1509-1550 1821-1903

Colonial Panama, 1550-1821

A.) Panama as a part of Spain's colonial Empire

Panama was of strategic importance, an area of eminent importance during the Spanish conquest of South America. Yet, it was also characterized by a tropical humid climate which proved very unhealthy for the Spaniards. Tropical diseases took the lives of many.
When the administration of the Spanish conquests in America was organized, Panama was at first allocated to the VICEROYALTY OF NEW SPAIN (i.e. Mexico, resp. the Captaincy of Gracias) in 1538. The AUDIENCIA OF PANAMA was established (1538), with jurisdiction over the region between Nicaragua and Cape Horn. In 1543 it was reduced to the present territory of Panama.
Yet, the isthm of Panama was of vital strategic importance to Peru, and it was only logical that the VICEROYALTY OF LIMA (est. 1550) should take responsibility for it's defense. So Panama in 1570 was allocated to Peru (Lima). The Diocesis of Panama was placed under the Archdiocesis of Lima (est. 1546).
The Peruvian gold and silver was shipped along the Pacific coast to Panama, transported across the isthm to NOMBRE DE DIOS and from there shipped by the SILVER FLEET to Spain. In 1573, English captain SIR FRANCIS DRAKE managed to capture the Spanish silver caravan in Panama, headed for Nombre de Dios. In 1598 the silver was rerouted to PORTOBELO (Panama), a harbour which was fortified in order to prevent further raids.
Panama meant a key to the Pacific Ocean. There were other such keys - Cape Horn, a very difficult passage due to storms and high waves, and the route around the Cape of Good hope and the Indian Ocean, very long. Thus, although Panama itself was of little economic importance, it was the main economic artery connecting Spain with it's Andean possessions. Spain held on to the country to prevent this key to fall into another power's hands.

B.) English and Scottish Threat

Jamaica had been occupied by the British in 1655 and became a center of pirate activity, tolerated or even sanctioned by the governor. In 1666 buccaneer HENRY MORGAN took Portobelo; in 1671, Morgan, believing England to be still at war with Spain, crossed the isthm and took the city of Panama. As (without his knowledge) peace had been previously concluded (the TREATY OF MADRID, 1670), Morgan was arrested and sent to London, while Panama was returned to Spain.
Scottish merchants in 1695 founded the Company of Scotland Trading to Africa and the Indies. The company declared the acquisition of DARIEN (Panama) it's primary aim, as it would provide the shortest access to the Pacific Ocean. In 1698 an attempt to settle was made, at a fort called ST. ANDREWS. Many of the settlers died, the others faced famine; many returned, the remainder surrendered to a Spanish force in 1699. The company went bankrupt, and the Darien project was given up.

C.) Panama in the 18th century

In 1718, the Presidencia of Santa Fe de Bogota was elevated into the VICEROYALTY OF SANTA FE DE BOGOTA, of which Panama now formed a remote province.
Panama continued to be exposed to naval attacks, Portobelo being seized by the English in 1739, CHAGRES in 1740, to be restored to Spain in the TREATY OF AIX-LA-CHAPELLE (= Aachen) in 1748.

Library of Congress, Country Studies : Panama

This page is part of World History at KMLA
First posted in 2001, last revised on November 5th 2004

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