British Investments in Brazil: Edward Ashworth, a case study

Abstract

This is a case study of a textile company located in Brazil, Companhia Taubaté Industrial (CTI), during the period of 1899-930. During this period British investors were expressive under the direction of the traditional British counting and investment company Edward Ashworth & Co. that had a branch in Brazil dating back to 1840s. Methods’ theoretical approach adopted in this study is based on Hirschmann’s linkage effects and the Myrdal’s principle of circular causation. The article analyses the Brazilian economy conditions related to the economic growth determined by the expansion of raw material export. For instance, the effect of coffee exports income as a forward factor to the internal industrialization through the process of imports replacement. The emergence of the company, in 1891, and its management in the first years of activity, until British capital effectively entered in the Brazilian market in 1899, was quite poor. This scenario was followed by a development cycle fully influenced by the increase in internal consumption and by the local cloth production, which used to be imported before. The industrial expansion was successful until 1930, when the British capital vanished because of the 1929 crisis. This crisis took Edward Ashworth Company headquarters in Britain to bankruptcy. Along this article, the influence of British shareholders in the CTI company business and the observations made about the company by Richard Graham are analyzed. Conclusions include that the British investments were crucial to the viability of the CTI company.