On Rue Sursuq (Sursock) in the Achrafiyya district of present-day Beirut sits the palatial townhouse and garden of the well-known Sursuq family. Today, the Sursuq palace is a museum, a tourist attraction, and a popular venue for weddings and elite gatherings. It is also home to Yvonne Sursuq Cochran, heiress to what remains of the Sursuq family fortune. On the same Rue Sursuq stands the Bustrus palace, now the Ministry of Foreign Affairs and Emigrants. Rue Selim de Bustrus and a side street named after the family's oldest living member, Michel de Bustrus, are nearby. From the mid-nineteenth to the early twentieth century, these Greek Orthodox families, along with the Tueinis, Khuris, Debbases, Trads, Tabets, Naggiars, and Farahs, comprised the wealthiest business community in the Levant.
Across the Mediterranean, on 31 Brook Street, Grosvenor Square in London, a storefront still stands on the site of what was once the Sursuq family's first European office, established in 1858. The Bustrus family occupied another building nearby. When not conducting business in Beirut, Alexandria, Istanbul, Adana, Mersin, Paris, or Marseille, family members used their London offices for business dealings in global commerce, trade, and social visits. They discussed their investments in Ottoman land markets, sent and received bills of lading, negotiated their roles as creditors in European, Ottoman, and Levantine banks, purchased majority shares in major European cotton and transport companies, and strategized corporate litigation presided over by British judges and Beirut's Islamic (shari‘a) and commercial courts. Unlike ethnic-based networks, like those of the Greek Phanariots and the New Julfa Armenians, whose members participated in long-distance trade in the early-modern period, the Beiruti companies grew up as part and parcel of the new nineteenth-century capitalist economic order. Their goal was capital accumulation.Footnote 1 The size of the Levantine families' trans-Mediterranean networks, the breadth of their portfolios in the Levant and Western Europe, and the formidableness of their competition with British companies put the Levantine business community alongside Ritu Birla's Marwaris and Greek and Jewish networks in the Black Sea and the Mediterranean as integral to the history of nineteenth-century capitalism.Footnote 2
Despite new literature challenging earlier views of East-West economic divergences, modern capitalism—free wage labor, production for the market, private ownership over means of production, and the extraction of surplus value for the purpose of capital accumulation—continues to be synonymous with rapid European industrialization led by the British and Dutch and exported abroad.Footnote 3 Culturalist accounts comprehend revolutionary change through an invidious comparison: Modern capitalism was a product of the absolute advantages of European traditions, values, and institutions over flawed Eastern ones. Perhaps the most flagrant example of this is David Landes's The Wealth and Poverty of Nations, which argues that the Judeo-Christian tradition was responsible for the success of Western modernity by establishing cultural norms of private property ownership and limiting the despotism of the Western state and church.Footnote 4 Joel Mokyr's most recent book is a testament to the persistence of the culturalist narrative in British history.Footnote 5 Moreover, New Institutional Systems paradigms, formulated as foils to Orientalist tropes, end up propagating neo-culturalism. Timur Kuran's The Great Divergence, for instance, contends that Islam—institutionalized in the form of rigid Islamic Hanifi law as applied by the Ottoman state—obstructed capital accumulation in the Ottoman Empire.Footnote 6 Scholars of Middle East studies have posed frequent and biting critiques of these Orientalist and neo-Orientalist models,Footnote 7 yet many scholars continue to characterize nineteenth-century Ottoman forms of labor control for production as backward, feudalistic, or precapitalist holdovers distinct from or at odds with nineteenth-century European capitalism.Footnote 8
Marx was wrong to consider capitalism fully matured in England by the nineteenth century, but he was cognizant of the fact that capitalist development during this period depended on a host of so-called “precapitalist” elements.Footnote 9 Capital accumulation in the nineteenth century relied on free and unfree labor and the subordination and appropriation of “women, nature, and colonies.”Footnote 10 I argue here that the story of Levantine joint-stock companies and their trans-Mediterranean Greek-Orthodox partnerships helps us to rethink narrow culturalist theories of capitalism and paradigms resting on precapitalist/capitalist distinctions.Footnote 11 I draw on the unexplored archive of the Levantine family companies—account records, private letters, court reports, legal correspondences, land records, and business contracts, in Arabic, Ottoman Turkish, and French—to show how these companies accumulated considerable capital by freely borrowing from Europe when beneficial, but largely remaining grounded in the Ottoman social formation. It was in fact the flexibility of these Levantine family firms that made them fierce competitors and likely partners for European capitalists. Through their engagement with multi-regional firms and global and European markets, the Levantine joint-stock companies contributed to the shape and expansion of modern capitalist activity in the second half of the nineteenth century.
THE LEVANTINE JOINT-STOCK COMPANY AND CAPITAL ACCUMULATION IN THE OTTOMAN SOCIAL FORMATION
At the beginning of the nineteenth century, the Sursuq, Bustrus, Tueini, Khuri, Debbas, Trad, Tabet, Naggiar, Farah, and other Levantine business families began acquiring wealth at a rapid pace. Originally becoming rich as local tax farmers, moneylenders, and owners of small silk factories, the Sursuqs migrated to Beirut in the early eighteenth century from the district of Barbara, and before that Jubayl (Byblos).Footnote 12 The Bustrus family settled near Beirut from Cyprus at the end of the seventeenth century.Footnote 13 By 1832, many of these families had established small businesses in the city of Beirut. Just after the start of the civil war between the Maronites and Druze in 1860, other Greek-Orthodox families joined the Beiruti community.Footnote 14 The families who settled in the streets of the Achrafiyya district watched their fortunes grow as global silk prices began to increase exponentially in the 1850s and 1860s. In the early 1860s, when the silk market was at its peak, the Levantine firms built new silk factories to meet European demand, taking the number of Levantine-company-owned factories from thirty-seven in 1862 to forty-seven in 1867, compared to ten or eleven European-owned ones.Footnote 15
The families were not yet millionaires or owners of ornate palaces; their early investments in silk buttressed the formation of their own businesses and business partnerships, as they engaged in the accumulation of capital in conjunction with the renewed acceleration of Mediterranean trade. Dimitri (Mitri) Sursuq was the founder of the family firm Niqula Sursock et Frères, which he named after his first-born son. Niqula and his six brothers and half-brothers—Musa, Lutfallah, Khalil, Nakhlé (Michel), Yusuf (Joseph), and Ibrahim—worked to grow the business into a major house for trade and investment. Antun Bustrus, like Dimitri, established the family company, Bustrus and Sons, which became Musa Bustrus and Nephews in the mid-nineteenth century after the premature death of Musa's three older brothers, George, Bustros, and Joseph.Footnote 16 Different branches of the Debbas family formed the joint-stock companies G. S. Debbas and K. Debbas and Company (the latter run by Khalil). George Tueini formed George Tueni and Co., Ibrahim Tabet established his own firm Tabet and Company, while the members of the Naggiar family formed the prestigious Naggiar & Co.Footnote 17
As predominantly Christian companies, the Levantine firms exploited their European cultural connections to become competitive on the global market. They became dragomans for local consular offices and members of European Chambers of Commerce, which gave them access to potential European business partners.Footnote 18 To be sure, the Levantine families' Christian status gave them an advantage in global business circles, but it did not lead them to mimic Western capitalist models, as contemporary Europeans observed and scholars of Europe and the Middle East maintain.Footnote 19 Indeed, Levantine joint-stock companies in the Ottoman Empire emerged as part of a larger movement of joint-stock business organization in the nineteenth-century Mediterranean. Some new joint-stock firms were Muslim, even in the heavily Christian city of Beirut.Footnote 20 The sultan, for instance, granted a concession for the steam tramway between Beirut and Damascus in 1891 to the Sunni Muslim family company of Hasan Beyhum.Footnote 21 Beyhum's firm, later run by his son Omar, worked closely with the Greek-Orthodox and Maronite business communities in matters of agricultural land in Palestine.Footnote 22 The Beyhum family partnered with the Sursuqs to create the Syreo-Ottoman Agricultural Company Ltd., “a joint-stock company with limited liability shares.”Footnote 23 Outside of Beirut, Muslim joint-stock companies emerged alongside Levantine ones. The predominately Muslim marine transport company Şirket-i Hayriye established its offices in Istanbul in 1851 and divided its assets into two thousand tradable shares, with Sultan Abdülhamid as the primary shareholder.Footnote 24
Both Christian and Muslim companies consolidated their family firms by working within the mechanisms of the shari‘a courts.Footnote 25 While Islamic-based laws of inheritance tended toward divisions of shares of investments, family members continued to hold their investments collectively through private legal contracts drawn up by company lawyers and approved by the shari‘a courts. The profits from Niqula Sursuq et Frères, for example, were divided among the seven sons of Dimitri Sursuq, but kept under the company umbrella. The other shares went to members of the extended family by marriage. Dimitri's third son, Lutfallah, married Zarife Bustrus; his other sons married members of the Debbas, Khoury, and Trad families. Niqula's first-born daughter was wed to Khalil Debbas (of K. Debbas & Co.); his second daughter married George Tueini (of George Tueini and Co.). The Sursuq sons and daughters had little choice when it came to their own betrothals; marriages served to keep their quickly accumulating wealth—particularly land revenues, credit exchanges, and growing assets from trade brokerage—within a small group of families of Greek Orthodox and Maronite origin. At the turn of the century the company had well over one hundred kin-related shareholders.Footnote 26
Betrothals, supported by specific understandings of gender roles in the families, laid the foundation for the Levantine joint-stock companies. But the firms' specific character grew out of the Ottoman social formation, specifically the companies' participation in the Ottoman enterprises of tax farming, silk farming, and moneylending (later, banking). The Sursuq, Bustrus, Debbas, Khuri, Farah, Tabet, Naggiar, and Tueini companies began to take shape through the families' joint shareholdings in the agricultural hinterlands of burgeoning ports on the Eastern Mediterranean coast. In the 1860s, Niqula Sursuq et Frères began to increase their control over land by extending credit to peasants through local agents. The companies hired local merchants to act as their overseers in the hinterlands of Jaffa and Mersin-Adana. In the case of Jaffa, for seven months a year the Levantine firms directed overseers to protect their investments by observing growing seasons in the fertile plains. In exchange for credit to peasants for seeds, tools, irrigation repairs, and so forth, the companies received repayments in kind, taking anywhere from one-fifth to the entirety of the total season's crop.Footnote 27 Soon, these companies had large warehouses in the region of Jaffa's port for the storage of exports, which a steamer collected at least twice a week on its way to Manchester, Hull, London, and Marseille.Footnote 28
From the early 1850s, the Levantine companies began to vertically integrate their businesses by increasing their control over agricultural production and distribution in the fertile hinterlands of Jaffa, Mersin-Adana, Beirut, Haifa, Acre, and Alexandria. Some of the first lands that they purchased were in Mersin-Adana. In the 1850s, Aziz Sursuq, a member of a branch of the Sursuq family living in the Mersin-Adana district, attained title deeds for the fertile Upper Plains regions of Mersin together with Nejib Tueini and Selim Bustrus.Footnote 29 In 1866, the Ottoman government formed Emlak Commissions (Property Commissions) to register all miri (state-owned) land in the province. These surveys commenced in the region of the Jezreel Valley (Marj ibn ‘Amr) in 1869. At the very start of the state's application of the land survey, before claims to the land could come forward, representatives of the Levantine companies—Niqula Sursuq, Habib Bustrus, Gebran Tueini, and Mata Farah—went to the wali of Syria Muhammad Rashid Pasha and bribed him with 3,000 Ottoman lira to help them convince the state to grant the companies title deeds for 240,000 dunams (about 60,000 acres) of land in the Jezreel Valley and outside of Nazareth.Footnote 30
By the mid-1880s, the Levantine business community controlled the most fertile land in Greater Syria and Palestine and valuable plots in Egypt. From the 1870s onward, the companies purchased title deeds from peasant inhabitants, whose families felt the real effects of declining global prices for their products during the great depression (1873–1896) and harsh climatic conditions.Footnote 31 After this push for land ownership, the Beirut-based families controlled approximately 800,000 dunams (nearly 200,000 acres) of prime agricultural land in Palestine, including the most coveted villages of the Jezreel Valley (Marj ibn ‘Amr). The shari‘a court records from Jenin, Haifa, Hebron, Jerusalem, Nablus, and Jaffa, in particular, illustrate that Islamic jurists in these regions ruled in favor of the Levantine companies' purchases of land for debts and legally condoned the families' consolidation and commodification of land.Footnote 32 In addition, the families held majority shares in seven villages in the Mount Lebanon region: Jdayel, Chikhan, Garzouz, Mounsef, Bekhaz, Barbara, and Rihan,Footnote 33 and they possessed shares in much of the fertile land in Adana-Mersin. In the 1860s, in exchange for the families' backing for the reign of Khedive Ismail in Egypt, their companies were also granted “huge cotton plantations” on some of the most fertile land outside of Alexandria.Footnote 34
How did the Levantine companies hold their agricultural companies as joint-shareholders? In the Ottoman tapu system, a village was comprised of 24 qirats (or parts of a whole). For the Levantine companies, these qirats translated into shares of the agricultural surplus. Once the shares were distributed, bought, and sold among family members, each family company possessed a defined share in the net profit or losses of a given village at the end of each calendar year, represented by the companies' shares minus the tax they paid to the government (in Palestine, this tax was called the werko). The families and the Ottoman registry would often multiply their original number of qirats (or partial qirats) to not have to deal with too many fractions of a share. This type of shareholding led branches of family companies to assert, for example, that they owned 1/6th of the 135 qirats that the companies owned in the villages of Dalieh and Umm al-Dafouk, which was then further partitioned into shares for the companies' individual members.Footnote 35 Most of the family companies then added value to those shares by renting out part or all their shares in a village to individuals or companies whom they called “guarantors” (Arabic daman).Footnote 36 The guarantors paid a fixed sum per year in exchange for one-half of the net profit for those shares in the agricultural surplus.Footnote 37 In other words, the renters were simply guaranteeing shares by assuming the bulk of the risk. Some renters took a more hands-on approach,Footnote 38 but most “guarantors” visited the land only to oversee the divisions of the seasonal harvest when it hit the threshing floor.Footnote 39
The Levantine families' choice to rely on Ottoman institutions was neither accidental nor simply a “precapitalist” holdover. Educated in Greek and French schools, the leaders of the Beirut-based firms were aware of European-style forms of absolute private property ownership, but until these leaders sold the land to European companies and settler-colonial groups they rarely chose to hold their land as private property in the Europe sense.Footnote 40 Where labor was inexpensive and plentiful, like in parts of Egypt, the firms held land in a manner akin to absolute private ownership.Footnote 41 In most regions of the Levant, though, the companies' members relied on the Ottoman system of collective sharecropping (musha‘a) in the villages they purchased in Palestine; this was for them simply the most effective mode of capital accumulation. Labor was scarce in the Levant and therefore expensive.Footnote 42 British companies learned this hard lesson in 1868 when they were forced to relinquish as much as one-third of their newly purchased agricultural land in the hinterlands of Izmir (Smyrna). Attempting to hold it as private property, they could not find enough labor to work it.Footnote 43 Through Ottoman tax farming structures whereby the landholder took a percentage of the surplus yield the Levantine family firms amassed agricultural products for export to European ports. The Beirut-based companies could then import the labor that they needed to supplement labor from sharecroppers. In the case of their properties in Mersin-Adana, for instance, the firms imported as many as fifty to seventy thousand workers every summer to help to harvest the grain and an additional twelve to fifteen thousand to harvest and clean the cotton.Footnote 44
THE BIRTH OF THE BRITISH JOINT-STOCK COMPANY
The Levantine joint-stock companies, indeed, grew out of the Ottoman social formation and a conscious rejection of European models that were unsuitable for capital accumulation in the Levant. Moreover, as Paddy Ireland has noted, English joint-stock companies were still maturing and not yet readily available as forms to imitate. Across the Mediterranean on English shores, the development of the British limited liability company as a dominant institution of capital accumulation was in fact not inevitable in the mid-nineteenth century. While the East India Company is a notable exception, during the years 1720 to 1844, royally or parliamentary sanctioned joint-stock ventures in Britain were rare. The Bubble Act of 1720 deterred the legal promotion of incorporated joint-stock companies in most sectors by prohibiting the transfer of shares in a company, and limited liability without state sanction.Footnote 45 Most joint-stock companies in the eighteenth and early nineteenth centuries had no corporate legal status granted to them by the state. Only through “the ingenuity of corporate trust lawyers [did they create] a legal form reasonably suited to them through skillful use of deeds of settlement.”Footnote 46 Deeds of settlement permitted companies' investors to form joint-stock partnerships and designate the owners of the companies as joint trustees without parliamentary act or royal charter.
Throughout eighteenth- and early nineteenth-century England, the primary form of commercial organization was decidedly the unincorporated joint-stock company, or private partnership. And even in the case of the incorporated company, its distinction from the unincorporated one was extant but small. “[At this time,] shares in joint stock companies, [both] incorporated and unincorporated, were consistently conceptualized as equitable interests in the assets of the company. Shareholders were regarded as owners in equity of the company's property and shares as an equitable right to an undivided part of the company's assets.”Footnote 47 The incorporated joint-stock company came about in England after parliament passed the 1844 and 1856 Joint Stock Companies Acts and the Companies Act of 1862. But what did it mean for a company to be legally incorporated? Traditionally, scholars have been quick to interpret formal incorporation by the state as an absolute uncoupling of the object company from its owner-members; they have contrasted the incorporated company with the family firm, for instance, finding the latter to be unstable, antithetical to capitalism, and unmodern.Footnote 48 However, in social practice, as Ireland demonstrates, the simple “act of incorporation [actually] did not effect a complete separation of company and its members” during this period.Footnote 49 Nor did it arise in opposition to the family firm.
Beginning in the late 1870s, literary and propaganda texts such as Laurence Oliphant's “An Autobiography of a Joint-Stock Company” began to connote the joint-stock company's acquisition of aspects of limited liability and public personhood.Footnote 50 In the areas of transportation, companies became registered at a rapid pace and some received protections from the law as well as harsh critiques from the public.Footnote 51 Still, for much of the nineteenth century, Britain maintained the status quo. Contemporary accounts continued to approach the company as a collection of associated individuals and not as an object separated from them. Nathaniel Lindley's 1878 book A Treatise on the Law of Partnership, for instance, describes company law as a “mere statutory development” of the law of unincorporated partnership.Footnote 52 Articles in the British Controversialist rigorously debated, “Is Limited Liability in Public Companies Productive or More Harm than Good?”Footnote 53 And works of fiction, like Gaskell's Crawford, regarded the incorporated company as immortal and corrupt, a way to permit society's crooks to take reckless risks without consequence.Footnote 54 Records of companies during the late nineteenth century show that, aside from the woolen textile industry, most English manufacturing companies between 1830 and 1914 chose not to register their businesses.Footnote 55 Unincorporated “small-to-middling business remained the most characteristic form of enterprise, even in the ‘leading sectors,’” and their leadership was often tied to informal family bonds, and, if they were really lucky, the royal dynasty.Footnote 56
Hence, different normative understandings of the unincorporated partnership remained in the practice of British courts well into the late nineteenth century. In the decades following the enactment of the Companies Acts, judges continued to employ the “laws of partnership,” finding individual shareholders responsible for the debts to the company in times of failure. Only at the century's turn did the notion of “corporate personhood” begin to permeate the corners of English courtrooms.Footnote 57 In the final decades of the century the “corporation as legal person” began to crystalize into a legal category in its own right. Even then, the designation was malleable, with the meaning negotiated and the company itself not hostile to the family firm. Only at the start of World War I were high numbers of private companies registered under the British Companies Acts and denoted as having the legal form of incorporated association separated from their individual members.Footnote 58
THE PLURALITY OF CAPITALIST INSTITUTIONS AND THE GREEK-ORTHODOX CONNECTION IN BRITAIN
As Levantine companies were beginning to vertically integrate their businesses in the mid-nineteenth century, the Levantine business community drew upon the established networks of their Greek-Orthodox Christian co-religionists who owned medium-sized trading and shipping companies in Britain.Footnote 59 Some of these Greek-Orthodox companies chose to incorporate their business under British company law, and some did not. Their decision often had to do with the distinct circumstances of the business. In the case of the Greek-Orthodox joint-stock companies, any decision to incorporate had to consider competition within their political, social, and cultural milieus. The model of the Levantine joint-stock company and some of their Greek-Orthodox partner companies in Britain served the purpose of accumulating capital and protecting their assets. Furthermore, the very character of their unincorporated joint-stock family companies put these firms at a distinct advantage in Eastern Mediterranean trade and in British litigation around it.
One of the Levantine companies' earliest relationships was with the London firm Lascaridi & Co., created under the direction of George Peter (G. P.) Lascaridi. Through this firm, the brothers acted as merchants, insurance and discount agents, dealers, and chapmen.Footnote 60 In addition to their many local and global business pursuits, members of the Lascaridi family invested in the purchase and operation of steamers between London and the Levant and other regions of Europe and the Ottoman Empire, establishing the Greek and Oriental Steam Navigation Company in 1857 with Stefanos Th. Xenos as managing partner.Footnote 61 The Lascaridis had first chartered big steamers to carry imports and exports from their associated merchant houses; the Beyrout and the Aleppo were two of the largest and most profitable.Footnote 62 With Stefanos, they began to purchase ships in large numbers.Footnote 63 These boats, of all sizes and types, carried much of the approximately 7,000 tons per month of export trade to Levantine coastal ports at this time, in addition to their trade with Istanbul and the Black Sea region.Footnote 64 They also carried raw materials, including cotton and grains from Levantine ports and iron and copper, to places like Istanbul.Footnote 65
Stefanos Th. Xenos had the opportunity to incorporate the Greek and Oriental Steam Navigation Company but chose not to. He reasoned that if he made the company public, he would have to approach his fellow Greek businessmen in Britain for their investments. These businessmen happened to be major shippers and mainly engaged in the practice of chartering ships.Footnote 66 If he went to them, he would run the risk of creating potential competitors out of potential shareholder-owners. Xenos reasoned,
I shall be obliged … to show them my profits. I shall open their eyes; and the result will be that, being exporters and importers themselves on a large scale, having all the means, they will try the business and will go themselves into shipowning—as already Messrs. Spartali and Co. have begun at Liverpool—the Greeks unfortunately following each other in a transaction; so, in a couple of years, every two or three houses will have three or four steamers … everyone would have to work for 5 per cent. instead of 40 or 50 per cent.; so as long as I can keep alive the Greek and Oriental, I must keep in darkness those people from whom I fear a true and ruinous competition.Footnote 67
For Xenos, incorporating the Greek and Oriental would mean exposing the company's record books to many potential Greek investors in competitive industries. The consequence could be that they would use the Greek and Oriental Steam as a model to emulate rather than a company to invest in. What is more, the newly incorporated company would have to have a board of directors, whose members, Xenos feared, might not make timely agreements about cargo shipments. Consequently, “The steamer will remain at Constantinople, waiting telegraphic orders, till the board meets and decides—perhaps twelve or fifteen days.”Footnote 68 This was antithetical to his business model that relied on quick transfers of bills of lading and sales by telegraph to the most favorable markets.Footnote 69
Xenos's trepidations were well-founded; according to the journalists of the British Trade Journal and Export World at the time, proponents of incorporation did not have the statistical evidence to make a claim for its advantage: from the 23,140 joint-stock companies newly incorporated through formal registration in England, “From 1862 to 1884 as many as 14,302 companies, with a nominal capital of £2,243,000,000, disappeared altogether.”Footnote 70 Even though Xenos wondered if limited liability would have brought more profit, he cites the example of absentees and disputes within the board of the failed Anglo-Greek Steam Navigation and Trading Company Ltd. in 1866 as an example of an incorporated company folding for just this reason.Footnote 71 Incorporation was plainly neither a panacea for commercial capitalists' success nor an aspiration for all budding capitalists in Britain or globally.
Not only was the British limited liability company not a widespread form to be mimicked in the mid-nineteenth century, but London court cases reveal that the distinct character of the unincorporated Levantine family firm was oftentimes just as successful, if not more successful, than the incorporated company in avoiding individual risk in British courtrooms. In the 1860s, the Sursuq family entered a partnership with The European Bank, Limited. In 1868, the bank issued a bill of complaint to the High Court of Chancery against N. Sursuq and Brothers (a.k.a. Niqula Sursuq et Frères) for 20,000 francs that the Sursuqs had failed to deliver on behalf of their partner Nichoaides Trad & Co.Footnote 72 When the court summoned Niqula Sursuq to appear in court, the only Sursuq the high court could find in London was his twenty-year-old son Iskander (Alexandre). At the time, Iskander was beginning to learn the business of running his father's joint-stock company, and he certainly was a member of the company as a junior partner and a recipient of future shares.Footnote 73 Yet, when asked about the company's debts, he claimed, “I am not and never have been a member of the firm of N. Sursock and Brothers in the Bill of Complaint mentioned.… I have not and never had any interest in the said firm.”Footnote 74 This was not necessarily outright perjury; given the nebulous nature of the network of family firms in the Levant, Iskander could simultaneously be part of all or none of the family business. In this case and others, the flexibility of the unincorporated joint-stock company rooted in Ottoman structures made it difficult for the British courts to identify who was responsible for owed payments and thus whom to prosecute.Footnote 75
GREEK-ORTHODOX PARTNERSHIPS AND THE EXPANSION OF EASTERN MEDITERRANEAN TRADE
Already in the mid-nineteenth century, the Levantine families had begun to solidify their positions in trade between the Levant and Britain and demonstrate to European companies that they had the power to compete in and disrupt European markets. Europeans remarked that the Levantine merchants, with the Beiruti families at the center, were the “chief merchants of Egypt” and Greater Syria and highly engaged in commerce with Europe.Footnote 76 The agents at the Royal and Sun Insurance Alliance Group made bids to insure the families' Beirut warehouses for grains, cotton, metals, and textiles for millions of pounds.Footnote 77 In the city, the German Consul General to Beirut (1873–1877) Julius Zwiedinek Von Südenhorst observed that by the early 1870s, “most cotton merchant houses in Acre and Lattakia [were] branches of [these] Beirut houses.”Footnote 78 This was also true for Mersin.Footnote 79 By the late nineteenth century, business publications in Britain bemoaned that the Levantine companies were capturing a large percentage of the trade market. The Daily News, for example, reported: “One sees how the Eastern element is being swamped by the Western, or by the Christian Syrian element that is so rapidly absorbing the Western spirit, and even beating the West on its own commercial ground.”Footnote 80 The Daily News and other major publications in Britain and France misperceived the Levantine companies' success as due to these businessmen “adopting the Western Spirit” and mimicking the ways of “Western capitalism.”Footnote 81
In 1854, the Sursuqs entered a joint-stock partnership with Lascaridi & Co. Several Beiruti- and London-based shareholders invested in the company: the Lascaridi brothers, George Tueini, Edward Morris (the clerk), and G. P. Lascaridi's long-time Greek-Orthodox partner and financial backer J. Fachri and Company.Footnote 82 A few years later, the Bustruses became partners with the established firm Spartali & Co. As two of the few Greek-Orthodox companies that owned ships at that time, Lascaridi & Co. and Spartali & Co. carried out most of their early transactions in silk, sugar, iron, and other metals between London, Liverpool, and Marseilles and the port cities of Beirut, Alexandria, Mersin, and Jaffa, in addition to Black Sea ports.Footnote 83 Sometime in the mid-nineteenth century they switched almost entirely to cotton and cotton manufactures, such as t-cloth and inexpensive textiles from Manchester factories.Footnote 84 The partners of Lascaridi & Co. and Spartali & Co. also invested in the larger conglomerate Lascaridi & Spartali.Footnote 85
Some Greek-Orthodox and Levantine companies' members sought British naturalization papers so as to remain in residence in London and work in their branch offices. Indeed, the Beirutis operated in the global market by drawing from the multiple identities available to them—Ottoman, Beiruti, Christian, Levantine, Arab, Greek—for the sake of their political standing, residency, or litigation, and business interests.Footnote 86 In the mid-nineteenth century, the British and other governments granted naturalization papers to families like the Sursuqs, Bustruses, Lascaridis, and Spartalis.Footnote 87 Members of the Lascaridi family became naturalized citizens of the United Kingdom in 1855 after a mere twelve-month residency in England; members of the Bustrus firm received naturalization papers from the British government in the 1870s.Footnote 88 While Selim Bustrus and Constantine Lascaridi were legally British, the Bustruses had been born in Greater Syria and resided in Beirut. Likewise, the Lascaridis were an Ottoman Greek-Orthodox merchant family from the small town of Broussa in the major commercial province of Bursa.Footnote 89
The individual families in the Greek-Orthodox partnerships shared robust economic, cultural, and social bonds with the Levantine business community. At least some members of the Lascaridi family owned townhouses and villas close to the palaces of the Sursuqs, Bustruses, and other Levantine families in Beirut's Achrafiyya district.Footnote 90 At that time, the youngest generation of Greek boys from the Lascaridi and Spartali families attended secondary school in Aix en Provence along with the youngest Sursuqs and other Greek Orthodox sons from Beirut.Footnote 91 In Lebanon, Greek primary institutions educated the boys in the Greek language as well as Turkish, Arabic, French, and English.Footnote 92 Stephanos Xenos published a newspaper in Greek in which the majority of articles urged the Greek community to support their community steamers in England.Footnote 93 Moreover, the church served as a place of congregation as well as a place to build economic relationships and conduct business deals, particularly after the migration of Christians from Mount Lebanon after 1860. From 1862 to 1876, the Levantine businessmen with ties to Liverpool, Marseille, Paris, Hamburg, and other important commercial ports populated the Majlis al-milla, the council of Beirut's Greek Orthodox community.Footnote 94
The solidification of the shared community of Greek-Orthodox families in Beirut buttressed partnerships between joint-stock companies in the Levant and the major Greek-Orthodox trading houses in Europe. George Peter, from the Lascaridi family, entered into various private ventures, both as a partner of Lascaridi & Co. and as an individual. In the years that Lascaridi & Co. operated out of London, some of its members invested in the purchase of their own shares in this co-partnership outside of their family company. The Sursuq family also contributed individual shares: For this business venture, Niqula Sursuq partnered with the Italian family of Fratelli, also a resident of the Achrafiyya district; Niqula's half-brother, Yussef Sursuq, made his own investment in the trading company, partnering up with George Tueini to form G. Tueini, J. Sursock and Co.Footnote 95 These shareholders' main clients were from their own families. In other words, the shareholders of N. Sursuq et Frères profited from the revenues that Niqula brought in as an intermediary agent/partner in Lascaridi & Co. In addition, by doing business with George Tueini as well as Niqula's other half-brother Ibrahim and his son Ilyas, and members of the Debbas family firm—G. S. Debbas and K. Debbas and Brothers—the Sursuqs profited as shareholders in the brokerage and sale of the products they sold.Footnote 96
The trust and familiarity within the Greek-Orthodox community was based on familial relationships, which in turn created the foundations for successful business partnerships extending between various points in Europe and the Levant. The Greek-Orthodox partnerships spread risk among a limited number of diverse shareholders and provided guaranteed business and support. Stephanos Xenos, for example, attributes the success of the Oriental and Greek Navigation Company to his fellow Greek-Orthodox firms in Britain. He had support from his co-religionists and was an insider in a club that shared a religion, culture, community, and language. In a letter to G. P. Lascaridi (which Xenos translated from the original Greek) he explains: “I have exclusive support of the Greek merchants in London. In the Levant I am popular, owing to my family name….”Footnote 97 He credits Greek-Orthodox backing in Britain and abroad for his shipping company's wealth vis-à-vis London's top shipping firms: “[The company is] able to keep up a brisk competition with Messrs. Smith, Sundius, and Co., and others, as [it] enjoyed the exclusive patronage of the Greek houses of London and Manchester.”Footnote 98
A major part of the Greek-Orthodox families' success was their participation in specific, still nascent forms of large-scale, speculative trade—what was later institutionalized as the “futures” market for cotton and other goods. The exchange of bills of lading for products like cotton prior to the arrival of cargo to ports was a practice that Sven Beckert traces to the early nineteenth century.Footnote 99 However, he suggests, at mid-century speculative trade remained in its infancy.Footnote 100 The Greek-Orthodox and Levantine companies appear to have been at the forefront of the rapid growth of speculative trade. As Malcolm Meason observes from his own experience working for these firms: “For a purely English house to carry on transactions of such magnitude would have been a simple impossibility … it was not until the Greeks—or rather what is called the Levant trade—took to trafficking in bills which had really nothing whatever behind them in the way of money or capital, that a regular and large profit began to be made out of this kind of paper.”Footnote 101 From the mid-nineteenth into the early twentieth century, members of the Levantine companies telegraphed bills of lading for several different raw goods to their partners in Europe. These partners sold the goods in whichever market would give them the best price, before they reached English, French, or other European shores.Footnote 102 The profits that the trading houses made from the anticipated sales could then be used to purchase textiles or other manufactured products for the return cargo.
Despite the occasional damaged shipment or diverted ship, the Levantine businessmen's early partnerships with the Greek firms of Spartali & Lascaridi brought in well over £100,000 in 1857 alone due to their risky but profitable futures trade.Footnote 103 In the late 1860s, speculation on futures started to become enshrined in market institutions of products like cotton and grains. The members of the Greek-Orthodox partnerships influenced the restructuring of British trading practices in cotton and other markets.Footnote 104 In the late 1850s, Greek businessmen Constantine Peter Lascaridi, for example, became a major shareholder and decision-maker on the board of directors for The Atlantic Royal Mail Steam Navigation Company, which was a partner of the American Express Company in New York.Footnote 105 In the growing cosmopolitan port city of mid-nineteenth-century Beirut, twenty-nine different Levantine merchants with ties to the Sursuq extended family served the four biggest Greek trading houses.Footnote 106 By 1866, the Levantine business families had added to their 1858 London branch by building offices in the major commercial centers of Paris and Liverpool.Footnote 107 As global trade increased, they had become major investors in European stock markets and established partners in British-based companies.
FROM GREEK-ORTHODOX CONNECTIONS TO EUROPEAN PARTNERSHIPS
At the beginning of Europe's recovery from the great depression, technology, modern science, and capitalist power began to form a trifecta for global capitalist expansion by appropriation: rubber from Malaysia, nitrates from Chile, and copper and gold from Australia all entered the world market.Footnote 108 European polities and companies scrambled for Africa. With the British occupation of Egypt, British companies renewed their search for new sources of raw cotton and other raw materials to fulfill Manchester's increased manufacturing demands. Imports and exports between the Ottoman Empire and Britain quadrupled and increases in commodity exchanges between the Mediterranean coast and Britain were even more pronounced.Footnote 109 By the end of the nineteenth century, the import of cotton-piece goods and other manufactures to the Levant and the export of grains, raw cotton, and cottonseeds to Europe comprised a major part of the Levantine companies' business. The Levantine business families expanded the production of cotton and other export products, extended their European-Ottoman business partnerships, and became majority shareholders in major trans-regional and European cotton companies.
Even in the period of intense, European-dominated trade on the global market, the Levantine companies continued to partner with and compete against European firms, at times dominating the European market. Trade between parts of the Ottoman Empire and Western Europe escalated in both directions after the signing of the Anglo-Ottoman Convention in 1838, and then during the American Civil War, in part pushed by business interests on both sides of the Mediterranean. They reached an apex in the final two decades of the nineteenth century and the early part of the twentieth. Cotton trade made up the bulk of this increase.Footnote 110 New industrializers like Germany and Italy entered the Levantine market. The years 1895 and 1907 corresponded to a construction boom in the Levant, including the building of Syrian railways such as the Damascus-Hauran Line (1894), the Damascus-Beirut Line (1895), connections to Aleppo (1906), and the Hijaz railway link to Haifa (1906), many of which were funded legally or arguably illegally by the Levantine companies.Footnote 111 In the beginning of the twentieth century, the Khedivial Line (The Khedivial Mail Steamship & Graving Dock Co.) and other steamers made frequent trips between Liverpool and Alexandria before heading to Haifa and other Syrian ports.Footnote 112 After a brief lull in the global market due to the Knickerbocker crisis, trade continued to increase with metals, minerals, and hydrocarbons gaining value as well.Footnote 113 Foreign banks rushed to open multiple branches in Istanbul, Cairo, Beirut, and Jaffa as foreign interest and investments in the region intensified.Footnote 114
The number of grain and cotton exports traveling from Haifa and Syria's other ports also rose steadily from the 1880s.Footnote 115 The growth of Haifa as a major port in the region was linked to the Ottoman government's choice to move the administrative capital of the region to Beirut, influenced by the Sursuq and Bustrus families. In 1865, an imperial firman (decree) announced that Damascus would be the new capital of the “super-province” of Syria.Footnote 116 Even before the firman was published, the Levantine companies, led by Niqula Sursuq and Habib Bustrus, petitioned the Ottoman government to make Beirut the administrative center instead.Footnote 117 The leaders of the Sursuq and Bustrus companies understood what was at stake economically and politically if Beirut was to become the administrative capital of northern Palestine. The Eastern coast of the Mediterranean was becoming one of the most rapidly developing coastal regions in the Ottoman Empire. Indeed, the question of whether Beirut was a provincial capital or a province of Damascus directly affected the capital accumulation and business standings of the Levantine companies. By making Beirut an administrative capital, the Ottoman government would “[shift] the jurisdiction of [the Levantine companies'] newly acquired land [in the Jezreel Valley (Marj ibn ‘Amr)] to the courts of capital Beirut,” placing “their landowning affairs on their own doorstep.”Footnote 118 This move would help the Levantine families administer their own land to the south.
Indeed, the primary reason for the Levantine companies' interest in making Beirut a provincial capital was that their land in Marj ibn ‘Amr would then fall under the jurisdiction of officials in Beirut, officials who, like Ali Pasha, were economically, politically, and oftentimes even familially related to them.Footnote 119 The move also gave the Levantine business community a familiarity with the judges and the system of the shari‘a courts in Beirut as well as a political leg up when it came to major infrastructure decisions that affected their own capacity for capital accumulation.Footnote 120 As shareholders of the Beirut port company, and landowners of the most fertile land in Palestine, the Levantine companies' success was tied to the port's expansion and their own land consolidation, tasks more easily realized if shari‘a courts and Ottoman administration were familiar and close to home.Footnote 121 Moreover, Levantine families took on administrative roles in the region in order to support their businesses both politically and financially. For instance, Ottoman officials in Istanbul correctly speculated that Nakhlé Sursuq was capitalizing on his new position in Haifa and its ties to officials in Beirut to funnel money into the creation of a railway from his family's lands to the Haifa port.Footnote 122
By the 1880s, the Levantine business families were associated with much of the cotton and grain trade between the Levant and Britain. They caught the attention of companies in Britain, France, and Germany. The Levantine firms partnered with large European companies for the development of export-oriented agriculture. The Beiruti-based firms could easily translate the shareholding practices of their own companies into shareholding in joint-stock European companies. In the second half of the nineteenth century, the Levantine firms did business with German settlers organized as the German-Levantine Cotton Company (Deutsch-Levantinische Baumwoll-Gesellschaft).Footnote 123 In 1899, the company was exporting more than fifty thousand bales per year from Levantine company-owned land and was using several thousand spindles each in Tarsus and Adana, “[all] owned by the wealthy Greeks,” some of them members of the Levantine business community.Footnote 124 In the early twentieth century, the leaders of the Levantine firms helped the German-Levantine Cotton Company establish a “musterfarm” to grow cotton and teach peasant laborers about cotton production, and to expand into the regions adjacent to Mersin-Adana. Similarly, the French Company of the Imperial Farms of Çukurova (La Société des Fermes Imperiales de Tchoucourova), founded in 1912, entered into partnership agreements with Levantine firms when the Ottoman government ultimately prevented the companies' planned purchase of 720,000 dunams to grow cotton for the German market.Footnote 125
In 1906, about fifteen years after they encouraged large-scale cultivation for the export market, one member of Sursuq and Brothers, Negib Sursuq, became a director on the board of directors in Egypt for The United Egyptian Lands, Ltd.Footnote 126 In the United Lands own outline of objectives, its members proclaimed the need for stability and “capitalist principles,” such as the introduction of a stable market for land with the nurturing of the “purchase, development, and subsequent leasing or re-sale of agricultural and building land.”Footnote 127 One of the company's first actions, in November of 1906, was to begin purchasing large tracts of land in the Sursuqs' names. This family and their Levantine business partners consorted with the company to develop the fertile areas of the Nile Delta for growing long-staple cotton for export.Footnote 128 Some of the European companies and settler-colonial groups failed to attain permission from the Ottoman government to buy land in places like Adana-Mersin and the Jezreel Valley, as was the case with the French Company of the Imperial Farms of Çukurova. The Levantine companies instructed them in how to use various permissions granted by shari‘a courts, such as power of attorney, to transfer land through private contract without having to change names in the official tapu registry.Footnote 129
In addition to partnering with European companies, the Sursuq family created a company with various local partners with the initial “capital of $40,000 … for the cultivation of cotton in the neighborhood of Beisan.”Footnote 130 The Sursuq and the Tueini family members began to grow cotton in this region and others in Palestine's fertile valley, helping to bring more and more land under cultivation.Footnote 131 After the Levantine business community had accumulated land in the Jezreel, it purchased pumps powered by small engines or kerosene and electric small turbines to redirect the output of water mills near canals for irrigation.Footnote 132 They began trading Palestine's cotton on the global market for an average of 18 francs per ton for cotton from Besian, 10–16 francs per ton for cotton from the Jezreel Valley (Marj Ibn ‘Amr), and 10 francs per ton for cotton grown in the environs of Nazareth, in villages like Aylut.Footnote 133 The Sursuq records show that the Levantine companies also began to encourage the cultivation of tobacco and sugar on their land in Alexandria, but the majority of this land they reserved for cotton.Footnote 134
The Levantine companies' influence on the British markets went beyond their role as landowners. As trade increased, their primary residences and storage spaces remained in Beirut, but their control over European cotton, grain, and metals markets became so significant that their activities impacted European stock markets and global trading behaviors. Companies in Britain and France paid close attention to the Levantine business activity because it affected their bottom lines. In October of 1881, for example, the London Standard and the Daily News reported that one single joint suspension of payments from the Sursuq and Debbas families had greatly disrupted the stability of the French Bourse. One transaction made on behalf of the network of these family companies and their partners led to “liabilities … estimated at five million francs, lost on speculative operations in the rise in Egyptian Stocks.”Footnote 135 The Levantine companies also sold large volumes of copper, helping to sustain its continued high price on the global market.Footnote 136 In one transaction alone, George and Alfred Musa Sursuq sold 400 tons of copper at £77 per ton to The Russian Bank for Foreign Trade and its London-based partners.Footnote 137
In Liverpool, representatives from the Levantine business families, like Alfred and Iskander Sursuq, sat alongside their Greek partners on the Liverpool Cotton Exchange Board and partnered with new trading firms like Charles Coury, and reputable Liverpool-based companies such as Hornby Hemelryk & Co., R. Atwood Beaver & Co., and Merryfield, Ziegler & Co.Footnote 138 Beckert mentions the long-time merchant company Zeigler & Cie., and the important bankers the Rothschilds, as having vital connections to cotton during the first half of the nineteenth century.Footnote 139 What he does not mention is that the Levantine companies traded with these companies and acted as bankers and intermediaries for Baron Edmond de Rothschild and The Russian Bank for Foreign Trade in Palestine.Footnote 140 Furthermore, the Sursuqs and their Levantine relatives became major shareholders in some of these British companies, contributing expertise and capital to the thriving merchant trading houses in Liverpool. “The business of the firm [Charles Coury & Co., for instance] include[d] transactions in Cotton, Sugar, Wheat and other produce.”Footnote 141 In 1912, the firm's directors Charles Coury and Alcide Barriere called on the Sursuqs to invest. Ilyas Sursuq became the company's largest shareholder, although it retained its name Messrs. Charles Coury & Co.Footnote 142 Behind the doors of 31 Brook Street Grosvenor Square, the Levantine business community was controlling the majority shares and the activities of successful so-called “European” trading firms.
LEVANTINE COMPANIES, THE EASTERN MEDITERRANEAN, AND MODERN CAPITALISM REVISITED
This study of the Levantine companies has illustrated the parallels and collaboration between nineteenth-century Western and non-Western business communities, and the amorphous naturalized Britons in between. Dutch and English capitalism, which have come to be recognized as modern forms of capitalism, developed out of the protracted history of long-distance trade. In the nineteenth century, European capital moved to the production of cash crops such as sugar, tobacco, indigo, opium poppies, and cotton and to the discovery and mining of gold and silver in America that relied on coerced or semi-coerced labor for production and extraction. The members of the Sursuq, Bustrus, Tueini, Khuri, Debbas, Trad, Tabet, Naggiar, and Farah families maintained tenant contracts, preserved sharecropping structures, and engaged in other forms of labor control rooted in the Ottoman social formation. Observing this from parts of Britain, France, and Germany, Europeans and newly immigrated settler-colonialists mistook these types of labor control for production as “backward” forms of feudalism or precapitalist modes of production. Scholars like Timur Kuran, as well as experts in the regions of Palestine and Egypt such as Gershon Shafir and Roger Owen, have repeated these European observations as fact. Yet the Levantine companies own private papers show that Ottoman configurations were much more efficient for capital accumulation in the Ottoman context and for Ottomans doing business in parts of Europe. While these same European observers attributed the Levantine companies' successes to “adopting the Western Spirit” of capitalism, their reliance on semi-coerced labor sometimes resembled strategies of their European and American competitors and they were often more effective.Footnote 143
So what is capitalism, and how did nineteenth-century capitalism develop if not from European practices exported across the Mediterranean, as culturalists and their critics imply? After all, Shafir asserts that it was the European-inspired political and economic reforms of the Ottoman Tanzimat that started the Ottoman Empire on its trajectory toward the adoption of European capitalism.Footnote 144 I argue here that, in changing historical contexts, the primary economic features of capitalism—free wage labor, production for the market, private ownership over means of production, and the extraction of surplus value for the purpose of capital accumulation—depended on certain cultural and political factors and social relations, many of which scholars continue to consider as precapitalist, non-capitalist, or anti-capitalist. Expressly, between the mid-nineteenth century and World War I, competition between Western and Levantine firms around mutual sharing of techniques, some of them not strictly capitalist, shaped the development of capitalism around the Mediterranean.
The tendency for Marx's “two freedoms”—free wage labor and a class that is “free” of ownership of the means of production—in fact came to dominate labor-capital relations sometime in the post-World War I period.Footnote 145 After World War I, primarily because of the ruptures the war created, the Levant and Levantine forms of labor began to look much different. Settler colonialism in Algeria, Palestine, and to a lesser degree Tunisia, the settlement of nomads in Çukurova, and large-scale European capital investment backed by imperial power, particularly in cotton in Egypt, led to the imposition of colonial rule. Only then was Levantine capital accumulation reshaped into a form that was largely, though never entirely, subordinate to Europe.
