the Filipinas merchants go to China to buy, as has been seen during many years’ experience with the former method.  But it might even be well to put an end to the coming of the people of Chincheo to Manila (many of whom live there by agreement), because they have already attempted to take possession of the city; and now, when the Hollanders are resorting thither, this should be more carefully watched.  To prevent the coming of the Chinese, your Majesty might order the inhabitants of Macao to take to Manila the silks, bronze, and other things needed in Filipinas which the people of Chincheo bring.  And everything will be more secure, the profit will be much greater, and all of it will accrue to your Majesty’s subjects if it be ordered that the Chinese shall not sell anything that the inhabitants of Macao have to sell.

The trade of Filipinas with Japon is very hurtful to your Majesty and to your subjects, since, as they carry in it nothing but silks from China, which the people of Eastern India and those of Macao also take to Japon, all the advantage lies with the Japonese; for, as they are in their own land, and have a larger number of articles to choose from, they buy where they wish and at their own figures, and they sell their own goods in the same way.  All this is injurious to your Majesty’s subjects, and advantageous to that king to whom they pay so large customs duties.  Sometimes the people of Felipinas and those of Eastern India have returned without selling or buying, in order not to suffer total loss.  Thus results a great loss of customs which ought to be paid to your Majesty.  And not alone do you suffer in your exchequer but also in your reputation, because the Japonese despise your Majesty’s subjects when they see the disorders that they create; [7] and they lose [also] respect for your viceroys.  When, in order to correct this impression, certain embassies are sent to those kings, they judge from this that your Majesty’s subjects have greater need of them than they have of your Majesty or your viceroys.  This has been observed during all these past years, especially among the Japonese—­who, being arrogant, proud, and warlike, think that everything depends upon them, and ask odds of no one.  They, judging by the great number who go to Japon from Felipinas that they are necessary to the latter, have ever thought of making war upon these islands in order to conquer them for themselves. [In the margin:  “And now that the Northerners are there, it is possible for them together to attack the forces.”]

From what has been said the plain inference is that your Majesty, who is king of both realms, ought to order that the trade be so conducted that what is gained by one be not lost by the other.  You ought also to consider which line of trade will profit you most, and should enforce this one and prohibit the other by decrees issuing from both crowns, enforcing them through your viceroys, and imposing severe penalties upon violators of such decrees, and greater ones upon those who fail to require them to be kept. [In the margin:  “This was ordained by the king, Don Felipe Second, grandfather of your Majesty, as the Council of Portugal will inform you.”]