Colonial Economy in Venezuela: 16th-18th Centuries

Production Processes in Colonial Venezuela

The Spanish government stimulated the exploitation of the territory in search of metals. In some cases, it imposed this duty on the conquistadors.

Economic Activities in the 16th Century

• Pearl fishing in Cubagua
• Expeditions in search of gold
• Exploitation of mines in the north of the country

Pearls were exhausted very quickly, and mines did not perform well. Therefore, people dedicated themselves to agriculture and animal husbandry. Thus, an agricultural economy became characteristic of the 18th-century colonial period.

Encomiendas

Encomiendas were the allocation of Indigenous people to settlers to work for free. The political goal was to keep those who were conquering the land for the King. From an economic point of view, it was a means of obtaining enough labor for economic development. Encomiendas began with the founding of the first cities.

Rules of the Encomienda:

• Providing food, clothing, and housing to the Indigenous people.
• The *encomendero* could not administer justice to the Indigenous people in his *encomienda*.
• Protecting the Indigenous people.
• Ensuring their Catholic indoctrination.

Black Labor

Black labor was used mainly for cocoa plantations. Indigenous laborers became increasingly scarce because many died due to the work system, and others fled to the mountains. Enslaving Indigenous people was banned in the mid-16th century. Therefore, African slaves were purchased. The Black slave was the worker *par excellence*, both in number and performance. There were also free Black laborers and small tenants.

Source of free Black people: Free Black people were called freedmen or *libertos*. They had been freed by their masters. Other formerly enslaved people were *cimarrones*, who had fled to the mountains and lived outside the law.

Colonial Exchequer

The colonial exchequer refers to the set of tax revenues that the King received from his colonies. In Venezuela, the Royal Treasury drew mainly from two sources:

• Royalties: All property exclusively owned by the King. The most important were:
  • Lands
  • Forests
  • Pastures
  • Waters
  • Mines
  • Gold, pearls, and precious stones
• Taxes: These encompassed the major source of income for the exchequer. Some were direct income taxes, and others indirectly affected trade and industry.