Decline of the sugar industry

An often held view is that the economy of the British Virgin Islands deteriorated considerably after the abolition of slavery. Whilst this is, strictly speaking, true, it also disguises the fact that the decline had several different causes. In 1834 the Territory was an agricultural economy with two main crops: sugar and cotton. Of the two, sugar was the considerably more lucrative export.

Shortly after the abolition of slavery the Territory was rocked by a series of hurricanes. At the time, there was no accurate method of forecasting hurricanes, and their effect was devastating. A particularly devastating hurricane struck in 1837, which was reported to have completed destroyed 17 of the Territory's sugar works. Further hurricanes hit in 1842 and 1852. Two more struck in 1867^[21] and 1871. The island also suffered severe drought between 1837^[22] and 1847, which made sugar plantation almost impossible to sustain.

To compound these miseries, in 1846 the United Kingdom passed the Sugar Duties Act 1846 to equalise duties on sugar grown in the colonies. Removing market distortions had the net effect of making prices fall, a further blow to plantations in the British Virgin Islands.

In 1846, the commercial and trading firm of Reid, Irving & Co. collapsed. The firm had 10 sugar estates in the British Virgin Islands and employed 1,150 people. But the actual economic effect of its failure was much wider; the company also acted as a de facto bank in the Territory, allowing advances to be drawn on the company as credit. Further, the company had represented the only remaining direct line of communication to the United Kingdom; after its collapse mail had to be sent via St. Thomas and Copenhagen.

By 1848, Edward Hay Drummond Hay, the President of the British Virgin Islands, reported that: "there are now no properties in the Virgin Islands whose holders are not embarrassed for want of capital or credit sufficient to enable them to carry on the simplest method of cultivation effectively."

In December 1853 there was a disastrous outbreak of cholera in the Territory, which killed nearly 15% of the population.^[23] This was followed by an outbreak of smallpox in Tortola and Jost Van Dyke

Up until 1845, the value of sugar exported from the Territory varied, but averaged around £10,000 per annum over the preceding ten years. With the exception of 1847 (an unusually good year), the average for the subsequent 10 years was under £3,000. By 1852, it had fallen below £1,000 and would never recover.

Although this was terrible news for the islands as a whole, as Isaac Dookhan has pointed out,^[24] this did mean that the value of land plummeted sharply, and enabled the newly free black community to purchase land where otherwise it might not have been able to do so. It also created the basis for the future peasant agricultural economy of the British Virgin Islands.

Date: 2015-01-29; view: 745