The first few waves of Spaniards to reach the Northern tip of South America were virtually all looking to get rich quick: more than settling what would become Venezuela, they were out to ransack any mineral wealth they could find there. As it turns out, other than the pearls off the island of Cubagua near Margarita, they mostly came up empty-handed.
By the end of the 16th century, the get-rich-quick style adventurers were giving way to a different kind of colonist. Land was plentiful, and the products of tropical agriculture were beginning to find their market back home.
A miniature local aristocracy of landowners, mindful to copy the customs from back home, grew up in the countryside. With no local peasantry to exploit, this new elite took to enslaving the indigenous people they found. When these began dying in large numbers of European diseases they had no immunity to, they decided to enslave large numbers of Africans and ship them across the ocean instead.
At the apex of this brutally exploitative slave economy was a tiny elite of white Creoles. Often, they descended from the younger siblings of heirs to noble Spanish families. With no prospect of inheriting a title themselves, they set out to create them in the New World. Their descendents, who often had never been to Spain, became especially fanatical partisans of the Spanish monarchy: the ultimate fountainhead of the legitimacy of their claim to superior status.
The first product to really make it big was cocoa: a new, exotic and extremely expensive status symbol in Europe. Nothing screamed wealth and privilege in 17th century Vienna like a cup of hot chocolate, and Venezuela dominated the upstream end of this trade. A handful of criollo families made fortunes rivalling what could be had through gold and silver mining in Peru or Bolivia on the back of this chocolate craze.
Later, other products would join cocoa on the trade routes: coffee, sugar, cotton, indigo dye.
Race mixing was absolutely banned, yet the land in Venezuela struggled to sustain a properly functioning aristocracy. With the exception the Gran Cacao haciendas around the Lake of Valencia basin and the Tuy River valleys, white landowners tended to be a fairly miserable bunch. They even got married with their own family in an effort to not lose their properties. Already by the end of the 18th century Spanish envoys were scandalized by the degree of miscegenation they witnessed.
Yet relations between the upper reaches of the Mantuano elites and the metropolitan government in Madrid began to deteriorate in the 18th century.
In order to organize the new local aristocracy formed by landlords or Grandes Cacaos, King Felipe V in 1728 chartered The Royal Guipuzcoan Company of Caracas. It was granted a monopoly over all trade coming in and out of Venezuela, barring the Captaincy General from trading regionally, and receiving broad powers to fight smuggling.
The Guipuzcoana was a brilliant gambit by Madrid to appropriate the bulk of the rents from the colony’s trade: in effect, it put the royal hand deep into Mantuano pockets. It’s little wonder then that the Colonial elite hated it and took to smuggling with great gusto.
Any number of complaints were sent to the King asking for the elimination of the Guipuzcoana’s monopoly. They provide a fascinating window into the mindset of the elite of the time, and into the mindset that created a boom in smuggling to the tiny, before-largely-unnoticed Dutch colonies of Aruba, Bonaire and Curaçao – a smuggling trade that continues, in one form or another, to this day.
The Royal Guipuzcoan Company of Caracas disappeared in 1785 after a long campaign by local elites against it. The demise of the Guipuzcoana demonstrated the power of the criollo landowners and Creole merchants. From that point on, Venezuela started to trade directly with Nueva España (today México) and the newly independent United States.
The Guipuzcoana was no more, but other irritants soon took its place. A Royal Decree of 1789 stipulated that all slaves more than seventy years of age would be entitled to freedom and their owners were obliged to provide food and shelter. Mantuanos were horrified.
After The Royal Guipuzcoan Company of Caracas disappeared, Creole merchants switched from cocoa to the new fashionable drink in the best European salons: coffee. It made more money in Spain and the rest of Europe. Soon, they had set their sights on staying in charge not of the Capitanía General de Venezuela but of their own state.
Today, we call that process “Independence”.