Darien scheme

The Darien Scheme was an unsuccessful attempt by the Kingdom of Scotland to become a world trading nation by establishing a colony called "Caledonia" on the Isthmus of Panama on the Gulf of Darién in the late 1690s. The aim was for the colony to have an overland route that connected the Pacific and Atlantic oceans. From the beginning the undertaking was beset by poor planning and provisioning, divided leadership, lack of demand for trade goods, devastating epidemics of disease, and failure to anticipate the Spanish Empire's military response. It was finally abandoned in March 1700 after a siege by Spanish forces, which also blockaded the harbour.

As the Darien company was backed by 25–50% of all the money circulating in Scotland, its failure left the entire Lowlands almost completely ruined and was an important factor in weakening their resistance to the Act of Union (completed in 1707). The land where the Darien colony was built is virtually uninhabited today.

Origins

The late 17th century was a difficult period for Scotland. The country's economy was relatively small, its range of exports very limited and it was in a weak position in relation to England, its powerful neighbour (with which it was in personal union, but not yet in political union). In an era of economic rivalry in Europe, Scotland was incapable of protecting itself from the effects of English competition and legislation. The kingdom had no reciprocal export trade and its once thriving industries such as shipbuilding were in deep decline; goods that were in demand had to be bought from England for sterling. Moreover, the Navigation Acts further increased economic dependence on England by limiting Scotland's shipping, and the Royal Scots Navy was tiny.