1737 economic crisis in the South Sea Islands

The 1737 economic crisis in the South Sea Islands was a major economic crisis in the South Sea Islands that had significant consequences for the nation and is often associated with its demise.

It began in the month of Grunil in 1737 when two ferries of Southern Seaways collided in the harbour of Joseph Town. The ships were both insured through Leroy's of Zeebrugge, but as insurance premiums had not been paid for over a year, the underwriters refused to pay the claims made by Southern Seaways. Without the insurance money, Southern Seaways was unable to repair or replace the ships and had only one smaller ferry left to operate the main ferry route between Zuid-Richel and Josephtown. Eastern Ocean Seaways took over the route in V.1737 but quickly found out that the route was no longer profitable because of the long term problem of a declining population in the South Sea Islands and in a press conference on 11.V.1737, they announced that they would stop their services, with the latest ferry operating in V.1738, the company refused to answer questions by the press whether they would continue to operate the connections between Zuid-Richel and Sankt Rosa in the Confoederatio Aemilia. The risk of losing their ability to ship goods from the South Sea Islands to Aemilia sent shock waves through the community of Aemilian businesses, including Camelwool, South Sea Flax and LaRichelle. On 17.VII.1737, these three companies announced in a joint declaration that they would sell their assets in the South Sea Islands and move operations to the island of Murder in the Confoederatio Aemilia, causing the loss of even more economic activity in the South Sea Islands. With their departure, many native South Sea Islander companies lost lucrative customers and had to downsize as well, resulting in a steeper population decline as many citizens started seeking their fortune in other countries, often following the Aemilian companies to the island of Murder.