If the exports which moved to the coast on British-owned railways initially stoked the engine of Brazilian modernization, the resulting complex of British export–import interests acted as a brake. When the economy began to pulse with its own life and some energies began to turn to industrialization, they found the forces that had given birth to growth now seeking to smother it. The British were directly connected with almost every aspect of this export-oriented system. The grip which the British held upon the railroad, the exporting firm, the import business, the shipping company, the insurance agency, the financial bank, and even the government treasury now tended to choke off any efforts to reduce the reliance on British imports. So did the wide currency of free trade doctrines coined in Britain. The Brazilian minister in London noted as early as 1854 that ‘the commerce between the two countries is carried on with English capital, on English ships, by English companies. The profits, … the interest on capital, … the payments for insurance, the commissions, and the dividends from the business, everything goes into the pockets of Englishmen’.

On the other hand, the very fact that Brazil did begin to industrialize suggests that that grip was not a stranglehold. There were significant areas of productive activity which the British did not dominate, and there were some points at which, as will be made clear in later chapters, they even fostered industrialization. But here emphasis is placed on the way in which they slowed it down by controlling and channeling one current of Brazilian economic life after another.