The Continental System was an attempt by French Emperor Napoleon Bonaparte
to cripple one of his enemies in the Napoleonic Wars
– Britain – by destroying their trade, then their economy, and then their democracy through a blockade. It was also an attempt to reshape the French export market and economy, which had lost access to colonial markets.
Creation of the Continental System
Two decrees, that of Berlin in November 1806 and Milan in December 1807 ordered all allies of France, as well as all countries who wanted to be considered neutral, to cease trade with the British. The name ‘Continental Blockade’ derives from the ambition to cut Britain off from the entire continent of mainland Europe. Britain countered with the Orders in Council, a counter blockade which helped cause the War of 1812 with the USA.
The System and Britain
Napoleon believed Britain was on the verge of collapse, and thought damaged trade (a third of British exports went to Europe), which would drain Britain’s bullion, cause inflation, cripple the economy and cause both a political collapse and a revolution, or at least stop British subsidies to Napoleon’s enemies. But for this to work the Continental System needed to be applied for a long time over the continent, and the fluctuating wars meant it was only truly effective in mid 1807 – 08, and mid 1810 – 12; in the gaps British goods flooded out. South America was also opened to Britain as the latter helped Spain and Portugal, and Britain’s exports stayed competitive. Even so, in 1810-12 Britain suffered a depression, but the strain, didn’t affect the war effort. Napoleon chose to ease gluts in French production by licensing limited sales to Britain; ironically, this sent grain to Britain during their worst harvest of the wars.
The System and the Continent
Napoleon also meant his ‘Continental System’ to benefit France, by limiting where countries could export and import too, turning France into a rich production hub and making the rest of Europe economic vassals, and this damaged some regions while boosting others. For instance, Italy’s silk manufacturing industry was almost destroyed, as all silk had to be sent to France for production. Most of the ports and their hinterlands suffered.
The Continental System represents one of Napoleon’s first great miscalculations. Economically, he damaged those areas of France and his allies which relied on trade with Britain for only a small increase in production in some areas of France. He also alienated swathes of conquered territory which suffered under his rules. Britain had the dominant navy, and was more effective in blockading France than the French were in trying to cripple Britain. As time passed, Napoleon’s efforts to enforce the blockade bought more war, including an attempt to stop Portugal trading with Britain that led to a French invasion and the draining Peninsular War, and it was a factor in the disastrous French decision to attack Russia.