Colonial Brazil - The Gold Cycle (18th Century)

The Gold Cycle (18th Century)

The discovery of gold was met with great enthusiasm by Portugal, which had an economy in disarray following years of wars against Spain and the Netherlands. A gold rush quickly ensued, with people from other parts of the colony and Portugal flooding the region in the first half of the 18th century. The large portion of the Brazilian inland where gold was extracted became known as the Minas Gerais (General Mines). Gold mining in this area became the main economic activity of colonial Brazil during the 18th century. In Portugal, the gold was mainly used to pay for industrialized goods (textiles, weapons) obtained from countries like England and, especially during the reign of King John V, to build magnificent Baroque monuments like the Convent of Mafra. Apart from gold, diamond deposits were also found in 1729 around the village of Tijuco, now Diamantina.

In the hilly landscape of Minas Gerais, gold was present in alluvial deposits around streams and was extracted using pans and other similar instruments that required little technology. Gold extraction was mostly done by slaves. The Portuguese Crown allowed particulars to extract the gold, requiring a fifth (20%) of the gold (the quinto) to be sent to the colonial government as tribute. To prevent smuggling and extract the quinto, in 1725 the government ordered all gold to be cast into bars in the Casas de Fundição (Casting Houses), and sent armies to the region to prevent disturbances and oversee the mining process. The Royal tribute was very unpopular in Minas Gerais, and gold was frequently hidden from colonial authorities. Eventually, the quinto contributed to rebellious movements like the Levante de Vila Rica, in 1720, and the Inconfidência Mineira, in 1789 (see below).

The large number of adventurers coming to the Minas Gerais led to the foundation of several villages, the first of which were created in 1711: Vila Rica de Ouro Preto, Sabará and Mariana, followed by São João Del Rei (1713), Serro, Caeté (1714), Pitangui (1715) and São José do Rio das Mortes (1717, now Tiradentes). In contrast to other regions of colonial Brazil, people coming to Minas Gerais settled mostly in villages instead of the countryside.

In 1763, the capital of colonial Brazil was transferred from Salvador to Rio de Janeiro, which was located closer to the mining region and provided a harbor to ship the gold to Europe.

According to the historian Leslie Bethell, "In 1700 Portugal had a population of about two million people. During the eighteenth century approximately 400,000 left for Brazil, despite efforts by the crown to place severe restrictions on emigration."

Gold production declined towards the end of the 18th century, beginning a period of relative stagnation of the Brazilian hinterland.