I Became A Hidden Powerhouse Of The British Empire [EN]: Chapter 339

How Egypt Ended Up on the Brink of Bankruptcy

The circumstances that led Egypt to the brink of bankruptcy are quite simple.

Since its de facto independence from the Ottoman Empire, Egypt had continuously sought to completely sever ties with the Ottomans.

Conversely, the Ottoman Empire was certain that if Egypt were to break away, it would become not just the sick man of Europe, but the corpse of Europe, and therefore would never allow it.

Thus, Egypt wanted to increase its national power to a point where the Ottomans couldn’t dare to covet it, and had been continuously attempting modernization.

However, all of that required money, and where would Egypt suddenly find that much money overnight?

Naturally, they had no choice but to borrow money, and the only countries in the world that could lend that much money were the British Empire and France.

The British Empire and France also had nothing to lose by indebting Egypt, so they lent a considerable amount of money.

Up to this point, it was a normal process.

If they hadn’t been so greedy and had been moderately satisfied, Egypt wouldn’t have faced any major crisis, but an incident occurred that forced them to be greedy.

That was the American Civil War.

I had even tipped off the Egyptian side in advance that the war was about to break out.

I told them I was worried that the amount of cotton exported from the South would plummet if the war broke out.

Anyone with a brain would inevitably come up with one thought here.

-Wouldn’t we make a fortune if we produced cotton?

If cotton wasn’t produced in Egypt, they wouldn’t have known, but unfortunately, Egypt was a country with a pretty good environment for cotton production.

As soon as they heard my story, Egypt saw it as an opportunity and began producing cotton in large quantities, and unsurprisingly, they made a huge profit.

Originally, there were plans to produce cotton in India as well, but I deliberately suppressed cotton production in India to a certain scale, except for the amount that Britain would use.

As a result, Egyptian cotton became a huge hit, and Egypt began to go all-in on the cotton coin more and more.

-Ah, how can you resist when you can just keep printing money by producing cotton!

What happened when Egypt, which had been suffering from chronic fiscal deficits, suddenly hit the jackpot?

They repaid all the debts they owed to Britain and France and managed their finances soundly… That’s not going to happen.

Egypt decided to take this opportunity to definitively outpace the Ottomans and embarked on massive large-scale projects.

They invested all the money they earned, took on more debt, and stepped on the accelerator towards an irreversible path.

That’s how everything in the world is.

People with little money can only borrow a few thousand or a few hundred thousand at most.

People who owe tens or hundreds of billions all have that much in assets, so they can borrow that much.

Egypt was exactly like that.

Still, Egypt wasn’t stupid, so they calculated everything carefully and took on debt.

They carefully calculated how the war was progressing and how long the war would last, and produced cotton and borrowed money.

However, when France and Prussia even joined the war, and it became clear that the war would be prolonged, Egypt was excited and let its guard down.

As a result, they concluded that it was okay to produce a huge amount of cotton and have a debt party.

The one who lent them money generously here was the Royal Bank of Canada, which I founded.

‘Our bank is offering loans at lower interest rates to attract new customers since it hasn’t been around for long.’

Impressed by the grand opening bleeding service [offering services at a loss to attract customers], Egypt began to borrow money like crazy, thinking they could pay it back with the money they made from cotton.

However, the war ended faster than expected due to the intervention of the British Empire, and I included a condition in the armistice agreement to lower cotton export prices from the South for only two years.

In addition, cotton production in India, which had been postponed until now, was resumed, so it was only natural that Egypt’s cotton industry would be destroyed.

None of the cotton they produced was sold, and they couldn’t even pay the interest, let alone the money they borrowed, so what would happen?

Spain could at least squeeze its colonies to repay the debt if the payment deadline was extended, but Egypt couldn’t repay it at all.

At this point, Egypt’s two major creditors are the British Empire government and the Royal Bank of Canada.

It’s not immediate, but since there’s no way to repay the money, bankruptcy was an inevitable fate.

Wellesley immediately began to pressure the Egyptian government and, in conjunction with France, also a creditor of the Egyptian government, began to move to establish a financial control organization.

A few days after sending a notice urging them to quickly pay back the money borrowed from Canada, riding on this trend.

The Egyptian ambassador, whose complexion was as pale as a corpse, visited my office with the most pitiful face in the world.

“Your Highness, I apologize for visiting you so late. In fact, I should have visited you a long time ago and apologized…”

“It’s okay. I heard you were being dragged around by the Prime Minister, so you didn’t have time to come here. I understand. Well, please sit down.”

When I kindly offered him iced coffee, the Egyptian ambassador sat down without a word and politely accepted the glass.

“Since you don’t have much time, I’ll just get straight to the point. Will I be able to get the money I lent to your country back on time?”

“Your Highness, that is…”

Why do all the ambassadors in London seem to have become pitiful debtors begging creditors to give them a break? Is that just my imagination?

Feeling a sense of déjà vu that I had seen a similar scene a while ago, I cheerfully rolled the ice in my mouth and shook my head.

“I’m in trouble. Considering our relationship with your country, I even gave you such a cheap interest rate, but last time even the interest was overdue. How can I continue to trust your country?”

“I have no excuse. But you know, there are some problems with the current finances, so the cash flow is not smooth.”

“I’m sorry to say this, but is there any reason why I should consider that? Or are you saying that the problems with your government’s finances are because of us?”

“No, no! I certainly didn’t mean it that way. However, cotton is being supplied from the South at excessively low prices, and suddenly Indian cotton is also being released, so the market price is…”

“We only told the South to supply cotton and food at low prices because that’s all they can compensate us with. India was originally going to produce cotton, but they weren’t good at it, so the efficiency wasn’t good, so it was postponed for a while.”

It’s not that we suddenly pumped up the cotton supply to screw over Egypt.

In fact, it’s natural for the supply to change rapidly after the war, so Egypt didn’t try to blame us for this.

Even if that’s the case, it’s not like we deliberately committed fraud; they just got excited and danced, but their steps got tangled, and they fell and broke their noses, so making such remarks is a diplomatic loss in itself.

All they can do here is beg for a break.

“First of all, it seems that the British Empire and the French government will agree to establish a financial oversight body to manage our profligate finances. All that’s left is Canada, but is Your Highness also in line with the government?”

“That’s not it. There’s no reason to.”

The British Empire is the government, so they’re planning to put in an official organization and meddle in their internal affairs, but why would I do that?

“If you can’t pay it back, I can just take the collateral, so you don’t have to worry too much.”

“···Yes?”

“I lent you money, but I can’t get it back. So I take the collateral. Isn’t that a perfectly natural flow?”

The ambassador nodded without saying anything.

“I’ve roughly calculated that if you sell all the shares of the Suez Canal that your government owns, you’ll get an amount that’s slightly less than the principal. It’s a little short, but considering your country’s difficulties, I’ll just cover the balance.”

“Sell all the shares of the canal…”

When I calculated it exactly, 40% of the Suez Canal’s shares were in my name and the royal family’s name.

And about 25% of the shares were held by private individuals, including James.

And the Egyptian government held more than 30%.

It was originally less than that, but they recognized the importance of the canal and bought shares from here and there from time to time, and it had grown to that level before they knew it.

Even so, I effectively held more than 60% of the shares, but the Egyptian government still didn’t know that.

“Selling all the shares is a bit…”

“You can buy back the shares scattered among the private sector later when you have more leeway. Then you’ll be able to secure about the same level of shares as you have now.”

“···Isn’t there anything else you can do?”

“No. I’m already giving you a break on the overdue interest, and if I give you any more breaks, other customers will complain. They’ll say, ‘You’re giving Egypt a break, why aren’t you giving us a break?’”

If I recover the 30% of the shares that Egypt has and buy the shares that I entrusted to James later, the Suez will become the exclusive property of the royal family.

In fact, it’s not just the royal family’s property; it’s just the royal family’s canal.

Now that it’s come to this, should I change the name to the Royal Suez Canal?

In the end, the Egyptian side realized that there was no way to hold out and signed an agreement to sell all of its canal shares to me on the condition that the principal and interest would be waived.

“You thought well. Hahaha!”

“Your Highness. Then please say something to the British Empire government…”

“Don’t worry. I’ll tell the Prime Minister to be a little lenient and not control Egypt too harshly since they’re in a difficult situation.”

“···Thank you.”

In fact, the ambassador, who has to bow his head because of an accident he didn’t even cause, is probably in an extreme job.

So, even if it’s just empty words, I have to ease his burden as much as possible so that he can at least get some comfort.

After finishing the satisfactory deal, I personally escorted the Egyptian ambassador out and prepared a carriage.

“Go to Oxford University.”

The war that has engulfed both the American and European continents has lasted for several years, so the repercussions of the war are reaching all over the world much more than in the original history.

Of course, I’m also responding quickly, but since this is a democratic country that adopts the principle of majority rule, it takes time to gather opinions to implement policies.

However, in these urgent times, those who move even a little faster and gain more become the winners.

Here, we must move not simply to gain profits in a haphazard way but under a clear standard.

If we become like France or Prussia, who are snooping around here and there saying, ‘Hehehe, give me colonies! Give me colonies!’, the aftermath will be bad.

In order to avoid this situation, it is necessary to present a clear theory and persuade the lawmakers to move within the framework of that theory.

And fortunately, I had someone who could print out the paper that would be the basis of this theory.

The reason why I didn’t bother to call him to Buckingham and went directly to the university was to guarantee even a little more of the time that my paper machine was running.

So, Marx. I’ve come to hear a report on how much progress has been made on the creation of a secret tax evasion technique for me.

Just as I was visiting his laboratory with high expectations that my paper shuttle [a person who produces documents rapidly], who had always satisfied me, would meet my expectations this time as well.

“So that’s what betrayal means!”

A familiar voice echoed loudly through the door in the distance.

I’ve definitely heard it a lot, but whose voice is it?

“Betrayal! There are things you shouldn’t say, even if it’s you! Watch your mouth!”

“You should watch your mouth! Are you really going to betray your ideals and become a capitalist dog!”

“Huh, you’re such a frustrating person! Don’t you know that this is the way to achieve true communism even faster!”

The owner of the voice fighting with Marx, who was full of anger.

I suddenly remembered whose voice it was and signaled my escorts to be quiet.

Slowly moving my steps and looking into the wide-open window, it was none other than Friedrich Engels and Karl Marx.

The two best friends and leading communist duo of the century were having a fierce argument.

Betrayal of ideals? A capitalist dog?

I just came to ask about the progress of the paper, but I’m seeing this century’s argument.