MALCOLM CALDWELL Imperialism in the Malay World ADAM Smith—who, along with his Scottish contemporaries, has so much to answer for in his formulation of the insidious theory and practice of industrial revolution—noted at the end of the eighteenth century the significance of Anglo-Dutch economic and commercial rivalry.1 It was a rivalry which extended all the way to South East Asia. The Netherlands, although at this time c(. . . in proportion to the extent of the land and the number of its inhabitants by far the richest country in Europe. . ."5 and therefore also endowed with the "greatest share of the carrying trade", were significantly weak in home industry. Smith correctly perceived that Britain could overhaul Holland given policies appropriate to encouraging industrialisation, regardless of the Dutch initial lead in capital accumulation and command of the carrying trade. The respective positions and trends of the two economies were to have an important bearing upon their colonial economic policies in South East Asia. Britain and the Netherlands had pressed hard upon the heels of Portugal and Spain in pursuit of the coveted wealth of South East Asia, and both the northern powers had been active in the region by the end of the sixteenth century. The Dutch at this time succeeded in wresting and securing a