Colonial capitalism refers to the exploitation of resources and labor in the Global South by the Global North. While ‘industrialisation’ refers to a country’s economic transition, the United Nations states that the Global North and Global South are systems that are interchangeably referred to as more and less industrialized countries (Kenny, 2024). Colonial enterprises were from the beginning a matter of growing capital (Blaut, 1989). From the 16th to the 17th century, the exploitation of the Global South by colonial powers generated enormous wealth. First through gold and silver, and later through coffee and spice plantations (Blaut, 1989). Colonial capitalism offers a better understanding of how the Global North gained power by exploiting colonies and extracting resources from the Global South (Ince, 2018), while highlighting that this dominance is still deeply ingrained in nowadays societal and economic structures. The following text provides examples of oppressive practices rooted in colonial mindset, such as forced labor and systemic marginalization.
Framing & Perspectives
Besides its first usage by anti-colonial thinkers, the term appeared in Marxist theories as the concept of initial accumulation, which Marx explained as the “origin” of capitalism (Woodis, 1972. It was referring to the use of violence in order to start the extraction and profit of resources, as well as labor at the expense of the colonies (Rodney, 1972). From there, the concept later evolved into monopoly capitalism as the foundation for colonial capitalism, where monopoly capital seizes the most important sources of raw materials (V.I. Lenin, 1916). Chartered Trading companies made the exploitation legal to benefit, for example, the British East India Company and the Dutch East India Company (Arrighi, 1994). In order for colonial capitalism to work effectively, the need to create racial hierarchies became of great importance. These hierarchies strengthened and institutionalized the justification of the extreme forms of exploitation on which the system relied. Seen in the enslavement of Indigenous people who were forced into labor through coercion, tribute systems, and the seizure of their own lands. Later, with the expansion of African slavery, millions of Africans were transported and sold into plantation-based labor. By making this system of “inferior” or more “suited” for hard labor, colonial authorities produced a racial logic that made exploitation appear natural, efficient, and morally acceptable.
These groups were purposely separated and assigned to different levels of control, which enabled colonial authorities to control and justify the unequal treatment (Robinson, 1983). The differentiation allowed the British and Dutch East India Companies to pay different wages, or none at all, thereby maximising profits (Williams, 1944). This resulted in colonial corporations establishing an economic order designed entirely for their benefit. In this order, local officials monopolized local commerce, controlling trade and resources at the expense of the colonies (Marx, 1867). Meaning that when a product produced in the colonies was sold back to them, it would be sold at a much higher price. Creating a dependency of the colonies on the British and Dutch East India Companies, a system was enforced in which the colonies could not benefit from (Marx, 1867). The selling back of the products is still seen today, creating a hierarchical global supply chain (McEachern, 1982). For example, former French colonies such as Martinique and Guadeloupe are officially part of the European Union. This allows companies to import products at low prices and increase the prices of local products. Often, it is cheaper to buy cow’s milk from European producers than from local farmers.
Relevance
Colonialism was not only a historical phase but a system that is still shaping capitalism nowadays. From the rise of European empires, there has been the use of force to marginalize communities, extract resources from sacred lands, and create wealth at the expense of those who were enslaved (Amin, 1976). Former colonies still face structural disadvantages that are rooted in their colonial past (Ziltener et al., 2017). These disadvantages are evident in the weak industrial base and long-term economic inequality that persist to this day, reflecting the hierarchy created by the colonizers without establishing laws.
Keywords: Capitalism, Colonialism, Forced Labour, Monopoly, Slavery
Connected terms: Colonialism, Feudal Power Structures, Colonial Mindset, Racial Capitalism, Marginalization, Global Capitalism
References
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