Printer Friendly

British Enterprise in Brazil: The St. John d'el Rey Mining Company and the Morro Velho Gold Mine, 1830-1960.

British Enterprise in Brazil: The St. John d'el Rey Mining Company and the Morro Velho Gold Mine, 1830-1960 J. Fred Rippy once estimated that the English invested in close to four hundred mining companies in nineteenth-century Latin America, of which fewer than twenty became profitable. The most lucrative of them all was the Morro Velho property, situated in the interior Brazilian state of Minas Gerais, and acquired by the St. John d'el Rey Company in 1834. As its firm's name suggests, that company began operations at the old mining district of Sao Joao del Rey, but when operations there proved unrewarding it purchased the Morro Velho mine, situated 20 kilometers from the modern state capital of Belo Horizonte. That mine was sited on a remarkably consistent and abundant but not especially high grade lode of gold and silver; it became the nucleus of a property that ultimately extended for a hundred square miles, encompassing a company town, Nova Lima, today an industrial suburb of the state capital, Belo Horizonte, a complex of mineral and woodlands, a hotel, a store, a bakery, and other facilities. Despite serious setbacks--a destructive fire in 1867 and the collapse of the labyrinthian system of tunnels in 1886-and the need to sink shafts to unheard of depths, ultimately to 2,453 meters, the enterprise proved remarkably profitable. Returns on investment between 1842 and 1886 averaged 14 percent and remained respectable (6.8 percent) from 1888 until 1956. Beginning in the mid-1940s, however, a series of costly strikes, unfavorable gold prices, increasing plant obsolescence, and the mounting costs of worker social benefits lessened profitability and contributed to the owners' decision to sell the property in 1958.

Marshall Eakin of Vanderbilt University devoted a decade to reconstructing the history of this remarkably successful firm. His sources include what survives of its London archives (now at the University of Texas, Austin); its local records, which he discovered at Nova Lima; nuggets found in a half-dozen other archives; interviews with former company employees; and an extensive historical and technological literature. The book is divided into eight chapters, the first two of which survey the development of gold mining in Minas before the advent of the company and provide a chronological overview of its operations. The next three chapters analyze the firm's modest involvement in provincial (later state) and national politics, its exceptional engineering achievements, and its persistant labor problems. Until the 1880s the firm depended primarily on the labor of slaves that it owned or rented. Thereafter it recruited, with varying degrees of success, Asiatic, Cornish, German, Italian, and Spanish workers to supplement Brazilian "natives." The remaining chapters trace the development of Nova Lima from its beginnings as a rural village to its emergence as a center of industrial workers. They also assess demographic characteristics of Brazilians as well as the segregated, privileged British elite members of the community in several periods and offer some conclusions and suggestions for future assessments of the role of foreign capital in a Latin American nation.

On the whole Eakin presents a balanced but critical assessment of the firm's achievement. Because of the limitations of his sources, he is able to say far more about the company's gold-producing operations than about its other economic activities. He is critical of the firm's refusal to employ Brazilian graduates of the nearby mining school in supervisory capacities, its dual system of wage payments to "natives" and foreign nationals, and its failure to stimulate collaborative cottage industries, but he fails to note that the company's policies were consistent with those of other leading foreign firms operating in Brazil or elsewhere within Latin America during much of his period.

This is a valuable addition to the literature concerning the role of foreign capital in modern Latin America. The occasionally repetitive text is reinforced with helpful maps, graphs, tables, and illustrations. Eakin's volume belongs on the shelf with older studies by Rippy, Stanley J. Stein, Peter Winn, D. C. M. Platt, Vera Blinn Reber, and others who have taught us much about what British entrepreneurs accomplished, what they failed to achieve, and what they never intended to do in modern Latin America.

Dauril Alden is professor of history at the University of Washington. He is the author of, among other works on Latin American history, Royal Government in Colonial Brazil (1968).
COPYRIGHT 1990 Business History Review
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1990 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Author:Alden, Dauril
Publication:Business History Review
Article Type:Book Review
Date:Jun 22, 1990
Previous Article:The Political Economy of Mexican Oil.
Next Article:Before European Hegemony: The World System, A.D. 1250-1350.

Terms of use | Privacy policy | Copyright © 2018 Farlex, Inc. | Feedback | For webmasters