d hitherto
been supplied to them from the Peninsula. The short-sighted policy
of the Spaniards in closing to the Dutch the Portuguese markets,
which were now theirs, brought upon themselves the destruction of
the monopolies which they had gained by the Union. The Dutch were
now free, and their old tyrant's policy induced them to establish
independently their own trading headquarters in the Molucca Islands,
whence they could obtain directly the produce forbidden to them in
the home ports. Hence, from those islands, the ships of a powerful
Netherlands Trading Company sallied forth from time to time to meet
the Spanish galleons from Mexico laden with silver and manufactured
goods. Previous to this, and during the Wars of the Flanders,
Dutch corsairs hovered about the waters of the Moluccas, to take
reprisals from the Spaniards. These encounters frequently took place
at the eastern entrance of the San Bernadino Straits, where the Dutch
were accustomed to heave-to in anticipation of the arrival of their
prizes. In this manner, constantly roving about the Philippine waters,
they enriched themselves at the expense of their detested adversary,
and, in a small degree, avenged themselves of the bloodshed and
oppression which for over sixty years had desolated the Low Countries.

The Philippine Colony lost immense sums in the seizure of its
galleons from Mexico, upon which it almost entirely depended for
subsistence. Being a dependency of New Spain, its whole intercourse
with the civilized world, its supplies of troops and European
manufactured articles, were contingent upon the safe arrival of the
galleons. Also the dollars with which they annually purchased cargoes
from the Chinese for the galleons came from Mexico. Consequently,
the Dutch usually took the aggressive in these sea-battles, although
they were not always victorious. When there were no ships to meet,
they bombarded the ports where others were being built. The Spaniards,
on their part, from time to time fitted out vessels to run down to
the Molucca Islands to attack the enemy in his own waters.

During the Governorship of Gomez Perez Dasmarinas (1590-93), the
native King of Siao Island--one of the Molucca group--came to Manila
to offer homage and vassalage to the representative of the King of
Spain and Portugal, in return for protection against the incursions
of the Dutch and the raids of the Ternate natives. Dasmarinas received
him and the Spanish priests who acco