The ‘Galleon System’ and Chinese Trade in Manila at the Turn of the 16th Century

Abstract

When the mission of the Basque adelantado Miguel López de Legazpi reached Luzon – the northernmost isle of the Philippine archipelago – in 1570, the ambitious Spanish conquistadores met the ‘Sangley’ merchants for the first time. During the 1570s many Chinese junks started to connect Manila with the ports of Fujian province and transformed the Philippine capital in a crossroads of the silk to silver exchange between China, Japan and the two Americas. Following the establishment of the Manila-Acapulco-Callao triangular trade line and with the influx of the precious ‘reals of eight’ from Mexico, the so-called ‘Naos de China’ started to enrich both the Spaniards and the ‘Sangleys’, triggering an irreversible process that led to the establishment of a ‘Galleon System’ in just two decades. This paper will discuss the role of Chinese trade in the Philippines at the close of the 16th century from the founding of Manila in 1571 to the establishment of the ‘Galleon System’ by the early 1590s.