Chapter III
The Netherlands Empire

I. The Netherlands East Indies

UNQUESTIONABLY, THE DUTCH PEOPLE have made of the Netherlands East Indies what they are. In other hands they might have become as a slice of China--a dense agricultural population consisting of smallholders, neglected in mind and body by the paramount government, and subjected to brigandage and plunder, or allowed to degenerate, racked in anarchy. How different is the story of Dutch achievement in their island empire. The wisdom of the Netherlands Government, when the first round was lost in Europe, to remove the seat of government to London, so that they might thereby carry on their task of opposing the enemy with all the material resources of the Netherlands' overseas possessions, is self-evident.

The total area over which the Dutch rule in the East Indies is 735,000 square miles. The estimated population of the territories in 1940 was 70,467,000--a figure which exceeds the combined populations of all the British Crown colonies and


other territories administered by the Colonial Office. The islands of Java and Madura are the most densely populated in the Dutch Eastern possessions, 818 per square mile. A silent tribute to Dutch administration may be found in the growth of the population which has increased in twenty years from 52,327,000 to its present figure.

In view of distorted statements which are made occasionally in interested quarters, it is worthy of notice that the Dutch have been in the East Indies for 340 years. They are not newcomers. The African ' scramble for territory ' argument does not hold in this case. The Dutch East India Company had as long and honourable an existence as our own East India Company which operated from Leadenhall Street. All original intentions in the East Indies were based on the faber est quisque fortunae suae theory. In their early days both the Dutch and British companies were attracted by thoughts of financial returns rather than any higher motives. The first successful attempt to reach the East Indies was made by four ships of Holland, which sailed from the Texel on April 2nd, 1595. This voyage was financed by Amsterdam merchants who raised a capital of almost 300,000 guilders. Following this and other voyages the United Netherlands Chartered East India Company was formed on March 20th, 1602, as an amalgamation


of several smaller companies. The States-General granted the charter in the first instance for an initial period of twenty-one years and the company was given substituary sovereign rights in all the territories situated east of the Cape of Good Hope and west of the Straits of Magellan. The total stock issued amounted to some 6,500,000 guilders. Thus were the foundations of Dutch Empire laid in the East Indies.

With a brief interregnum during the Napoleonic wars when the Dutch possessions were under British rule, the East Indies have been Dutch ever since those early days. The capital city of the Dutch Empire in the East Indies, Batavia, named after the original Batavian tribe in Holland, was founded by Governor-General Coen as far back as 1619. To-day it is one of the finest cities in the Far East and has a population of some 540,000. The Netherlands East Indies, as an integral part of the Kingdom of the Netherlands, are Dutch by every natural right--right of discovery, right of settlement, right of development. They are inalienably part of the Kingdom of the Netherlands in accordance with the laws of the Netherlands whose sovereignty in the East Indies is absolute and is recognized as such by all other Powers.

The unity of the East Indies and the motherland has been demonstrated of recent years in countless


different ways, but never has the devotion and attachment of the East Indies people to the historic House of Orange-Nassau and to the motherland been Ģis firm and unshakable as during the past twelve months of travail. From men and women of every race and class have come words of sympathy and material aid. Even the leaders of the Nationalist Movement (for the East Indies are not behind British India in this respect) have spoken moving words of tribute and sympathy. Recently, one of the foremost leaders of the Nationalist Movement, Hadji Agoes Salem, spoke the following words:

As an Indonesian I feel this war to be a war of our people in which the future of their development is at stake, a war in which I wish to participate wholeheartedly and with all my strength. There have been periods in the past century when the dangers of war have threatened your frontiers, but always the will of your people to maintain peace, your moral outlook, your clear good sense, your practical desire to safeguard your country against the calamity of war has enabled you to achieve great prosperity.... More, in my view, than your accomplishments in the field of knowledge and science, your town planning and road-building, is the development of your democratic and social institutions, the growth of your democratic thought and the democratic spirit of your people. This has come to pass and has grown from the inner spirit, in harmony with your own character and your own nature, in conformity with the needs of your progressive development.... We Indonesians may consider ourselves fortunate that,


owing to the evil crime of the enemy, the Kingdom of the Netherlands has joined the right side in the struggle. We cannot praise sufficiently the courage and wisdom of H.M. Queen Wilhelmina in taking the right decision at the right moment, and for having withdrawn from the power of the enemy together with her government, so that the struggle can be continued from other parts of the kingdom in the east and west.... The great mass of the people of the East Indies do not wish for any change, which means, interference by foreign powers. The intelligent--the educated--people know that this war into which Holland has been drawn at the side of England and the other Allies, is a war against the enemies of democracy, against those who have made it clear that their object is racial overlordship and the destruction of democracy.

Men of Dutch blood the whole world over must have been touched by this generous acknowledgment. But it is all so true. For decades past the guiding motive of Dutch rule has been the social and economic betterment of the people of the East Indies. The labours of earlier years--building magnificent roads and railways, linking up the various islands of the Archipelago by regular and excellent steamship services, maintaining a proper balance between imports and exports, levying light taxation from the native-born population and providing all those services expected of the modern State, such as sound and scrupulous justice--have been much intensified and have covered a wider


field during the past half-century. More and more native-born inhabitants of the East Indies have attended the ancient Dutch universities and have returned to the East with that fullness of educational attainments which perhaps can only be acquired in the Netherlands, one of the foremost centres of learning. Old laws which, while considered adequate by an earlier generation, had become onerous and outmoded, have been abrogated.

Particular attention has been given to local education. Tropical agricultural education in particular possibly is nowhere as good as in the Netherlands East Indies. The Dutch have carried their knowledge of the soil with them to the East and while they have found a natural fertility there, the ability with which they have applied their natural talents has caused two blades of grass to grow where only one grew before.

The peoples of the East Indies are in the main a gentle, rural population. They ask for little except to be allowed to go about their toil in peace, to be able to keep to the customs of their forefathers and to experience life as not too heavy a burden. The Netherlands authorities are especially jealous of these simple requirements of the native population. The Labour Inspectorate and the Courts of Justice are ever alive to this and are even, to those who have a false idea of the relative status of European


and Indonesian, astonishingly severe if natives are harmed in any way which is in conflict with the law. It is not surprising, in the circumstances, that the population is growing at a rapid rate. The death-rate of 18.4 per 1,000 among the native population compares with a birth-rate of 27.4 per 1,000, thus showing an increase of 9 per 1,000. The death-rate has varied from 16.5 to 18.8 per 1,000 in recent years and the birth-rate has moved between the extremes of 26 to 28.1 per 1,000. It is, of course, always difficult to carry a European medical service into the homes of a dense tropical native population. Yet the Dutch have made tremendous strides in this direction, mainly by throwing open the doors of their medical schools to native-born students. There are more than 320 hospitals and similar institutions.

In the field of education the Netherlands authorities, as already mentioned, have been especially active. There are 19,000 elementary schools for natives and almost 700 agricultural, trade and industrial schools. There are three institutions of university standing and sundry other educational establishments.

All the foregoing are achievements of which Hollanders are justly proud. They may well be. But alongside these sociological achievements there are others which have made their effect felt


throughout the world. To some the term 'Netherlands East Indies' conveys the idea of a few insular specks in Far Eastern seas; others have some vague notion that rubber is grown there, and still others picture the strangest things based on superficial travel books, bad fiction and worse films. Very few realize the full extent to which wise and efficient Dutch policy has enabled large areas in the Dutch Eastern possessions to yield the fruits of the earth in such abundance that other nations look on enviously, and indeed--even if not openly--covet that in which they never can have a share.

It has been said already that the Dutch have carried their skill in agriculture across the seas to that Holland which lies to the south of the Malay Peninsula. But not only have they carried their skill in agriculture. Their financial ability to succeed wherein so many others fail likewise crossed the oceans with them. They always have been able to make tropical agriculture pay. This, be it added, has not been at the expense of the native worker, though admittedly his wages cannot be judged by European standards.

The Dutch people have succeeded in making of their Eastern possessions as well ordered a tropical territory as may be found in the whole world, for while in their general sociological outlook the Dutch are liberal in their tendency, in economic and


financial matters they are the essence of care and caution, so that they have never wasted their substance. For at least a quarter of a century, with the exception of the year 1922, the foreign trade balance of the East Indies has always been favourable, varying from 112,000,000 to 1,374,200,000 guilders. In 1938 exports were valued at 714,400,000 and imports at 497,400,000 guilders, the favourable trade balance thus amounting to 217,000,000 guilders, or expressed in sterling at the then current rate of exchange: imports, £55,266,666; exports, £79,380,000.; balance, £24,111,000.

It is sheer competence which has yielded such satisfactory results, competence in administration, in finance, in the practice of tropical agriculture, of which the last mentioned is as important as any. The Dutch, guided by wise tropical agricultural authorities, have spread their risks. They have not placed all their eggs in one basket. As a result the Netherlands East Indies produce 90 per cent, of the world's cinchona, from which quinine is extracted; 70 per cent, of the world's kapok; 79 per cent, of the world's pepper; and 38 per cent, of the world's rubber. The figure for copra is 30 per cent., that for tea 17 per cent., for oil palm products 20 per cent, and sugar 5 per cent. With the exception of pepper and copra, each one of these products is the direct outcome of the


enterprise of the Dutch suzerain power, and of Dutch agricultural development.1

Apart from these commodities, the territories produce petroleum, rice, bauxite, coffee, tobacco, nutmegs, mace and cloves (the three latter small items now, but the cause of embittered rivalry in the seventeenth century), groundnuts and gold. Even this list is not exhaustive. But it is illustrative of what has been done to develop the island empire. Much of this agricultural and other development has been stimulated by the City of London. A large sum of British capital is invested in the Netherlands East Indies, notably in the tea and rubber-growing industries. But these interests, comparatively speaking, are newcomers to the field, compared with old-established British firms who have carried on business in Java for generations--firms whose name is held in the highest respect from Atjeh to the Arafura Sea and beyond, and who, in the day before beet-sugar, made the growing of cane-sugar their particular interest. And yet, notwithstanding the considerable British interests in the Netherlands East Indies, there were far fewer than 2,000 male European-born British subjects resident there before the


present war, though there were more than twice that number of Germans. Which goes to show the closeness of collaboration between British commercial undertakings and those Dutch people who are entrusted with the care of their interests.

In normal times more British ships call at Netherlands East Indies ports than those which fly the Dutch flag. The number of ships which flew the British flag and which entered Netherlands East Indies ports in 1939 was 6,505, while the comparative figure for Dutch ships was only 3,420. So that Great Britain may be grateful to the Netherlands authorities for maintaining the generous policy of the open door. The only field which the Netherlands authorities reserve for their own nationals is the coastal trade. In every other way, there is little differentiation between Europeans, whatever their nationality. All are equal in the eyes of the law; all may avail themselves of the same advantages of living under Dutch rule which Dutch subjects themselves enjoy, save alone the simple prerequisite that they are domiciled in the territories. They may own land on Government lease or they may be granted concessions; they may till and harvest, buy and sell, mine and own realty and personalty without fear of discrimination or interference in their enjoyment of these.

The Government of the Netherlands East Indies


is vested in a Governor-General who derives his authority from the Queen, is responsible to the Minister for the Colonies, and accounts for his actions, within limits laid down by the Constitution and law, to a People's Council of sixty, of whom thirty are native-born, five are other Orientals and twenty-five are Europeans. Of these, twenty-two are nominated and the remainder elected by a limited electorate, since clearly the day has not yet arrived for the grant of universal franchise throughout the East Indies. That day may come, but Dutch rule is so tolerant that the present need for a large elected legislature is not apparent.

Immediately after the Netherlands East Indies declared themselves to be at war with Germany, steps were taken to bring about a great increase in the means of defence. Conscription was introduced for all male Dutch subjects between the ages of 18 and 46. At the same time all potentially dangerous German nationals, totalling approximately 5,000, were interned in accordance with the normal rules of war. The expenditure on defence was greatly increased and in the budget for the year 1941 £55,500,000 has been set aside for defence. This compares with £40,000,000 in 1940, and accounts for 67 per cent, of the total budget of £83,000,000. The vote is being spent on the purchase of armaments of all sorts, aeroplanes,


tanks and other mechanized vehicles and ammunition. The Netherlands East Indian Army is being mechanized rapidly in order to increase its mobility in accordance with the requirements of modern warfare. It is a powerful force, composed in a large measure of regulars.

There is a growing popular demand on the part of the native-born population for a further measure of conscription to include the natives as well as the Dutchmen in the Netherlands East Indies. In other ways, too, the native-born population has given striking proof of its solidarity in the present emergency. In connection with the foregoing it may be pointed out that the authorities have already provided several opportunities for the natives to play a part in the defence of the country. The new officers' training schools which have been started in the Indies since the invasion of the Netherlands have been thrown open to natives. The same applies to the Naval Colleges. In the Air Force, too, a number of natives are receiving training as pilots, gunners and observers. No less than 20 per cent, of the natives who have been accepted for training qualify as pilots, and prove to be as competent as their European-born compatriots.

A most important arm of Netherlands East Indies defence is the Navy. Even in peace-time the greater part of the Royal Netherlands Navy


was based on the Netherlands East Indies, where, for the most part, it still remains. The navy consists of various units, from cruisers to submarines and small patrolling craft. Ships of a light type are being built in the East Indies to be added to the present naval strength, and in other ways the naval forces are being continually augmented. Facilities for repair work in the Indies are fully adequate.

Immediately after the invasion of the Netherlands steps were taken in the Indies to form Local Defence Corps on the model of the Home Guard. In these bodies natives and Chinese participate actively. A system of compulsory national service which extends to the native population as well as to Europeans has enabled A.R.P. and similar services to be systematically organized. Trial blackouts are enforced from time to time.

In the economic field the transition from peace to war naturally has brought about great changes. Exchange control has been introduced and a fixed rate established between the Dutch East Indies guilder and the pound sterling, so that to all intents and purposes the Netherlands East Indies are now a part of the sterling area. The Dutch guilder is no longer quoted or accepted in the East Indies.

The continued functioning of the large number of companies in the East Indies which in


peacetime were controlled from the Netherlands, has been made possible by the transfer of the companies' registered offices from the Netherlands to the East Indies. In the period from the 15th of May to 25th of September 462 such transfers were effected.

As a result of the closing of European markets to Netherlands East Indies producers, arrangements had to be made for the disposal of their output of raw materials. European markets took 30 per cent, of the Netherlands East Indies peace-time exports--90 per cent, of the tobacco, 17 per cent. of the oil and 22 per cent, of the rubber produced. This stream of supplies to Europe has now been completely stopped and diverted to Allied countries and the United States.

The mercantile marine is also rendering great services to the Allied cause, both of an economic and a military nature. In passing, it may be mentioned that nineteen German ships which were seized by the Dutch East Indian authorities on May 10th, 1940 are now being used for Allied war purposes.

The internal economy of the Netherlands East Indies is such that there is no need for rationing of any sort. The archipelago is almost completely self-supporting.

The outbreak of war has not been allowed to interfere with the welfare policy for the native


population. The budget for 1941 provides for an increase in the sums spent on native education. Another example of this continued care for the native population may be found in the fact that controlled emigration from the over-populated island of Java to the islands of Sumatra and Celebes is proceeding unchecked. In 1940 16,000 families were transferred from Java to the other islands as compared with 14,000 in the preceding year.

II. Suriname

The fact that those territories of the Kingdom of the Netherlands which are situated in the Western hemisphere are not in the news does not make them any the less important in their relation to the mother country. The attachment of Suriname, (Dutch Guiana) and Curaçao to the Netherlands dates back to the seventeenth century. Suriname became Dutch territory in 1667 on conclusion of the Peace of Breda when the Netherlands 'exchanged ' New Amsterdam, the New York of a later day, for 'plantation' territory in South America. During the eighteenth century the colony enjoyed a considerable measure of prosperity and produced cocoa, sugar and coffee. It was directed by a body known as the Chartered Society of Suriname, in which the Netherlands West Indies Company


held one-third of the shares and the City of Amsterdam two-thirds. During the Napoleonic wars Great Britain took over the administration, as was the case in the East Indies. The prosperity of Suriname was dealt two shattering blows in the nineteenth century--the first of these being the abolition of slavery in 1863; the second the opening of the Suez Canal. The abolition of slavery brought about an acute labour shortage, whereas the opening of the Suez Canal gave European countries quicker access to the East Indies with their bountiful reservoir of cheap labour and far greater productiveness. Suriname could not compete against conditions such as these. In succession Chinese, British Indian and Javanese labourers were introduced into the colony, but in the end this did not contribute towards a revival, although a number of coffee and sugar estates have continued operations due in part to considerable financial assistance given by the Netherlands Treasury. At least one-half of the population is now Asiatic in origin. The Chinese and some British Indians have become shopkeepers and merchants, but the Javanese and Indians, for the most part, indulge in agricultural pursuits. Chinese and Indians are no longer recruited, but Javanese settlers, who receive financial assistance from the Government, are encouraged to develop their own small holdings. These settlers, as well as


the original immigrants, have changed the face of the colony.2 Small agricultural holdings are now the backbone of support of the colony. The production of rice, as a result, is commencing to occupy an important position in the country's economy. A first-class agricultural experimental station has been established at the capital, Paramaribo. Apart from rice, there are hopes that bananas and citrus fruits will become products of importance.

Among Suriname's mineral wealth the most important item is bauxite, which is mined by Americans and provides half of the U.S.A.'s requirements of aluminium. Gold is also found. British and Dutch concerns are interested in gold-mining.

The unsatisfactory economic conditions pertaining in the colony have resulted, for many years past, in an annual budget deficit. Conditions are not very different in this respect from those in neighbouring British colonies. During the past ten years the Netherlands Treasury has had to contribute some 3,000,000 guilders per annum on a budget of between six and seven million guilders. In all, the Netherlands Treasury has paid out no less than


100,000,000 guilders towards the support of Suriname.

The territory enjoys a considerable measure of autonomy. As far back as the 1680's Suriname had a representative governing body. Even as are the East Indies, Suriname is one of the four constituent parts of the Kingdom of the Netherlands, i.e. (a) the Netherlands, (b) the Netherlands East Indies, (c) Suriname and (d) Curaçao. This is prescribed by an amendment to the Constitution of the Netherlands of 1922. Government is in the hands of a Governor assisted by a Legislative Council which consists of the Governor, a Vice-Chairman and three members, all appointed by the Sovereign. The representative body consists of fifteen members, of whom ten are elected by Suriname electors and five are nominated by the Governor.

The same care which the Netherlands authorities devote to the cultural and physical needs of the people of the East Indies is given to the people of Suriname. The birth-rate has averaged 30 per 1,000 during the past five years, compared with a death-rate of 12 per 1,000, which is not unsatisfactory for a tropical area. Fully one-third of the budget expenditure is earmarked for education and health purposes. Education has been compulsory for sixty years or more. Paramaribo has a fully staffed medical school.


The war has further upset the economy of Suriname. Coffee which formerly was exported to Norway is now practically unmarketable, while sugar which was shipped to Holland is being shipped to Great Britain at unprofitable prices.

III. Curaçao

Curaçao, the third of the Netherlands territories overseas, consists of six islands in the Caribbean Sea, which had a population of 101,121 on December 31st, 1938, of whom 30,453 were resident in the capital, Willemstad. Curaçao has been a Netherlands possession since 1634, when it was captured from the Spaniards. Even as were the East Indies and Suriname, the territory was in British hands during the Napoleonic wars. Curaçao was administered by the Netherlands West Indian Company until that body was dissolved in 1791. The island knew periods of great prosperity in the eighteenth century. One of the islands, St. Eustace, was captured by Admiral Rodney in 1781, and, as an indication of the trade then conducted, the value of his booty was estimated at 34,000,000 guilders in merchandise and 200 ships.

The only two islands of any importance nowadays are Curaçao and Aruba, where two of the world's largest petroleum refineries are situated.


The great prosperity which Curaçao now enjoys dates back to the opening of the Panama Canal and the establishment of the refineries, first in Curaçao by the Curagao Petroleum Industry Company, a subsidiary of the Royal Dutch group, and a few years later at Aruba by the Lago Oil and Transport Company, a subsidiary of the Standard Oil Company of New Jersey. In both these refineries the greater part of the petroleum produced in Venezuela and Columbia is handled. Curagao is fortunate in possessing splendid port facilities where not only tankers can berth, but transatlantic liners can coal and tranship cargo. The very largest ships can be accommodated. The total amount of shipping entered and cleared before the war actually exceeded that of the port of London.

Curagao and Aruba separately handled tonnage before the war approximately that of Southampton. The value of petroleum exports was 333,000,000 guilders.

There are few domestic products, principally phosphates, aloes and straw hats, but the trade is not large.

The revenues have shown a steady increase and a regular annual surplus, which is applied, inter alia, to creating a pension fund and for defence expenditure. As in all Dutch territories, much attention is given to education and health. The climate is


healthy and the number of births in 1938 was 32 per 1,000 against a comparative mortality figure of 10 per 1,000.

Government is entrusted to a Governor, a Legislative Council and a representative body as is the case in Suriname.

The war has not affected the economy of Curaçao in view of the great demand for petroleum products. A number of German ships in port on the outbreak of war between Germany and the Netherlands were seized and placed at the disposal of the Allies.

This then is the story of the Netherlands Empire. A great Empire in truth. Its supreme government is now conducted from London, where Mr. Ch. Welter, the Minister for the Colonies, assisted by a team of experienced officials, all of whom have spent many years in one or other of the overseas territories, directs affairs. The manner in which this is done is told elsewhere in these pages. Sufficient for the moment to say that the Queen's Empire overseas is directed by most capable hands, both in the central Government and on the spot.


Table of Contents
Previous Chapter (2) ** Next Chapter (4)

Transcribed and formatted for HTML by Patrick Clancey, HyperWar Foundation