GEC105 Readings in Philippine History Final Report PDF

GEC105 – READINGS IN PHILIPPINE HISTORY A WRITTEN REPORT ON THE SPANISH COLONIAL SYSTEM IN THE PHILIPPINES Submitted by: GROUP 2 – N20-2 Castillon, Ariane Klair V. Hervas, Jose Gabriel C....

GEC105 – READINGS IN PHILIPPINE HISTORY A WRITTEN REPORT ON THE SPANISH COLONIAL SYSTEM IN THE PHILIPPINES Submitted by: GROUP 2 – N20-2 Castillon, Ariane Klair V. Hervas, Jose Gabriel C. Portugal, John Francis L. Rosales, Adrian R. Solera, Eric M. Tadeje, Deandre Jerrick S. Submitted to: Prof. Arlyn Joy M. Hervias, MAPS  The Spanish colonial system in the Philippines lasted for over 300 years, from 1565 to 1898. It shaped the country’s political, social, religious, and economic landscape. Spain was the first European country to rise as one of the countries that had the greatest colonizing power in the Philippines. The Recopilación de las Leyes de los Reynos de las Indias (Compilation of the Laws of the Kingdoms of the Indies) is a comprehensive legal code issued by the Spanish Crown in 1680. It aimed to regulate and standardize the governance of Spain’s colonies in the Americas and the Philippines.  Designed to consolidate, systematize, and codify the numerous laws, decrees, and ordinances that had been issued over the years for the administration of Spain’s overseas territories. It served as a guide for colonial officials on how to govern and administer justice in these territories.  Contained laws regarding a wide range of subjects, including governance, taxation, the rights and treatment of indigenous peoples, commerce, and the role of the Catholic Church. It also outlined the responsibilities of colonial administrators, such as viceroys, governors, and other officials.  Dealt with the rights and protections of indigenous peoples. While it aimed to prevent abuses by colonial authorities and encomenderos (Spanish settlers), its enforcement was often inconsistent, and abuses still occurred.  Consists of nine books, each divided into titles and laws, namely: o Book I: The Catholic Church and religious matters. o Book II: The Royal Council and administration. o Book III: Relations with indigenous populations. o Book IV: Administration of justice. o Book V: Military and defense. o Book VI: Economic matters, such as taxation and commerce. o Book VII: Public works and infrastructure. o Book VIII: Regulations on agriculture, mining, and industries. o Book IX: General legal provisions and governance.  One of the most important legal documents in Spain’s colonial history and remained in force, with modifications, until the end of Spanish rule in the Americas and the Philippines in the 19th century. PATTERNS OF COLONIZATION I. The Royal Ordinance on Pacification (Ordenanza de Descubrimiento, Nueva Población y Pacificación de las Indias) was a set of Spanish laws and policies aimed at guiding the conquest and pacification of newly discovered territories in the Americas and the Philippines. These ordinances were meant to regulate  how Spain could expand its control over indigenous populations, establish new settlements, and bring the areas under Spanish rule. II. The sandugo, or blood compact, was a traditional Filipino ritual symbolizing friendship, alliance, and trust. It became a significant event during the early stages of Spanish colonization in the Philippines. The most famous sandugo took place between the Spanish explorer Miguel López de Legazpi and the Boholano chieftain Datu Sikatuna in 1565. This event was a strategic tool in Spain’s colonization efforts. III. The polo, or polo y servicio, was a system of forced labor imposed by the Spanish colonial government in the Philippines. It required male Filipinos to perform labor for public projects and was a significant aspect of Spanish colonial administration. While it was primarily a means to extract labor from the indigenous population, the polo system also had implications for maintaining the loyalty of the local elite, particularly the datu class. IV. The Divide and rule method and the repartimiento system were strategies and systems employed by the Spanish colonial administration in the Philippines to consolidate and maintain control over the archipelago. a) Divide and rule (also known as divide and conquer) is a strategy used to gain and maintain control over a territory by breaking up larger concentrations of power into smaller, more manageable groups. This method aims to prevent unified resistance by creating divisions among the local population. b) The repartimiento system was a form of forced labor implemented by the Spanish Crown, which required indigenous people to work on public projects or for Spanish landholders where local communities were required to provide labor for specific periods. This labor was used for building infrastructure, mining, and agricultural work on Spanish-owned lands or public projects. V. Since the country was divided into scattered barangays, reducción which refers to the Spanish policy of resettling and concentrating indigenous populations into organized towns or settlements, happened. This policy aimed to facilitate control, conversion, and administration of the indigenous people by centralizing them in manageable locations. Reducciones is the term for the towns or settlements established under the policy. POLITICAL CHANGES AND CENTRALIZED GOVERNMENT Chart of the Spanish Colonial Bureaucracy THE POLITICAL STRUCTURE During the Spanish colonial period in the Philippines, the national government structure was designed to enforce Spanish rule and manage the colony's affairs. I. King of Spain  The ultimate authority over all Spanish territories, including the Philippines. The Crown held the highest legislative, judicial, and executive powers.  Issued decrees and policies that shaped colonial administration and oversight through various councils and officials. II. Council of the Indies (Consejo de Indias)  An advisory body to the Spanish Crown responsible for colonial affairs and administration.   Oversaw the administration of Spanish colonies, including the Philippines, providing advice and directives on governance, legal matters, and appointments.  In 1863, the council was replaced by the Ministry of Overseas Colonies (Ministerio de Ultramar). III. Viceroyalty of New Spain  Initially, the Philippines was part of the Viceroyalty of New Spain, with its administrative center in Mexico City.  Acted as the representative of the Spanish Crown in overseeing colonial territories in the Americas and the Philippines. The Viceroy was responsible for implementing policies and managing colonial affairs in these regions. THE EXECUTIVE BRANCH I. The Governor-General  The highest-ranking official in the Philippines, appointed by the Spanish Crown or the Viceroy of New Spain.  Acted as the chief executive, judicial authority, and military commander in the colony. Manages the administration, defense, and economic affairs of the Philippines, implementing policies from the Spanish Crown. THE LEGISLATIVE BRANCH I. The Royal Audencia  The highest court of justice in the Philippines, established to handle legal and judicial matters.  Oversaw the administration of justice and served as a court of appeal. It also had administrative responsibilities, including advising the Governor-General and overseeing certain aspects of colonial governance. II. The Residencia  Ensured accountability and proper administration by colonial officials.  Investigated and addressed grievances, misconduct, and corruption among high-ranking officials. III. The Visita  Functioned as a tool for inspection and oversight within the Spanish colonial administration.   Conducted inspections of various colonial institutions and officials to ensure proper administration and adherence to Spanish laws and policies. THE LOCAL GOVERNMENTS I. Alcaldías  An administrative division in the Spanish colonial system, each headed by an Alcalde Mayor, the chief executive of an alcaldía responsible for provincial administration, justice, and coordination of local governance.  Managed provincial affairs, implemented policies from the central government, presided over local courts, enforced laws, and handled tax collection.  Covered a broad area, including several towns or municipalities. II. Corregimientos  Were administrative districts managed by a Corregidor, the official in-charge, responsible for administration, justice, and sometimes military functions within the district, often established in regions that required closer oversight.  Similar to an alcaldía but could be used for more specific or problematic regions needing direct supervision.  Oversaw local administration, legal matters, local defense, and economic activities. Acted as a liaison between the central government and the local population.  Could vary in size; often established in areas where more direct control was necessary. III. Municipalities  Often referred to as Pueblos, were smaller administrative units within an alcaldía or corregimiento, typically encompassing a single town or settlement.  Capitan Municipal is the head of the municipality, responsible for local administration.  Managed local governance, implemented provincial or corregimiento policies, maintained public order, and handled local issues.  Focused on individual towns or municipalities, dealing with local concerns and day-to-day administration. IV. Cabeza de Barangay  Cabeza de Barangay was the leader of a barangay, the smallest administrative unit in the Spanish colonial system, responsible for  local governance and community affairs and is composed of a few families or households.  Managed the barangay’s daily affairs, served as an intermediary between the local population and higher authorities, enforced local rules, and helped with community issues.  Focused on very small, localized areas within municipalities, acting as the grassroots level of governance. UNION OF CHURCH AND STATE Various religious orders were deployed to different parts of the Philippines:  Augustinians (1571). Assigned to Cebu, Iloilo, Manila, Pangasinan, and Ilocos.  Franciscans (1577). Sent to Southern Tagalog and Bicol.  Jesuits (1583). Evangelized Eastern Visayas, Cebu, Bohol, Samar, Leyte, and Mindanao.  Dominicans (1587). Assigned to Bataan, Pangasinan, northern Luzon, and the Batanes.  Recollects (1605). Worked in northern Mindanao, Palawan, Zambales, and Jesuit missions after their expulsion (1759).  Benedictines (1895). Later arrivals among religious orders.  Missionaries focused on converting natives to Catholicism. Spanish kings were closely tied to the Church due to their role in propagating and defending the Catholic faith. This union meant Spanish officials in the colony were also defenders of the Catholic faith (Agoncillo and Mangahas, 2020). THE ROLE OF FRIARS AND THE INFLUENCE OF THE FRIAR-CURATE IN TOWNS  Friars were not only religious leaders but also agents of the Spanish king, where the Governor-General had the power to appoint priests in parishes.  Clergy members held significant political power, participating in the Central and local governments.  Served as census enumerator, health officer, school inspector, examiner of students, censor for publications, and auditor of local government.  This gave the friar-curate immense power over the local population, where in certain instances, the highest church official could act as Governor-General in the latter's absence or illness. SPAIN’S ECONOMIC POLICY I. Encomienda Encomiendas assigned by Legaspi, Vol. XXXIV, 304-310 The encomienda system was a legal framework established by the Spanish crown to regulate the status and treatment of indigenous populations in Spain’s American and Philippine colonies. Drawing on practices from the Reconquista, when tribute was exacted from Muslims and Jews in Spain, the system was formally defined in 1503. The term encomienda, derived from the Spanish verb encomendar meaning “to entrust”, referred to a royal grant that assigned a specified number of indigenous people, known as Indios (including Native Americans and later Filipinos), to a conquistador, soldier, or official.  Under the encomienda system, encomenderos were granted the right to collect tribute from indigenous people in gold, goods, or labor. In return, they were supposed to provide protection and Christian instruction. Although the encomienda did not include land grants, encomenderos often gained control over indigenous lands and frequently failed to fulfill their obligations, leading to significant exploitation and hardship for the native populations.  In the Philippines, the tribute system was particularly harsh, imposing severe burdens on the local population. Tribute payments could include gold, pearls, wax, cotton cloth, salt, agricultural products, and labor. For communities focused on immediate needs, these demands were extremely taxing.  The first formal grants of encomienda in the Philippines were issued by Miguel López de Legazpi in 1572. At that time, Legazpi was authorized to allocate encomiendas across the islands to deserving recipients, primarily military officers, while reserving one-third of all grants for the crown. In 1573, the role of Legazpi was expanded to include the right to select an encomienda near each Spanish settlement. Although this right was not available to Legazpi, who passed away in 1572, it became a common practice for subsequent Governors-General to exploit this authority.  In Cebu, Legazpi assigned control of the port and village to the Crown and distributed a total of 6,000 Indians among various encomenderos, including Jerónimo de Monzón, Cristóbal Sánchez, and Francisco Carreño. In Panay, similar distributions were made, with encomiendas given to individuals like Gabriel de Ribera and Luis de la Haya, covering areas from the Araut River to the Pua River and other regions.  There were three types of encomienda: Royal, which belonged to the King, Ecclesiastical, which belonged to the Church, and Private, which belonged to a private individual. Memorial of Bishop Domingo de Salazar on the Abuses Committed by Spaniards Vol. 5 ABOUT DOMINGO DE SALAZAR  Born in La Rioja, Spain on 6 February 1579, died in Madrid, 4 December 1594, he was a Roman Catholic prelate who served as the first Bishop of Manila and was selected by the King of Spain and confirmed by Pope Gregory XIII as the first Bishop of Manila  In 1578, he was appointed as the bishop of Manila and was sanctified the next year in Madrid. He arrived in the Philippines in 1581, together with 8 Franciscan friars, 2 Jesuits and 1 Dominican.  He later erected the 1st Manila Cathedral by the virtue of Pope Gregory VIII’s papal bull as a suffragan of the Archbishop of Mexico. The document highlighted the various abuses committed by Spanish colonizers against the indigenous population in the Philippines. Bishop Salazar sought to advocate for better treatment of the local people and protect them from exploitation.  The Spaniards imposed unreasonable tribute demands on the native Filipinos, often in forms like gold, goods, and labor, which caused severe hardship where many indigenous people were forced to work in harsh conditions for the benefit of the Spaniards, often without adequate compensation or care. Furthermore, encomenderos neglected their responsibilities to protect and instruct the natives, focusing instead on personal gain and exploiting the local population.  The memorial emphasized that the treatment of the indigenous people violated their basic rights as human beings, going against both Christian teachings and Spanish law.  Salazar argued that these abuses were a moral failure of the Spanish colonizers and appealed to the Spanish Crown for reforms. He recommended that proper oversight and more humane treatment be enforced to protect the dignity and welfare of the indigenous people.  The bishop proposed measures to alleviate the exploitation, such as reducing tribute burdens and ensuring that labor requirements were not abusive. He stressed the need for Spaniards to genuinely fulfill their responsibilities to evangelize and care for the indigenous population.  The memorial contributed to discussions on colonial policy, leading to eventual reforms in how indigenous populations were treated in the Spanish colonies.  II. Polo y Servicios Polo y servicio was a practice employed by Spanish colonizers for over 250 years that required the forced labor of all Filipino males from 16 to 60 years old for 40-day periods. The workers could be placed on any project the Spanish wanted, despite hazardous or unhealthy conditions.  Filipino laborers were supposed to be paid for their work.  They should not be sent to distant places so they could return to their families.  Labor should not interfere with the planting and harvesting seasons.  Physically incapable men should not be overworked.  Forced labor was only to be used in cases of absolute necessity.  The number of laborers was to decrease as foreign workers (like the Chinese) volunteered. ABUSES IN PRACTICE  Filipino workers were not compensated for their labor.  Workers were sent to distant provinces, separating them from their families for long periods.  Laborers had to provide their own food while working, despite long hours and harsh conditions.  Workers were often overworked, resulting in the deaths of thousands of Filipino laborers. EXEMPTION FROM FORCED LABOR  To avoid forced labor, Filipinos could pay a fee called falla (from falta meaning “absence”), however, was set at an unreasonably high amount, making it unaffordable for most Filipinos.  The native-ruling elite and their sons.  Persons with disabilities. Decree Regulating Services of Filipinos A Royal decree under the reign of King Philip III, which aims to regulate the repartimiento system that can apply to the natives. The document was written by the Spanish Crown to give instructions to the centralized colonial government of the Filipinas about the regulations and changes on the services rendered by Filipinos. Especially on the changes in the repartimiento system that they want to happen.  The decree passed in the reign of Felipe III and dated May 26, 1609.  The entire decree promulgates by the Spanish crown under the reign of his Royal Highness of Spain, King Philip III.   The Spanish Crown wrote this document for the centralized colonial government of the Filipinas. Especially to the Governor and Captain-General of the Filipinas Islands.  States that no Indians (Filipino Natives) must coerce to work unless there is a lack of labor pool.  Decree also gives power to the Governor, justices, and entrusted officials to prevent any ill-treatment of the Indians from their caciques (native chief) and Spaniards and to punish those who break the law stated in the decree.  Before the decree was created, ill-treatment and forced labor was prevalent in the Filipinas Islands.  Governor, justices, and entrusted officials has the authority in implementing the decree. The decree contains the following conditions:  That this repartamiento shall be made only for necessary and unavoidable affairs; for in so odious a matter, the greater benefit to our loyal treasury, or the greater convenience of the community, cannot suffice; and all that which is not necessary for their preservation, weighs leu than the liberty of the Indians.  That the Indians in the repartamiento shall be lessened in number as the voluntary workers shall be introduced, whether the latter be Indians or those other nations.  That they shall not be taken from distant districts, and from that of their own villages. The choice of all shall proceed without any partially, and so that both the hardships of distances, the burden of the occupations, and compensation for the other circumstances in which there will be more or less grievance, shall be shared and distributed equally. So that all may share the greater and less toilsome services, so that the benefit and alleviation shown to some may not be changed into injury toward others.  That the governor assigns the number of hours that they shall work each day, taking into consideration the lack of strength and weak physical constitutions. That they be given in full wages that they earn for their work. And they shall be paid each day, or at the end of the week, as they may choose.  That the repartamiento be made at a time that does not embarrass or hinder the showing and harvesting of land products, or the other occasions and periods upon which the Indians have to attend to the profit and management of their property; for our intention is that they be not deprived of it, and that they may be able to attend to everything. Therefore, we order the governor that, at the beginning of the year, he shall take note of the building and other matters of our services in which the Indians have to be employed; for if the time is chosen, it may be arranged in such a way that the Indians may receive no considerable injury to their property or persons.   That granting the poor arrangement and plan of the caracoas, and that when remanded to them many Indians generally perish, because of sailing a deck, and exposed to the in clemencies; of storm, we order that these craft be improved and built in such a manner that the Indians may manage the oars without risk of health and life. III. Tributo Filipinos were required to pay tribute as a recognition of loyalty to the King of Spain. Introduced in 1565, the tribute could be paid in cash or in-kind, either in full or on an installment basis.  The initial amount of tribute was eight reales (1 real = 12.5 centavos). It applied to individuals between 16 and 60 years old.  In 1583, the tribute amount was raised, and a portion was designated for the Church, known as the Sanctorum. The tribute system faced opposition due to the abuses committed by Spanish officials in its collection. In 1884, the King of Spain abolished the tribute system due to mounting complaints. It was replaced by the Cedula Personal, which is equivalent to the present-day Residence Certificate Class "A." Order Issued by the Governor for Collection of the Tributes Vol. VIII The Governor-General's orders included specific instructions on the amount and form of tribute, deadlines for payment, and procedures for collection. These were communicated to local officials such as alcaldes mayores and cabezas de barangay. Local officials were responsible for enforcing these orders. They collected the tribute and reported the results back to the Governor-General, with penalties imposed for late or non- payment. The system was monitored by bodies like the Royal Audiencia to prevent abuses.  The tribute system imposed a heavy economic burden on Filipinos, who faced significant financial strain and were often required to provide labor for public works. This led to widespread discontent and resistance, including notable uprisings such as the: o Tondo Conspiracy (1589). An early rebellion in Manila that sought to challenge Spanish authority and the imposition of tribute. o The Dagohoy Rebellion (1744-1829). A long-lasting revolt in Bohol led by Francisco Dagohoy, driven by grievances related to the tribute system and other colonial policies. o The Philippine Revolution (1896-1898). A widespread movement for independence that was fueled by longstanding dissatisfaction with Spanish rule, including the burdens of the tribute system.   In response to growing discontent, various reforms were introduced over time. These included adjustments to tribute rates and attempts to regulate forced labor, though many reforms were insufficient to fully resolve the underlying issues. Efforts were made to regulate the extent of forced labor, though these changes were typically gradual and met with limited success. The Spanish colonial governor issued a formal order regulating the collection of tributes from the indigenous Filipino population under Spanish rule. It was intended to formalize and systematize the collection of tributes to ensure a steady revenue stream for the colonial administration and the Crown. Opinion of Fray Martin de Rada on Tributes Coming from Indians Vol. III ABOUT FRAY MARTIN DE RADA  He is an Augustinian priest one of who accompanied the expedition of Miguel Lopez de Legazpi and Fray Andres de Urdaneta.  Was instrumental in the Christianization of Cebu, (and later in the Philippines) in 1595 and decades onward.  Born on June 30, 1533, died June 12, 1578.  The Most Illustrious Lord, an opinion piece of Fr. Martin de Rada, was written in San Pablo, Manila on June 21, 1527, for the King of Spain. The letter outlines the different conditions under which the Indians in the Philippines paid tribute to the colonizers Fray de Rada strongly opposed the tribute system imposed on the Filipinos, arguing that it was unjust. He believed the tribute collection from indigenous people was excessive and exploitative.  De Rada viewed the tributes as a form of extortion, not aligned with Christian values.  He argued that the Spanish had no right to demand tributes from the indigenous people, especially considering the harsh conditions under which the tributes were collected. The friar asserted that the Spanish had done little to warrant tribute payments, such as failing to properly protect or improve the lives of the indigenous people. He highlighted that the Filipinos were being forced to pay for their own subjugation, with no real benefit to them in return. Fray de Rada urged the Spanish authorities to reform the system, advocating for more just and humane treatment of the native population. He emphasized that any tribute collection should be fair and voluntary, based on actual services rendered to the Filipinos. TAXES FILIPINOS PAID ASIDE FROM TRIBUTES I. Diezmos prediales. A tax which is considered of one-tenth of the produce of the land. II. Donativo de Zamboanga. A tax explicitly used for the conquest of Jolo. III. Vinta. A tax paid by the people of some provinces along the western coast of Luzon for the defense from Muslim raids. THE MANILA-ACAPULCO GALLEON TRADE Map of the Galleon Trade The Manila-Acapulco Galleon Trade lasted for 250 years (1565–1815). Ships sailed between Manila (Philippines) and Acapulco (Mexico), facilitating trade between Asia and the Americas.  It was the first trans-Pacific trade route, connecting Asia, the Americas, and eventually Europe, marking the beginning of modern global trade.   Asian goods such as silks, spices, porcelain, ivory, pearls, and camphor chests were shipped to Acapulco.  Silver from Mexican mines was the primary commodity traded to Asia, especially for Chinese goods.  The trade linked Asia with the Americas, forming the first global trade network.  The galleons sometimes stopped along the California coast for repairs and supplies, marking the start of Spanish interest in the region. Spanish authorities imposed commercial restrictions:  250,000 pesos worth of goods could be sent to Mexico.  500,000 pesos worth of goods could be returned to Manila. Only privileged individuals like high-ranking officials, clergy, and galleon crews were allowed to trade. Furthermore, it generated enormous profits, with returns of up to 400% on goods like silk and spices. It became a monopoly, and the prosperity of Manila largely depended on the success of the galleons. However, attacks and natural disasters were rampant, making the ways dangerous.  English buccaneers like Thomas Cavendish and Francis Drake frequently attacked galleons.  Strong currents, storms, and scurvy took a heavy toll on ships and their crews. Many galleons sank or returned as "ghost ships." In the 19th century, the monopolistic galleon trade declined as other Philippine ports opened to international trade. Mexico’s independence in 1821 ended the trade, along with the annual subsidy (Real Situado) that Mexico sent to the Philippines to keep the colony afloat. SOCIEDAD ECONOMICA DE LOS AMIGOS DEL PAIS Sociedad Economica de los Amigos del Pais (Economic Society of Friends of the Country) was founded in 1781 by Governor-General Jose Basco y Vargas to effectively implement economic policy and promote useful ideas for the colony’s development. The society was organized into sections focusing on:  Factories and Manufacturies  Industry and Popular Education  Natural History  Domestic and Foreign Commerce  Agriculture and Rural Economy It engaged government officials, traders, and merchants in discussions on various economic subjects, published and distributed pamphlets on the cultivation of indigo, coffee, sugar, cacao, and hemp, imported agricultural implements from the United States to improve farming techniques and increase production and introduced advanced agricultural methods. Some of the notable achievements include:  In 1784, it successfully exported indigo to Europe for the first time in Philippine history.  In 1824, it founded the Academy of Drawing, promoting the art of dyeing and providing scholarships.  In 1861, it established an agricultural school in Manila to train farmers in advanced agricultural methods. THE GOVERNMENT MONOPOLIES Established by Governor Basco, with a royal decree issued in 1780, tobacco growing was permitted only in specific provinces: Ilocos, Nueva Ecija, Cagayan Valley, and Marinduque. The sale of tobacco outside the government’s control was forbidden and had exclusive rights to:  Purchase all tobacco products.  Inspect, classify, and prepare tobacco for cigars and cigarettes.  Control exportation and importation of tobacco. Due to widespread issues and abuses, the tobacco monopoly was abolished in 1881. While then, other monopolies occurred.  Local wine or liquor  Gunpowder  Playing cards  Cockfights  Buye (anise) REAL COMPAÑÍA DE FILIPINAS Real Compañía de Filipinas (The Royal Company of the Philippines) was founded in 1785 by Governor Basco, still, to promote progress in the Philippines, improve foreign trade between Spain and the Philippines, and develop the Philippines' natural resources through industry, manufacturing, and agriculture.  Held the exclusive right to trade between Spain and the Philippines.  Products exported from the Philippines to Europe were exempt from tariff duties.  The company’s ships could visit Oriental ports, lifting the previous prohibition on Manila merchants trading with China and India. It increased commercial relations and revenue between the Philippines and Europe and promoted production of indigo, sugarcane, pepper, and other spices.  However, Philippine merchants, used to the galleon trade, were not fully supportive. Then, the company struggled to establish direct commercial contact with Japan, China, and India, resulting in higher prices through intermediaries. Officials were also distracted by activities unrelated to the company's promotion, leading to inefficiency. Foreign ships brought European goods to Manila, including groceries and canned products, which impacted the company's trade. Eventually, the company was abolished in 1834 due to these challenges and inefficiencies. OPENING TO WORLD TRADE  Adoption of liberal laissez-faire economic doctrine led to relaxation of Spain’s mercantilist policies. Established in Manila, leading to the growth of international business presence.  By 1856, Manila hosted 13 foreign consulates, including: two American, seven British, two Swiss, one German, and one French. RISE OF BANKS  Obras Pias o It was the earliest banking institution and operated as a charitable organization under religious supervision. o Received donations from wealthy individuals for pious works and provided loans to businessmen.  Banco Español-Filipino: o Established by Royal Decree of Queen Isabel in 1851. o The first government bank in the Philippines, authorized to issue banknotes, where its current name is the Bank of the Philippine Islands. SIGNIFICANT IMPROVEMENTS OF TRANSPORTATION AND COMMUNICATION  Significant construction of roads and bridges especially during 1830-1840.  Lighthouses were built to aid sea navigation; first lighthouse (farola) constructed at the mouth of the Pasig River in 1846.  Steamships first arrived in Manila Bay in 1848, while steamship line from Manila to Spain service started in 1873.  The Manila-Dagupan Railway was established in 1891.  Tramcar service was introduced in Manila in 1893.  Electric light system first appeared in Manila in 1895.  Monthly mail service was established between Manila and Hong Kong in 1854.  Philippine stamp was first issued in 1854.  Telegraph Line first opened in 1873, while telephone first appeared in Manila in 1890.