Liberalising Tobacco in the Philippines During the Nineteenth-Century Late Spanish Colonial Period

The Spanish imperial tobacco monopoly established in the Philippines in 1781 was finally dismantled a century later, over the years 1881–1883, after a period of severe crisis in the 1860s. While the abolition of the monopoly did not lead to significant changes in the location of areas of tobacco processing and cultivation, it did open up manufacturing and trading to large international companies and, alongside these, to small-scale private commercial enterprise. After outlining the reasons for the imposition of the imperial state monopoly and the crisis which led to its dismantling, this chapter charts how the liberalisation of this key sector of the colonial economy opened up a space in both the export and domestic tobacco market whereby, alongside the large companies with Spanish and foreign capital, small business in the hands of local Filipinos and Chinese benefited economically, catering mainly to local markets. The success of the Chinese companies also gave rise to discourses of exclusion in which racial stereotypes brought tensions to the fore.