The making of colonial capitalism: intensification and expansion in the economic geography of the Cape Colony, South Africa, 1854-1899¶

Literature › Works

Alan Spencer Mabin (1984). The making of colonial capitalism: intensification and expansion in the economic geography of the Cape Colony, South Africa, 1854-1899. PhD thesis, Department of Geography, Simon Fraser University. Simon Fraser University.


Type	thesis
Scope	Wider apartheid literature
Method	archival narrative
Period studied	1854–1899
Regions	Cape Colony, Port Elizabeth, Cape Town, Kimberley/Griqualand West, Transvaal/Witwatersrand, Bechuanaland/Rhodesia, Orange Free State
Themes	origins segregation, mining migrant labour, agriculture land, business and state, macro fiscal finance debt, labour markets wages, unions strikes, demography urbanisation, comparative theory, manufacturing industrial policy
Citation key	`mabin1984`

Argument¶

The thesis argues that the redirection of capitalist activity from the Cape coast to the interior (first the Kimberley diamond fields, then the Transvaal gold fields) was generated within the Cape Colony as a response to the severe recessions of the 1860s and 1880s. Mineral discoveries are treated as the product of a depression-driven search for new opportunities, not as accidents. The 'imperial factor', capital formation and commodity production are treated as secondary or contributing causes. A corollary is that the commitment to northward expansion damaged intensification of productive activity within the colony, leaving the Cape a commercial colony serving an industrial hinterland. The case is made through periodised economic narrative of merchant capital, banks, railway politics, wage labour and company formation, using colonial parliamentary papers, bank archives and newspapers.

Evidence and method¶

Cape Blue Books and Statistical Registers; the 1865, 1875, 1891 and 1904 censuses; Votes and Proceedings and their annexures (Select Committee evidence, GMR reports, Labour Commissions); Hansard; Standard Bank Archives (inspection reports, general managers' letters); Barlow Rand Archives (Eckstein letters); Cape Archives; the Smalberger and Merriman papers; chambers of commerce reports; period newspapers and secondary literature (Purkis, Turrell, Worger, Dubow, Schreuder, Wilburn and others).

Place in the debates¶

External (imperial/world-market) versus internal forces in colonial development (see Pre-Union colonial economy, the mineral revolution and the South African War). Takes the Butlin-type 'local decisions' side of the Australian debate against Fitzpatrick-style dependency. Argues that Cape merchants, farmers, banks and government, not metropolitan finance, shaped the direction of expansion, while acknowledging constraints from capital access and staple prices.
Imperial factor and Cape expansion (De Kiewiet, Robinson and Gallagher, Atmore and Marks, Schreuder) (see Pre-Union colonial economy, the mineral revolution and the South African War). Sees imperial policy as coinciding with, and sometimes opposing, local economic expansionism. Stresses that internal economic dynamics of the Cape have been neglected in this literature.
Were mineral discoveries accidental 'windfalls'? (see Pre-Union colonial economy, the mineral revolution and the South African War). Follows Blainey: discoveries were not accidental but came from prospecting intensified by depression. Rejects the De Kiewiet and Theal 'windfall' orthodoxy.
Were the Cape railways built to reach the diamond fields? (see Pre-Union colonial economy, the mineral revolution and the South African War). Rejects Browett and De Kock. Until the early 1880s the railways aimed at pastoral hinterlands and merchant rivalries, and Kimberley became the focal point only later (1881 Act, 1885 line).
Mercantile bourgeoisie and industrial underdevelopment (Naylor's Canadian staples thesis) (see Pre-Union colonial economy, the mineral revolution and the South African War). Applies the Naylor argument to the Cape. Capital went to the carrying trade and to the Transvaal, not to local industry or intensification of the colony's own production.
Origin of closed compounds in Kimberley (see Pre-Union colonial economy, the mineral revolution and the South African War). Rejects the orthodox diamond-theft explanation (Smalberger). Compounds were mainly a tool of labour control and discipline, tied to underground mining, convict labour and the 1884 strike, with whites excluded from compounding.
Historical geography: descriptive and diffusionist versus economic-history explanation (Christopher, Browett, Norton) (see Historiographical approaches). Rejects descriptive, anthropomorphic and quantitative-mechanistic work. Uses a diachronic economic and social history to explain geographical change.

Findings¶

The 1869-72 boom was not purely a diamond boom; pastoral products contributed more than diamonds up to 1872. (p. 141)

The total increase in trade due to pastoral products was somewhat more than that due to diamonds up to 1872.
Early Cape railway planning targeted pastoral hinterlands, not Kimberley. (p. 176)

The railways, it may be concluded, then, rode the sheep's back as much as did the economy as a whole.
The 1881 diamond share collapse transferred Cape capital to Kimberley magnates. (p. 190)

Over half of the £12 million capital invested in the diamond mining industry by 1881 had been subscribed in the Cape Colony
The 1884 Kimberley strike ended with six strikers shot dead and racial separation of workers reinforced. (p. 221)

for the first time in Cape history, six workers on strike were killed by police.
Compounds served labour discipline, including under underground mining, rather than only theft control. (p. 225)

The compounds fostered tighter discipline. They allowed the mine companies to maintain a reserve supply on their own premises
Cape money capital was drained to the Rand after 1886. (p. 256)

the overall impact was to withdraw an enormous sum of money capital from the Cape to the Transvaal, probably reaching several million pounds in the first few years of Rand gold mines.
Cape railway policy in the 1890s subordinated internal development to northward expansion. (p. 304)

In the following four years, almost no additions were made to the railway system within the Cape Colony.
Through traffic to the Transvaal was a modest share of Cape railway activity despite the rhetoric. (p. 296)

the through traffic represented only 20 to 25 per cent of railway revenue and 'only about one-seventh of the total tonnage'
Manufacturing stayed small, with low investment and flat value added per worker. (p. 317)

value added per worker remained more or less constant at about £105.
Cape farmers relied on manual labour and state labour legislation rather than mechanisation. (p. 322)

Along with the earlier Locations Act of 1892, which forced many Africans and other squatters off white owned farms, legislation contributed to easing the labour pressure complained of by farmers

Evidence ledger¶

Sources used¶

Source	Kind	Period	How used
Cape Blue Books (1855-1885), later Statistical Registers (1886-1905)	official statistical series	1850-1905	Basic statistical series on trade, exports, wages, prices, road expenditure, towns, manufacturing and wool, used to identify phases of boom and slump and map indicators.
Cape Colony population censuses 1865, 1875, 1891 and 1904	population census	1865-1904	Population by region and race, town sizes over 2000, manufacturing employment and output, ostrich and wool numbers.
Cape Votes and Proceedings of Parliament, Annexures (Select Committee reports and evidence, departmental reports)	commission or official report	1854-1900	Evidence on railways, labour, industries, coal and harbours, together with General Manager of Railways reports, Diamond Mine Inspector reports and loan statements, underpins the political and economic narrative.
Cape Parliament debates (Hansard, House of Assembly; Legislative Council Debates)	parliamentary debates	1854, 1867-1899	Used to reconstruct railway politics, protection motions, labour/diamond legislation and Rhodes-Bond alliance.
Standard Bank Archives, Johannesburg: Inspection Reports and General Managers' correspondence (GMO, JAH 6/2/1, GM-LO)	company records or reports	1860s-1899	Chief archival source for credit conditions, branch trade conditions, bank policy, farmer and merchant indebtedness, and shift of capital to the Transvaal.
Standard Bank Branch Opening and Closing Card Index; Barclays Bank Museum Archives Smith files	company records or reports	1860-1900	Source for compiled counts and maps of banks and branches (Table 4.4, Figures 3.6, 3.10, 4.7, 6.4).
Barlow Rand Archives: Hermann Eckstein correspondence (HE 124)	company records or reports	1886	Letters document the flow of Kimberley money to Barberton and the Rand in 1886.
Cape Archives, University of Cape Town (Smalberger Collection, Judge Papers) and Wits Library manuscripts (De Beers minute books, Maund, MacKenzie, Merriman papers)	state archives	1860s-1890	De Beers and Kimberley Central minute books, Merriman correspondence and Southey papers support accounts of compounds, amalgamation and politics.
Port Elizabeth and Cape Town Chamber of Commerce annual reports	employer association records	1870s-1899	Document merchants' complaints on harbour, railway rates and trade diversion.
Newspapers of the period (Argus, Eastern Province Herald, Diamond Fields Advertiser, Daily Independent, SA Commercial Advertiser, Graaff-Reinet Herald, etc.)	newspapers periodicals	1854-1899	Source for strikes (e.g. 1854 boatmen, 1884 Kimberley), railway agitation, labour complaints and company flotations.
Directories and almanacs (Cape Almanac, General Directory, Argus Annual)	secondary literature compilation	1850-1899	Company boards, joint-stock companies, bank locations, and gold company flotations.
Cape Colony Statutes	legislation gazette	1856-1892	Masters and Servants Acts, labour legislation and Act 22 of 1867 used for labour control.
British Parliamentary Papers C.1244 (Carnarvon to Barkly 1875)	commission or official report	1875	Confederation dispatch used for imperial motives.
Turrell's thesis diamond export and production data (App. II.4)	secondary literature compilation	1869-1887	Diamond export values used in Tables 4.1, 4.3, 5.2 combined with Blue Books.
Mitchell and Deane, Imlah, Simon and Cairncross British trade and investment statistics	international trade or finance data	1850-1914	Tables 2.3 and 2.4 on British trade and portfolio investment for the international context.
Wilburn thesis railway revenue and traffic tables	secondary literature compilation	1891-1899	Tables 6.2 and 6.3 on shares of railway revenue and Cape railway returns.

New data¶

Compiled statistical series (trade, exports, banks and branches, towns over 2000, insolvencies, property transfers, railway revenue, municipal valuations, cement imports, manufacturing 1891/1904) from Cape Blue Books/Registers/Censuses, and maps and tables derived from them; no new survey data.

Inference¶

Quantification: Descriptive tables.

Historical-geographical narrative: periodised by compiled statistical series and maps (boom/slump), then explained through archival, parliamentary and press evidence of merchants', banks', government and mining interests; comparison with Australian and Canadian debates; argument by elimination of rival explanations.

Key claims¶

Claim	Basis	Strength
The redirection of capitalist activity to the interior was generated within the Cape as responses to the recessions of the sixties and eighties. (p. 26)	Cape Blue Books/Registers, Standard Bank inspection reports, parliamentary debates, company flotation data, newspapers; narrative sequence of slump and expansion.	Partial data
Northward commitment led to neglect of intensification within the Cape, in railways, agriculture, manufacturing and coal mining. (p. 327)	Railway debates and Hansard, GMR reports, 1891 and 1904 censuses (Table 6.6), select committees on coal, Standard Bank reports.	Partial data
Port Elizabeth declined relative to Cape Town in the eighties owing to harbour neglect, railway routing and rates, and the Standard Bank's move. (p. 215)	Trade figures (Figs 3.7, 3.8), PECC and CTCC reports, Standard Bank archives, parliamentary records.	Partial data
The 1874 railway scheme was aimed at pastoral hinterlands, not the diamond fields, and was the outcome of competing mercantile interests resolved politically. (p. 176)	1868 Select Committee evidence, Chamber of Commerce positions, Purkis's thesis, newspapers.	Partial data
Mine companies introduced closed compounds and racial separation of workers after the 1884 strike and during the recession. (p. 226)	De Beers minute books, Diamond Mines Inspector reports, Commission on Diamond Mining 1882, newspapers.	Partial data
Money capital flowed from Cape and Kimberley investors to Barberton and the Witwatersrand; Cape interest in the Transvaal developed over a long period. (p. 256)	Standard Bank letters, Eckstein correspondence, company flotation lists in Argus Annual, Goldmann.	Partial data
The Rhodes-Bond alliance, cemented by share distributions, shaped Cape government policy toward northward expansion. (p. 277)	Hansard, Michell biography, Maylam's account of BSA shares.	Partial data

The author's caveats¶

Cautions that Cape statistics must be used carefully, especially for diamonds; notes that 1891 manufacturing figures were adjusted and slightly exaggerate growth; the capital flow to the Transvaal is described as non-quantifiable; notes the loss of Oriental Bank and Bank of Africa records and that sources for further research on industry are unclear.

Gaps in the evidence¶

The central claim about capital diversion to the north is supported by anecdotal company flotations and bank letters, not systematic estimates of capital flows by sector and region. Linked company, share register, bank balance-sheet and mortgage data (some in surviving archives, e.g. deeds registry, Cape Archives) could test it. Counterfactual evidence on returns to internal investment, and farm- and household-level data on rural conditions, are largely missing.

Replicability: Data described but not public.