played a significant role in the slave trade.
Dutch West India Company and Slavery
The Dutch West India Company's slavery participation was also exceptionally high. The Dutch had established a trading post and fort on the West African coast in present-day Ghana as early as 1612. They founded ten outposts in Africa, all involved in the slave trade.
They received asientos to trade slaves to Spanish colonies and transported slaves to Portuguese Brazil and its colonies, including New Amsterdam. Surname and Guyana both had prominent slave markets during the 18th century. Historians estimate around 600,000 Africans were enslaved and forced across the Atlantic by the Dutch from 1612 to 1872, making up around 5% of the total Atlantic slave trade.
Asiento
The asiento was a special privilege given by Spain to foreign merchants to exclusively trade slaves with its colonies and circumvent the regular Spanish monopoly on trade.
The Netherlands was one of the last countries in the world to abolish slavery. Abolition was actually passed in 1848 but was not implemented until 1863, and even then, there was a 10-year transition period, meaning slaves in Dutch colonies were not fully accessible until 1873.
Fig. 4 - Enslaved people on a plantation.
Dutch West India Company Worth
As noted above, the Dutch West India Company was never as profitable or valuable as the Dutch East India Company. Therefore, historians have difficulty determining the Dutch West India Company's worth.
At its founding, it had a capital investment of just over 7 million guilders. It did have moments of success, such as the capture of a Spanish treasure fleet in 1628. However, over the long term, it failed to produce enough profit, evidenced by its dissolution in 1674. While after its re-establishment, it had more success, the conflicts with Britain proved too costly for it to handle on its own.
Dutch West India Company - Key takeaways
- The Dutch West India Company was founded in 1621.
- It was given control of Dutch trade in West Africa and the Americas.
- It tried but failed to take over Portuguese Brazil, establishing several colonies, including New Amsterdam, which later became New York City.
- It was heavily involved in the Atlantic slave trade from its outposts in West Africa.
- It was dissolved in 1674 due to a lack of profitability but revived and operated until 1791 when the government of the Netherlands officially took over its colonial holdings.
Explanations 
Textbooks 
Exams 
Magazine 
