Rise of Empires: Spain.

Chapter 550 Huge Compensation
The detailed terms of the peace agreement signed between Britain and the Allied Powers were not published, but some general clauses were still disseminated by various European countries.

Indeed, most of the treaty's contents could not be concealed. For example, the colonies ceded by Britain needed to be transferred to the Allied Powers after the peace treaty was signed, and these developments could not be kept secret from other countries.

Another issue is the amount of war reparations. While the exact amount might be concealed, the general scope cannot be hidden.

Some interested individuals have compiled data from various countries and have roughly arrived at a summary of the content of the British peace agreement.

In addition to recognizing Ireland's independence and ceding colonies to the Allied Powers, Britain was also required to pay £7.5 million in war reparations to the Allied Powers.

Considering the equivalent value of the Spanish pesetas to the French franc and the Italian lira, and given that the value of the Spanish pesetas remained relatively stable during this world war, the £7.5 million war reparations, calculated based on the actual value of the Spanish pesetas, totaled 192.4 billion pesetas.

The original exchange rate between the pesetas and the British pound was 25:1. After Spain joined the war, the exchange rate fluctuated, but the depreciation was not significant.

If calculated in francs or lira, the £750 million war reparations could be worth nearly 100 billion francs or tens of billions of lira.

The exchange rate of the franc and lira will likely change significantly in the future, so in any case, the reparations must not be linked to the franc and lira.

For Spain, linking this compensation to the Peseta is also extremely beneficial.

This could promote the popularity of the Spanish peseta, allowing Spain to gain recognition in other European countries and become a universally accepted global currency.

Although this reparations amounted to less than the Allied Powers' contributions to the war, it is undeniable that the total amount was an astronomical sum for any of the Allied Powers before the war.

Even if the money were distributed equally among the Allied Powers, each country would receive tens of millions of pounds, which would still be a huge sum.

Moreover, due to the differences in the strength and contributions of each country in the war, the proportion of reparations they received varied. Even 1% of the reparations amounted to a staggering £750 million, equivalent to a quarter's fiscal revenue for most small and medium-sized European countries.

Under such circumstances, even a mere 1% compensation percentage would be enough to cause a long and contentious dispute among European countries.

Although the Allied powers had different views on the proportion of reparations they would receive, Carlo had no concern about it whatsoever.

Given Spain's current strength and its position among the Allied powers, even if Spain's contribution to the war was not the greatest, it is still entitled to receive the largest share of war reparations.

Secondly, there's France; no country can rival France and Spain in terms of war reparations. Italy, on the other hand, has some concerns, given the Italian army's poor performance in the war and its barely passable results.

Because Spain and France had no need to worry about the proportion of reparations, their representatives could sit idly by while other countries argued over the proportion of reparations.

The meeting was as lively as a market, with diplomatic representatives from various countries arguing so much about their respective countries' share of reparations that they almost came to blows.

Fortunately, the meeting was held in Madrid, Spain, so even out of respect for Spain, other countries wouldn't actually start a fight.

However, all sorts of harsh words were still hurled at each other, showing no sign of the gentlemen that each country claimed to be.

Although each country wanted a larger share of reparations, the relative strength of each nation was undeniable, and everyone was well aware of each other's contributions during the war.

After all the fighting and scrambling, the final proportions for each party are still the same.

Of the total war reparations of £7.5 million and 192.4 billion pesetas, Spain, as the leading Allied power, was honored to receive 31.3% of the total.

Spain was able to receive a total of 60.2212 billion pesetas in war reparations, equivalent to three and a half years of Spain's total fiscal revenue before the outbreak of the war.

This war reparations was a huge sum for Spain, and Carlo was quite satisfied with the proportion of reparations Spain received.

Spain received roughly one-third of the reparations owed to Britain. The main reason for this was not Spain's strength, but rather its contribution to defeating Britain.

The ability to defeat Britain relied on two aspects: firstly, the navy confronted Britain, forcing the British Royal Fleet to refrain from deploying.

On the other hand, it caused trouble for Britain in its homeland and colonies, making it unable to attend to both ends.

First, let's talk about the latter, which is almost entirely due to Spain. The Irish War of Independence was instigated and supported by Spain, and even the Indian independence movement seems to have had Spain's involvement behind it.

The United States' hasty declaration of war against Britain was also a result of Spain's intervention. Under these circumstances, Spain received the largest share of British reparations, and the other Allied powers had no objections.

Even France had no objections, after all, without Spain, France, having lost Russia as a crucial ally, would never have won the world war. After Spain, France received the second-largest share of war reparations. Of course, France couldn't possibly have monopolized nearly a third of the reparations like Spain.

France also received a substantial share of the reparations, amounting to 24.1%. This was in consideration of the French fleet's contribution to the naval battle and the fact that France did not acquire many British colonies. Therefore, France was compensated to some extent in terms of the reparations.

Based on the current exchange rate between the pound and the peseta, France will receive a total of 46.3684 billion pesetas in war reparations, equivalent to nearly two years of France's total fiscal revenue before the war, which is a considerable amount of compensation for the French government.

Following France, Russia and Italy received 15.7% and 11.9% of the reparations, respectively.

The combined reparations paid by Russia and Italy were roughly equivalent to those paid by France. This was partly because Russia and Italy had made relatively little contribution to the war against Britain, and partly because their overall strength was not yet strong enough to warrant much consideration of their opinions.

Even the fact that Russia was able to receive 15.7% of the reparations was only because Spain and France considered Russia's enormous contributions to the World Wars during the Tsarist era, thus providing some compensation to present-day Russia.

If we only consider the contributions of the current Russian provisional government, the proportion of reparations Russia can receive is even less than that of Italy.

Apart from the four major Allied powers, the combined share of other small and medium-sized countries was only 17%.

Although it was only equivalent to the proportion of reparations received by Russia, a 17% share would still amount to 32.708 billion pesetas, which was equivalent to Spain's total fiscal revenue for a year and a half before the war. For the remaining small and medium-sized Allied countries, it was actually a huge sum of money.

Since the United States did not sign a peace agreement, Britain's war reparations naturally have nothing to do with the United States.

Although doing so would completely sever ties between the United States and the Allied Powers, whether the United States was an ally or not was actually not important to Spain, France, and the other Allied Powers.

Carlo wouldn't fight for American interests just for the sake of an ally's name. Even if the US signed a peace agreement, Carlo would try to minimize the reparations the US would receive, in order to guard against American rise.

Because this reparations amounted to Britain's total fiscal revenue for three and a half years before the war, it was extremely difficult for Britain to repay this war reparations.

To allow Britain sufficient time to pay the indemnity, after discussions among the Allied powers, it was ultimately decided that the total indemnity of 192.4 billion pesetas would be divided into two parts, with approximately 50 billion pesetas to be exchanged for other important resources such as industrial products, mineral materials, and food.

The remaining 142.4 billion pesetas in compensation must be paid in pounds sterling, gold, or pesetas.

The British government was required to pay one-third of the total reparations to the Allied Powers within one year, and the Allied Powers would then divide this one-third of the reparations according to their respective proportions.

The remaining two-thirds of the compensation will be paid out in installments of one-tenth each year for the next ten years, until the compensation is fully paid.

For a severely weakened Britain, extending the £7.5 million in reparations payment over ten years would make the payment much easier.

After all, Britain's various colonies could bring in enormous wealth, and compared with the military expenses invested in continuing the war, this war reparations were just a drop in the bucket.

Furthermore, Britain had already made a considerable amount of money by selling goods to the Allied powers before joining the war, so even after paying the reparations, it would not have a significant impact on Britain's finances.

After the peace agreement was signed, Britain breathed a sigh of relief, as did the Allied Powers.

Although Germany was still not resolved, it was unlikely that Germany, alone, could pose a significant threat to the Allied powers, even if it fought desperately.

Even after signing a peace agreement with Britain, France and other Allied countries began discussing how to deal with Germany.

Although the British reparations amount to a staggering £7.5 million, Germany's reparations will undoubtedly be even higher in future peace negotiations with the UK.

Germany would pay an even heavier price. In addition to huge reparations, its territory would be torn apart. France would absolutely not allow postwar Germany to retain the strength of a superpower.

The Allied Powers, which bordered Germany, were able to carve up portions of German territory. Even Spain, a country not bordering Germany, was able to seize German factories, industrial equipment, and means of production, squeezing every last drop of value from Germany.

Of course, Carlo was more interested in the German skilled workers and scientists than in the factory equipment.

Spain also reached an agreement with France on this matter, with Spain relinquishing its claim to Germany's High Seas Fleet in exchange for France making concessions on personnel.

Spain will have priority access to all of Germany's technical and scientific talent, and this talent pool from Germany will further enrich Spain's talent pool.

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(End of this chapter)