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The Hanseatic League
In this diversion we look at one of the most successful trading blocs in history - the Hanseatic League, also called Hansa, and in German Hanse.
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The term Hansa is derived from the old German word for associations and has been used for communities of travelling merchants since the 12th century.
What was the Hanseatic League?
Hansa was a confederation of merchant guilds and towns in Northern Europe that collaborated to pursue and protect mutual commercial interests.
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The League was based on North-South, East-West trade routes on the Baltic Sea and beyond. Furs from Russia were sourced for fashion garments in increasingly affluent Europe. Cloths from Western Europe and luxury goods from Southern Europe were traded east. Significant amounts of raw materials like timber and metal; goods like wax and cloth; and foodstuffs like grain and honey were traded in the middle.
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The success of Hansa went beyond creating massive wealth for its merchants, it became a major-influence on the politics and economy of the region.
Who formed the Hanseatic League?
Hansa was formed by seafaring traders in North Germany. The first treaty, between Lübeck and Hamburg, sought to create common laws and “clear the road of pirates and robbers between the Elbe and the Trave“.
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These merchants, often based around great merchant families like the Wittenborgs, formed guilds to capture more trade, defend against increased rivalry and occasional violence.
These guilds ultimately coalesced to form Hansa.
When was the Hanseatic League?
Hansa emerged in the middle of the 13th century and grew quickly to include more guilds and share of European trade.
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Merchants who had gained control of Baltic trade to the east and north, notably from Lübeck, collaborated with others who traded west and south through the Rhineland.
Its high point is generally regarded as the late 14th century, aided by German settlement in the modern-day Baltic States.
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The Hanseatic period lasted for approximately 400 years. The final formal gathering of the League took place in its pre-eminent city, Lübeck, in 1669.
Which countries were in the Hanseatic League?
Hansa was a confederation of merchant guilds and towns in Northern Europe that collaborated to pursue and protect mutual commercial interests.
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At its peak Hansa counted 200-225 member towns in its League, across 16 countries (although the map of Europe was significantly different then!).
Important centres on the coast included Lübeck, Visby and Danzig (now GdaÅ„sk). Inland Cologne, Bremen, and Krakow were notable. To the east Riga and Reval (now Tallinn).
Long distance trade was facilitated through large offices – kontor – in Novgorod (now Veliky Novgorod), Bruges, London and Bergen, plus smaller satellite centres such as Dorpat (now Tartu).
Check out the great map at https://www.hanse.org.
Why did the Hanseatic League prosper?
Many reasons exist why Hansa grew quickly and dominated for so long, here are some of our takes:
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Network Effect – traders were able to increase their connections, addressable market, and influence by being part of a larger organisation.
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Business Intelligence – by collaborating and cohabiting, merchants broke down language barriers and understood value-drivers such as supply and demand.
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Standardisation – Hansa removed barriers to trade by creating a common approach to quality control, weights, measures, business customs and laws (a court to settle disputes existed in Lübeck from 1373).
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Innovation – Hansa developed better shipping (cogs), a logistics chain based on secure warehouses, navigational aids, and innovative payment and financing solutions that facilitated more advantageous trade.
Scale – the financial at political clout of the League was significant. They used this to gain privileges, such as in England and Flanders, negotiate monopolistic trade deals, and form convoys to defend against attack by rivals and pirates.
How big was Hanseatic League trade?
Records where they exist are not complete or comparable. We are still working on this, check back soon.
Why did the Hanseatic League fail?
Hansa faced increased challenges from the mid-14th century.
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Rival traders emerged, first on a local level, and from the mid-16th century from wealthy Dutch, Italian and southern German traders who benefited from increased trade in Atlantic, Asian, and Mediterranean regions.
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Governments too pushed back. Hansa fought Denmark in the 1360’s and prevailed. The Polish-Lithuanian Union in 1386 posed a threat in the east, followed by Russia which exited Novgorod from the League in 1494. Hansa lost their monopoly in the Baltic Sea with defeat to Sweden in the 1530’s and was expelled from London in 1597 due to its perceived threat to England’s maritime prowess.
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Hansa was not a country nor a corporation thus there was no ultimate ruler or treasury, just diets of local meetings overseen by the kontor. Divergence of interests were inevitable, and slow decline ensued as local agendas prevailed.
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The Thirty Years War from 1618 to 1648 resulted in trade disruption, financial hardship, and the emergence of new nation states in Europe. This accelerated the decline of Hansa, with the last diet held in Lübeck in 1669.
Does the Hanseatic League matter today?
Undoubtedly. Trade and foreign direct patterns in the region are very strong. Many companies use Hansa in their brand, including Lufthansa, Hansapost and Hansabank (now Swedbank). German terms such as kontor are still used today.
There are also strong cultural ties based on shared history, architecture and kinship.
Fun fact about the Hanseatic League
Edward III of England pawned his crown jewels in Cologne between 1339 and 1344 to fund the early stages of the Hundred Years War. In return the king granted Hansa privileges and concessions in England, including Cornish tin mines. German traders became known as ‘Easterlings’ and had a reputation for sound money, this is thought to be the source of ‘sterling’ as the name for British currency.
