a full defensive complex around San Juan, which included Forts San Felipe del Morro, San Cristóbal, and San Gerónimo. On the other side of the island, San Germán was left practically defenseless, and was easy prey to French attacks throughout the century from its colonies in the Caribbean. With the creation of the Captaincy General in 1580, Governor-Captain General Diego Menéndez de Valdés (1582–1593) continued to strengthen defenses around San Juan. To fund the construction and an enlarged garrison, an annual subsidy, the situado, was ordered from the royal coffers in New Spain, although for the next two centuries, the situado often did not reach Puerto Rico. The number of permanent soldiers under Menéndez de Valdés went from fifty to just over two hundred, and was later raised to over four hundred in 1596, the number at which it would stay for the next century. The improvements to the city's defenses proved to be ready by the time they faced their first major challenge, an assault by a 27-ship fleet led by Francis Drake. The island would also serve as an important bastion in Spain's struggles against the piracy practiced by its rivals in the Caribbean; this continued to plague Spain during the next two centuries. Many Puerto Ricans also became Spanish privateers, who operated against the British, French and Dutch possessions in the area; the most famous privateer of these men was Miguel Henríquez. During these periods of shifting formal and informal conflict, trading in contraband proved to be a crucial element of the local economy, as was common in many peripheral areas of Spanish America. It resulted in the siphoning off to foreign powers of most of the money that reached the island as the situado. To supplement the inadequate number of regular soldiers, local militias (milicias urbanas) were organized in each of the islands five districts (partidos) outside of the capital: San Germán, Arecibo, Aguada, Coamo, Loíza and Ponce. The militia men were not regularly paid nor were they armed by the government. Their weapons consisted of farm implements: machetes, improvised wooden lances and regular knives, but the governors-captains general usually attested to their courage. Each partido was overseen by a teniente a guerra, a deputy of the captain general. 18th century and the Bourbon Reforms Shaken by the losses of the Seven Years' War, in particular the capture of Cuba by the British in 1762, Charles