Trade and exploration
During the 16th century exploration and trade were closely linked. London merchants and ship-owners initiated many of the great voyages of discovery.
|Full hull model of an Elizabethan Merchantman. © NMM|
Exploration and trade were both risky. Ships were in danger from pirates, enemy shipping, unfriendly local rulers and bad weather.
The joint stock companies
To share the risks, merchants with similar interests joined together in a joint stock company. This could raise capital from landowners and other investors.
|The adventurers Captain John Davis, Sir Walter Raleigh, Sir Hugh Willoughby and Captain John Smith. © NMM|
Examples included the Turkey Company, established in 1581, and the Venice Company in 1583. The government promised such companies a monopoly if they opened up trade with new countries.
During the 16th century London's world-wide trading links grew because of the activities of the joint stock companies.
A new route to the East?
Sir Hugh Willoughby and Richard Chancellor sailed from Deptford in 1553 in charge of a venture arranged by London merchants. Its aim was to find a north-east passage to the Far East.
|Sea chart of the passage from England to the Baltic. © NMM|
They did not find a route to the East and Willoughby and his men died in the frozen wastes of Lapland.
The Russia Company
Chancellor, however, landed in Russia and began trading in Moscow with Ivan the Terrible. This led to the founding of the Russia Company in 1555, one of the most successful early maritime companies.
|Sebastian Cabot (1474-1557). © NMM|
It imported furs, tar, iron and copper to London. Queen Elizabeth herself was one of the shareholders.
Sebastian Cabot, son of John Cabot, who had sailed to North America in 1498, headed the company.
The East India Company
The most important of the new companies was the East India Company.
|Sir James Lancaster, commander of the first fleet sent to the Indies by the East India Company in 1601. © NMM|
For many years, the Dutch had monopolised the spice trade and in 1599 they raised the price of pepper from 3 shillings (15p) a pound to 8 shillings (40p) a pound.
Exasperated London merchants called a meeting, chaired by the Lord Mayor. As a result, in 1600, Queen Elizabeth I signed the Charter creating the English East India Company.
East Indies bound
The following year, Sir James Lancaster sailed from Woolwich for the East Indies with a fleet of five ships.
|The East India Company's Yard at Deptford, c. 1660. © NMM|
The fleet sailed for the Banda Islands off Indonesia, which were the centre of eastern spice growing.
Cotton for spice
Lancaster found it hard to exchange his English cloth for spices in the East Indies. However, after he captured a Portuguese carrack full of Indian cottons, he was able to trade these instead.
|A Portuguese Carrack before the wind. © NMM|
Two and a half years later, he returned with a cargo of pepper. Soon afterwards the Company developed its own shipbuilding yards and warehouses on the west side of Deptford Creek. The Company prospered and later played a key role in the growth of the British Empire.
New quays required
The rise in London's global trade meant new facilities were needed to load and unload ships. The Crown was the first to build new quays because its customs revenue was less than satisfactory.
|A map of London and the Thames, c. 1580. |
Elizabeth I set up a Commission in 1588 to choose 'legal quays' at which all foreign goods were to be landed. All 20 quays with these privileges were located in the short distance between London Bridge and the Tower.
These eventually became inadequate and merchants were at the mercy of the legal quays' owners. To reduce congestion 'sufferance wharves' were introduced with fewer privileges.
Antwerp and Sir Thomas Gresham
Other events helped the growth of London's commerce during the 16th century. Early on in the century Antwerp had become the great storehouse of Europe, but it was destroyed in 1576 when the people of the Low Countries rose up against the Spanish.
|Interior of the original Royal Exchange, c. 1569. |
London merchants and financiers took advantage of this to make London the new commercial and financial centre of Europe. The greatest of these was Sir Thomas Gresham (1517/18–79), advisor to Elizabeth I.
Gresham was chiefly responsible for establishing the Royal Exchange in 1565. It soon became a symbol of London's wealth and power.
The Royal Exchange
The Royal Exchange was built at the junction of Cornhill and Threadneedle Street in the City. It was a meeting place for merchants and brokers and became the centre of London's business life.
|The front of the second Royal Exchange building, opened in 1669. |
Space was also provided for over 100 shops within its courtyard. The original building was destroyed in the Great Fire of 1666.
A second Exchange opened in 1669. Much of the property was taken over by Royal Exchange Assurance and Lloyd's of London.