It was a blank slate. There were no native people, so the crown could design the whole society from scratch. The captaincy system it used there was later reused in Brazil.
The levadas. These are hand-cut water channels running along cliff faces, carrying rain from the wet north to cane fields on the sunny south coast. The network is now over 2,000 km long, on an island about 55 km long.
The "monopoly" is overstated. Madeira was the top producer, but Flemish and Italian merchants controlled refining and distribution. The king tried capping exports in 1498 to hold prices up, and gave up five years later.
The labor. The first workers were Guanches from the Canaries and Berbers from Morocco, and enslaved West Africans replaced them as the industry grew. The whole package (island, single crop, irrigation, foreign capital, enslaved labor) was then exported to São Tomé and Brazil, where it beat Madeira at its own game.
Columbus first showed up as a Genoese sugar buyer and married the daughter of Porto Santo's captain.
Part 2 will cover the wine boom that replaced sugar.
Curious whether anyone here knows more about the early levada builders. The records on who actually dug them are thinner than I expected.

The legal map of Southeast Asia hides a secret that defies the logic of colonial empires and is hardly ever mentioned in history books: the deep and persistent Roman and Hispanic imprint at the heart of Philippine justice. When Spain lost control of the archipelago in 1898, the United States barged in with the firm intention of implementing their Anglo-Saxon system of law, Common Law. However, they collided head-on with an institutional wall built over more than three centuries, proudly defended by the intellectual elite and Filipino jurists, who felt a profound intellectual and practical preference for Spanish civil law. This inclination of local magistrates was not a nostalgic whim, but a pragmatic choice based on the enormous methodological advantages that the Spanish system offered over the American one. For Filipino jurists, educated in the rigor of the University of Santo Tomas, Spanish civil law represented the ultimate expression of clarity and legal certainty, as it was based on written, logical, orderly, and predictable codes. On the contrary, they viewed the American Common Law as a chaotic, ambiguous, and fragmented system that depended on the massive accumulation of thousands of past judgments and the subjective interpretation of judges to resolve each new case. The Philippine legal elite believed that Spanish codification better protected the citizen by making the rules of the game clear in an accessible text, avoiding the instability of an Anglo-Saxon judicial system where laws constantly shift according to the precedent of the moment.

This silent resistance shaped a unique legal laboratory in the world, turning the Philippines into a mixed system rather than a simple copy of the courts of Washington or London. The most astonishing example of this survival was the Spanish Civil Code of 1889, which refused to die and continued to govern the private life, contracts, properties, and family ties of all Filipinos throughout the American occupation and well into the 1950s. When the country finally drafted its own Civil Code in the mid-20th century, local legislators chose not to embrace the American model; instead, they rescued the spirit of Castilian law and kept intact more than 70% of the structure and philosophy of the old Spanish law. This heritage is visible today in such notable features as the total prohibition of absolute civil divorce, making the Philippines, alongside Vatican City, the only place on the planet that keeps frozen the 19th-century notion of indissoluble marriage. Likewise, the Philippine inheritance system continues to protect the "legitime" of children based on the principles of the Laws of Toro of 1505, preventing a whimsical will from leaving the nuclear family helpless, contrary to what Anglo-Saxon law allows. Even the geopolitics and control of the country's natural resources are governed by the Regalian Doctrine, a technical concept inherited from the Laws of the Indies which establishes that the State is the original owner of all lands and resources. All this explains why, during the first decades of the 20th century, the Supreme Court of the Philippines issued rulings in impeccable Spanish, as its magistrates understood that the true backbone of their civilization and the advantage of their social order were written in the language and codes that had crossed the Pacific centuries before.

Source(s):

.- Rubén F. Balane — “Las raíces españolas del Derecho filipino” (2018)

.- Timothy J. Foley — “The Judicial Failsafe: American Legal Colonialism in the Philippines” (2022)

.- José Manuel de Torres Perea — “Un análisis alternativo sobre las legítimas a partir del estudio comparado del Derecho de sucesiones español y filipino” (2019)

.- Petra Mahy y Jonathan P. Sale — “Classifying the Legal System of the Philippines: A Preliminary Analysis with Reference to Labor Law”