Chapter 820: Trade Deficit
Chapter 803 – Trade Deficit
Not able to leave the main force of the French army, Hutier and others did not continue to pursue the Egyptian colonial army interest. After the end of the battle, the 8th Division immediately began a large conscription campaign.
Within a short period of one week, the establishment of the 8th Division was tripled, and all the young men in the surrounding area were recruited.
Finally, there is still a conscience, not really like the bandits to men, women and children into the army as cannon fodder.
The army marched down the Nile, ignoring the cities along the way and picking out the plantations in the countryside.
While destroying the manor houses, the enslaved Egyptians were recruited into the army to spread the idea of national independence.
Relying on the bullying method of fighting, the eighth division can be said to be smooth sailing, snowballing rapidly expanding.
In contrast, the progress of the main force of the insurgent army was much worse. Unlike Huttil and others who did a job and left, the insurgent army still has a pursuit.
If you want to be a warlord, you need territory. Mahdi, the leader, can no longer suppress the scene, and all the major power factions have moved out to grab land.
They even fought over turf. If not for the threat of the French, it is estimated that the insurgents themselves would have split up.
In order to unite the insurgents against the next French counterattack, Lieutenant General Jarrett has made many trips to coordinate the relationship between all parties.
However, what should be chaos was still chaos. The insurgent army was too complicated, with internal conflicts arising all over the place, and it was only due to the threat of the French that an empty framework of unity was maintained.
As the leader of the rebel army, Mahdi was very dissatisfied with this situation. However, the blowing up of the Aswan Dam in front of him caused his prestige within the insurgent army to fall drastically.
If it were not for the support of the British, it is uncertain whether he would have been able to hold on to his position as leader.
By this time, if he still didn’t know that he was pitched by the British, Mahdi wouldn’t have been able to leave a great reputation in the original time and space.
Facts have once again proved that all pots can be memorized, but only the black pot can not be touched.
Topped with the reputation of ruthlessness, Mahdi recruiting juniors are difficult. People really don’t have a good feeling about this boss who may betray his own people at any time.
As a result of this, Thunderbolt, the number two figure of the insurgent army, directly took his troops and set off towards the river valley plains, preparing to cut off one side.
There was nothing Mahdi could do about it, and although he won the first round of the anti-siege war, his political popularity plummeted as a result.
The insurrectionary army, which was not bound by substance, and which was raised only by personal prestige, was itself a loose alliance.
The Mahdi had no choice but to join in the land grab. This made Lt. Gen. Jarrett, who wanted to wield his division to attack the Yellow Dragon, very dissatisfied.
In the command center of the insurgent army, Lieutenant General Jarrett said righteously, “Gentlemen, the crisis has just begun, and it is still far from the time to enjoy the fruits of victory.
The French will not be willing to lose, it won’t be long before they make a comeback, and then we won’t be facing the rabble of the colonies.
I’m sure you’ve all heard of the reputation of the world’s first army. It’s not something the French blew out of the water, it’s something that was fought from the battlefield, sword by sword.
With a fluke they won once, but the same tactics couldn’t be used a second time. After falling for it once, the French cannot fall for it a second time.
In the future, we will face an unprecedentedly bitter battle. To dominate the next battle, we must take this place first.”
Looking along the location where Lieutenant General Jarrett’s baton was pointing, there was no surprise that it was none other than Cairo.
This ancient city, which had political, economic, and military value all in one, was crucial to the insurgent army’s next battle.
By taking Cairo, the insurgents would have a chance of independence from the French.
A middle-aged man asked suspiciously, “Your Excellency, Lieutenant General, hasn’t the Eighth Division already departed towards Cairo?”
It seemed to him that the French army in Cairo, which had suffered heavy losses in the battle not long ago, was now at its emptiest strength and could not hold back the Eighth Division.
Jarrett shook his head, “Edsonel, you are too optimistic, Cairo can be different from which small towns you have encountered.
As a matter of fact, the reason why the insurgents are going well is that the French in these small towns are scared out of their wits and have not organized a decent confrontation at all.
Cairo is different, it’s the center of Egypt, and the French will certainly not give up.
The news of the defeat at the front had already been sent back, and the French who had stayed behind were expected to have organized a new garrison by now.
Without heavy firepower, it’s a complete fool’s errand for the Eighth Division to try to capture the heavily defended French city of Cairo.”
Frankly speaking, Jarrett was still satisfied with the Eighth Division under the command of the Austrian.
Whether it was trashing the cotton plantations along the way or heading straight for the Delta, it was very much in Britain’s interest.
As things stood, Egypt’s cotton production capacity was destined to plummet this year, and it would be difficult to recover for years to come.
This is undoubtedly the biggest piece of good news for British cotton spinners. This is undoubtedly the best time to seize the market, as the supply of raw materials from competitors is insufficient and production capacity is falling.
Although this is not Jarrett planning, but this does not prevent him from taking the credit on himself.
Politics is also about quid pro quo, as the leading player in this Egyptian rebellion, it is natural that after returning home, he will receive a share of the domestic enterprises in return.
It could be financial or political, but in short, Lt. Gen. Jarrett had made a fortune this time.
Drumming up the insurgent army to attack Cairo was only part of Lieutenant General Jarrett’s plan, and if possible what he wanted most was for the insurgent army to march on the Suez Canal.
The best thing is to block the navigation of the canal, and then the British Empire can use the opportunity to defend the navigation of the canal, the power deep into the Suez Canal area.
……
Capital markets are keen, affected by the loss of the Egyptian battlefield, Paris textile companies share prices plummeted, a number of companies engaged in the operation of the Egyptian plantations directly bankrupt.
The mountain rain is full of wind, by the textile industry share prices plummeted by the chain, in just one week, the Paris stock market as a whole fell 11.4%, billions of francs of market value was evaporated.
International cotton prices also appeared violent shock, London’s cotton futures market, cotton prices once soared by one-third.
Under this double blow, the French cotton textile industry ushered in the biggest winter.
Affected by the reduction in the supply of raw materials, countless enterprises announced layoffs, production cuts, a time when the social unemployment rate skyrocketed, the French economy once again encountered challenges.
Although prepared for this, when it really happened, Napoleon IV was still like a lifetime ago.
No matter how bitter heart, the problem still want to find a solution, or a new round of economic crisis will break out again.
After the Paris revolution, Napoleon IV was very alert to the economic crisis that might shake the foundation of his rule.
“The domestic economy continues to deteriorate, what plans does the Ministry of Economy have?”
After a little thought, the Minister of Economy, Elsa, replied cautiously, “This economic turmoil is mainly due to the impact of the Egyptian rebellion, and cotton production capacity has dropped significantly.
Coupled with the drought that hit North America this year, and the reduction of cotton production in several federal states, the price of cotton on the international market has risen dramatically as a foregone conclusion.
The Ministry of Economy suggests that the government temporarily exempt cotton import tariffs to reduce the cost of importing raw materials for textile companies, while giving them low-interest loans to tide them over.”
Lower tariffs, will it work?
The answer is: no.
Insufficient supply of cotton on the international market means that there are bound to be enterprises that cannot purchase enough cotton.
Capital cooperation is also about first-come-first-served, engaged in the cotton wholesale capitalists, at about the same price, will certainly give priority to choose and reliable old customers.
Many supply partnerships, which have lasted for years, or even decades, are simply not something that can be easily pried up by those who come after them.
Most of these enterprises are concentrated in Britain, as a latecomer to the French cotton textile industry, more or occupy the Egyptian cotton production area before the development.
Unless you can pay a high price to buy, otherwise the French textile enterprises, in the international market simply can not acquire enough cotton.
It is because they know all this, many enterprises in the reserve of cotton is not exhausted before the announcement of layoffs, production cuts, in order to cope with the next crisis.
Foreign Minister Terence Burgin reminded: “It’s not that simple, international cotton wholesalers are not fools, it’s impossible for them not to knock on the door of such a good opportunity.
If nothing else, they may use it as blackmail to get us to permanently abolish cotton import tariffs.”
Tariff barriers are also one of the main reasons why the French cotton plantation economy has been able to thrive.
High tariffs made otherwise cheap cotton, which entered the French market, uncompetitive, and native plantation merchants made a fortune.
Driven by profit, capitalists investing in cotton plantations in recent years have also been increasing, and the French have basically realized self-sufficiency in cotton.
This is detrimental to the interests of overseas cotton growers, wholesalers, everyone is looking forward to this market.
In normal times, naturally nothing, with the power of France, not these interests can be shaken.
But now it is different, France’s cotton supply chain problems, had to think of ways from the international market.
Economy Minister Elsa objected, “Repealing the cotton import tariff is impossible. Without enough profit incentives, domestic capitalists simply won’t put money into cotton plantations.
Besides, it’s not just about cotton, it’s also about other industries.
Once we compromise here, the calls for us to abolish the tariffs will still be coming from behind.
With the economic development in the country, we will have to resort to tariff barriers to protect the national industries in the country for a long time to come.”
This is a fact that has been proven in the previous economic crisis. Participating in international competition, France really can’t right now.
Roy Vernon, Chancellor of the Exchequer: “Not only that, but the volume of our foreign exchange reserves has fallen sharply in recent times.
Now that we have to purchase a large amount of cotton from the outside world, which will inevitably consume a large amount of foreign exchange again, the amount of foreign exchange reserves of the empire has fallen into a very dangerous point.
As of now, our holdings of pounds sterling are 31,876,000, and our holdings of shields are 65,423,000, which, together with other niche currencies, total about 1,780,000,000 francs.”
The French economy has been in a trade deficit for years, ever since the guns went off in the Paris revolution. Relying on tariff barriers, it was hard to achieve a balance of trade, and within a few days of the good times, it is now in deficit again.
Long-term capital outflow is obviously not conducive to the development of the country’s economy. Finding ways to reverse the trade deficit has become a major problem for the French government.
Economy Minister Elsa: “The Marquis is right, to restore the domestic economy, we must find a way to get rid of the trade deficit situation.
Increasing exports is out of the question for the time being, even if there are no tariffs to impede it, our industrial and commercial products lack competitiveness in the international arena.
In the short term, if we want to solve the problem, there is no better way than to reduce foreign exchange expenditure.
At present, we are importing large variety of commodities, mainly: grain and coal.
The local coal production is insufficient, and no large coal mine has been found in North Africa. The only large coal mines under our control are still far away in the central and southern peninsulas.
However, if we want to meet the local needs, the production capacity is still far from enough, and also have to bear the high cost of transportation, self-sufficiency is simply impossible.
The only thing we can think of is food, Algeria, Tunisia, Morocco have areas suitable for agricultural production, as long as the development to meet domestic needs is not a problem at all.
The rate of return on investment in food cultivation is too low for capitalists to participate, and government investment is the only way to go.
This is also a good thing, as long as we control the degree, we can ensure that the interests of domestic farmers without harming the premise of food self-sufficiency.
Not only can we save a lot of foreign exchange expenses, but we can also combat our competitors on the European continent and guarantee strategic food security.”
Ever since the African farm program was proposed, Elsa had become an advocate of this policy, constantly extolling the benefits.
Of course, this was only the outside world’s opinion. In reality, Elsa did this more out of necessity than anything else.
Withdrawing from the free trade system also had both advantages and disadvantages, and while obtaining the benefits, one also needed to bear the disadvantages brought about by this policy.
If you restrict me, I will naturally restrict you. Affected by high tariffs, French industrial and commercial exports plummeted.
This is all just a small problem, relying on trade protection, driving out international competitors, the share of the local market left behind, has been enough for capitalists to make up for the loss.
But France is still a big importer of industrial raw materials, right?
The African development strategy of the previous years is one of the measures that the French government wants to get rid of its dependence on the outside world.
Although because of the lack of capital investment, the development of North Africa is slow, but from the results of the point of view, is still considered a success.
A variety of cash crops, including cotton, France has basically realized self-sufficiency, even if not self-sufficiency, the demand for imports has been reduced.
However, this is still not enough, not all resources, are able to self-supporting, coal and food is still hard.
For the non-renewable coal, Elsa naturally couldn’t do anything about it. In the face of the trade deficit, he could only choose to start with food that could be solved.
(End of chapter)