Dutch East Indies

The Netherlands held the second place among the successful colonising nations, though Powers like England, France, and Germany surpassed her in the actual area of their colonies and protectorates. The colonial possessions of the Netherlands, situated in the East Indies and the West Indies, embraiced an area of about 783,000 English square miles. Besides her East Indian possessions, which form by far the most important part of her colonial empire, she held Surinam, or Dutch Guiana, and six small islands, including Curacao, in the West Indies, and her colonial subjects number in all more than thirty-six millions, being as many as the colonial subjects of France and at least seven times the population of the Netherlands in Europe.

In 1602 the Dutch created their East India Company, the Vereenigde Oost-Indische Compagnie [VOC, less often VOIC] in Dutch, literally "United East Indian Company". This Company conquered successively the Dutch East Indies, and ruled them during nearly two centuries. The famed Dutch East India Company was a source of immense wealth to Holland, and of continual heartburnings and jealousies between herself and other nations. The commencement of the career of the new East India Company was one of almost uninterrupted prosperity. The Commercial Company or East Indian Company obtained a monopoly of the trade of the Indies. The Company dealt with the Indies for purely commercial ends, and it came to figure as a sovereign power against its will; as it was obliged to reduce by force of arms the native states which refused the only thing for which the Company sued, namely, a certain quantity of the products of the country : spices, cotton thread, vanilla and cinnamon, for which it paid little or nothing, according to circumstances, and sold at very high prices in a market whose rates the Company itself established, thanks to the absence of competition. By such means it earned enormous profits. It was in nowise inclined to squander them upon Imperialistic expeditions, which is the reason why it conquered, almost in self-defence, its immense possessions, according to the degree in which they might maintain or increase its profits.

Not only continuous wars on Java but also the VOC's own greed and shortsightedness led to its undoing by the end of the eighteenth century. Its personnel were extraordinarily corrupt, determined to "shake the pagoda tree" of the Indies, to use a phrase popular with its eighteenth-century British contemporaries, to get rich quick. Although the VOC preserved its monopoly over the spice trade, it could not prevent foreign rivals, especially the British and French, from growing spices on their own territories in the West Indies and elsewhere.

After 1700 the Dutch East India Company fell behind rapidly. It enjoyed such a high reputation, and kept its condition secret so successfully, that its credit was unimpaired, and it continued to pay dividends by borrowing money. For nearly two hundred years it declared dividends at rates ranging from 12£ per cent to 20, 40, or even 50 per cent; the average dividend from 1602 to 1796 was over 18 per cent. The crash was bound to come finally; the company paid its last dividend in 1782, and was dissolved in 1798, leaving debts of over fifty million dollars, which were assumed by the Dutch government.

In 1798 the Crown of Holland displaced the Company, and proceeded to draw the greater part of the wealth of the Indies. The Crown, it appeared, had no idea of repairing the errors of the Company ; it was equally careless of the needs of the natives; it distrusted all Dutchmen who were not in its service; it had the same utilitarian and egoistical conception of exploiting the.

Nineteenth-century Indonesia experienced not only the replacement of company rule by Dutch government rule but also the complete transformation of Java into a colonial society and the successful extension of colonial rule to Sumatra and the eastern archipelago. The modern state of Indonesia is in a real sense a nineteenth-century creation. It was during this century that most of its boundaries were defined and a process of generally exploitative political, military, and economic integration begun.

The East Indian Archipelago belonging to the Netherlands consists of five large islands and a great number of smaller ones. The three groups which make up this dependency are extended over a length of about three thousand miles, and include Java and Sumatra, Borneo, Celebes, New Guinea, the Timor archipelago, and the Moluccas. The northern part of Borneo was a British possession, and the eastern half of New Guinea is divided between England and Germany, while half of the island of Timor was Portuguese ; the rest of the archipelago forms the possession known as Netherlands India, or the Dutch East Indies. The most important and the most densely populated of these islands are Java and Sumatra ; at the census in 1899, Java alone had twenty-six millions of inhabitants, more than four times as many as in 1826, but the richness of its soil was so great that it could support a much larger population, though the island is only about the same size as England.

Java was taken by the English in 1811 from the French flag, but was restored at the Peace of Vienna to the Netherlands, together with some of the other Dutch colonies. As Dr. Bright remarks in his History of England, " It has been believed that its value and wealth were not thoroughly known or appreciated by the Ministry at the time." It became by far the most important of the Dutch dependencies, and the favourite colony for fortune-hunters.

Considering the great wealth of the Dutch Indies, it was a little surprising that so few young men were tempted to go out there to seek their fortunes. As is usually the case in the tropics, those parts of the coasts which are low and marshy are very unhealthy for Europeans, who cannot stay in such places for any length of time without falling victims to malaria, though the Malays do not seem to be affected by the climate; but higher up, from 500 to 1000 feet above the sea, it is healthy enough, and up the hills, in the larger islands, the climate leaves little to be desired.

The problem which confronted the Dutch authorities was the old one of uniting under one government populations differing in blood and religion, a problem which always presents great difficulties and even a certain amount of danger. The system adopted resembles, to some extent, that applied to certain native States in British India, and the islands are governed by native kings and princes, under the paternal supervision of the Netherlands India Government. Throughout these dependencies the aim of the Government was to rule the inhabitants through men of their own race, not to substitute foreigners for natives.

The Dutch possessions in the East Indies are divided into residencies, divisions, regencies, districts, and dessas (villages). They are also very often divided into: (1) Java and Madura ; (2i the Outposts-Sumatra, Borneo, Riau-Lingga Archipelago, Baiica, Billiton, Celebes, Molucca Archipelago, the small Sunda Islands, and a part of New Guinea. Java, the most important of the colonial possessions of the Netherlands, was formerly administered, politically and socially, on a system established by General Johannes Graaf Van den Bosch in 1832, and known as the 'culture system." It was based in principle on the officially superintended labour of the natives, directed so as to produce not only a sufficiency of food for themselves, but a large quantity of colonial produce best suited for the European market. The whole of Java - including the neighboring island of Madura - was divided into seventeen residencies, each governed by a Resident, assisted by several Assistant-Residents and a number of subordinate officials, called Controleurs. The Resident and his assistants exercise almost absolute control over the province in their charge ; not, however, directly, but by means of a vast hierarchy of native officials.

The Dutch Indies were absolutely safe because England did not covet them, and would never dream of molesting the Dutch in them provided she herself remains unmolested. But should international competitions break out in that quarter of the world Holland might experience some difficulty in maintaining her garrison at an adequate strength for the proper discharge of her international duties, but at the outset of the 20th Century this contingency was not likely to present itself for another twenty or thirty years.

Lacking indigenous resources, Japan depended on oil imports -- mostly from the US -- to fuel its powerful military, especially its naval and air forces. Japan had been engaged since 1937 in the conquest of China, and increasingly the Japanese Government was succumbing to the control of war lords who aimed at Japanese domination of all East Asia and Indonesia. German occupation of the Netherlands in May 1940 led to Japan's demand that the Netherlands Indies government supply it with fixed quantities of vital natural resources, especially oil. Further demands were made for some form of economic and financial integration of the Indies with Japan. Negotiations continued through mid-1941. The Indies government, realizing its extremely weak position, played for time.

Ultimately, in response to continued Japanese moves in China and Indochina, the US cut off all oil to Japan in 1941. This placed key factions in the Japanese government in an untenable position, and they decided to seize the oil-rich Netherlands East Indies (NEI). The first Japanese landing came on 17 December 1941 near Miri in the Sarawak province of Borneo. The Battle of the Java Sea resulted in the Japanese defeat of a combined British, Dutch, Australian, and United States fleet. On March 9, 1942, the Netherlands Indies government surrendered without offering resistance on land.