Mercantilism and the Navigation Acts
Before the mid 17th Century, the colonies received no financial or military aid from
England. However, in 1660, King Charles II (of England) believed the colonies should be
under tighter British control and sought to make some changes.
I. Colonial System of Trade
English merchants/Parliament want to exclude foreign rivals (Dutch/French/German) and
profit from the Colonies.
Mercantilism-England believes that the colonies exist for the benefit of England
(Expand England’s Power).
I. England wants to set up a “Favorable balance of Trade” with the colonies.
a. Will export more goods to colonies
b. Will import less
**Colonies benefit England in 2 ways—Mercantilism
 Raw Materials (From natural resources)
 Guaranteed market for manufactured goods
II. Navigation Acts (1660-1673)- Restrictions placed on Colonies by British in order
to Increase Profit and Eliminate trade with other foreign markets.
*The Navigation Acts consisted of 4 points:
I) No ship could trade in colonies unless built in Americas or England. In addition, at
least 75% of the ship’s crew must be English citizens or colonists.
2) Tobacco, Indigo, & other valuable goods were to be sent directly to England or sold to
English Colonies (Colonies can’t sell products directly to other countries. Had to go
through England).
* American shippers pay “customs duty” or trade tax when goods arrive in
England.
* English make $$ on trade.
* Guarantees American markets with English
3) Any imports to American colonies must first go through England (Colonies can’t do
direct business (trade) with other countries).
* Products that are imported become very expensive, England makes $$.
4) Prohibited colonies from manufacturing certain goods from their own natural
resources.
* Eliminated competition from colonists trying to make their own goods instead
of trade and deal with England (Another way to guarantee market).
* Colonists will have to buy products from England instead of making and
selling them locally. Eliminates competition between colonies and England. England
profits ($$).