Financing the Indian Ocean Slave Trade

Abstract

The finances underpinning the traffic in enslaved people across and around the Indian Ocean is one of the least understood factors of the trade. Comprehension of this complex history requires a consideration of all stages of the slave trade: enslavement mechanisms, the traffic and transportation of captives, and the uses of enslaved labor and capital. It also requires a broad definition of finance. Circulations of capital and credit underpinned the traffic in enslaved people, as much as the trades in Indian Ocean commodities that accompanied human trafficking. The role and business organization of merchant networks is a crucial part of this history. Muslim merchants could draw on a common faith and kinship to organize their commercial relationships, but they also relied on extensive networks of Islamic law. Gujarati merchants pooled capital and labor within extended kinship networks but disputed financial transactions in imperial courts. Both networks, however, depended on their African partners and agents to supply captives and established those relationships through gift-exchange, debt, or manumission. Thus, financial mechanisms, such as debt and pawnship, that were internal to slave-supplying societies were central to enslavement. On the other end of the trade, slave-owners in various Indian Ocean societies mobilized their slaves as security for loans, as credit that could be used to finance trading expeditions that produced more captives or to underwrite agricultural production on slave plantations. Yet credit networks also facilitated the social mobility of enslaved individuals in the Indian Ocean world (IOW), enabling some individuals to participate in commercial life and purchase property and sometimes even their own freedom. Europeans entering the IOW initially participated in and drew upon these existing financial structures of enslavement, trafficking, and slavery. Yet plantation agriculture and artisanal industries that European, Asian, and African societies developed during the long 19th century both intensified Indian Ocean slave trades and demanded new forms of capital investment. In this context, some European capital came from the Atlantic trade. British anti-slavery activities ultimately put an end to the legal traffic of captives across the Indian Ocean, though illegal trades, new forms of bondage, and internal slaveries continued into the 20th century. British interventions disrupted Indian Ocean financial networks more broadly, resulting in new forms of indebtedness in East Africa.