Persian Empire 1845

Chapter 21 Mercantilism
Naser al-Din led his army toward Mazandran, and all came to witness the spectacle.

The army was unified, with uniform weapons and uniforms, unlike any army before it. The governor rode in the middle on horseback, with his honor guard in front of him.

This was Nasser al-Din's first inspection tour of the province, so he brought a legion with him. Amir and the entire government saw the governor off at the city gate.

"Speaking of which, when was the last time the governor went on a trip?"

"It must have been 22 years ago. Time flies. Back then, the Crown Prince led the army to fight against Russia, but due to the disparity in strength, he ceded Nakhchivan."

Speaking of the previous Russo-Polish War, they ceded a large amount of land to Russia. When will this humiliation be washed away? They have made all preparations to reclaim their lost territory.

"Now we just have to wait. New things have been coming here since last year. They need time to change this place, but we don't know if we'll live to see it."

Amir overheard the conversation between the two people beside him. Yes, when will he be able to take revenge? Looking at the changes in Tabriz, it should be coming soon.

Before leaving, the governor granted him considerable power, allowing him to continue his reforms. Upon returning to the governor's residence, however, he found himself burdened with a mountain of tasks.

The local industrial situation is currently very good, but raw materials, markets, and capital have become bottlenecks restricting their development. Despite the help from banks and the government, development is still progressing with great difficulty.

The establishment of the Industrial Confederation provided further support for the development of modern factories. Soon after, the Confederation's newspaper was published, detailing the state of Western industry and encouraging factory development. Of course, it also promoted mercantilist ideas.

Mercantilism was an economic doctrine and policy system representing the interests of the commercial bourgeoisie during the period of primitive accumulation of capitalism in Europe. Its development can be roughly divided into two stages. The early mercantilist stage lasted from approximately the 15th to the mid-16th century. Mercantilism during this period advocated the use of administrative means to prohibit the export of currency and increase the import of gold and silver. In foreign trade, it followed the principle of buying less and selling more in order to obtain more gold and silver and achieve the goal of accumulating monetary wealth. Therefore, mercantilism during this period is called "monetism" or "monetism".

The late mercantilist phase, roughly from the second half of the 16th century to the mid-17th century, advocated for industrial development, expanding foreign trade surpluses, and ensuring a large influx of currency to accumulate wealth. This period is known as "heavy industrialism" or "trade surplus theory." A common thread between these two phases of mercantilism is the use of currency as a standard for measuring a nation's wealth.

Influenced by Western mercantilism, the Federation proposed the idea of ​​"national prosperity through trade." It encouraged people to invest in industry and commerce to make the country wealthy and themselves rich, thus making the country strong.

They also targeted Russia and the Ottoman Empire, claiming that Russia imported tens of millions of Persian goods annually, causing the bankruptcy of handicrafts throughout the country. Shiraz, once renowned for its exquisite textiles, had lost its former glory. Isfahan, the central economic center, was reduced to less than 100,000 people, all due to the devastation brought by Russian goods.

As for the Ottomans, Persia had always maintained friendly relations with them, but a few days ago the Ottomans suddenly expelled hundreds of Persian merchants. They were afraid; they feared Persia would seize their profits. Persia needed to become strong, and the first step to that strength was developing industry.

"Sir, Mr. Lawrence has arrived." "Let him in."

Lawrence came to see Amir with good news, and he smiled as he reported to Amir on the bank's situation over the past few months.

"Sir, since the bank opened, more than 5000 people have opened accounts here, with deposits of 178 million and loans of 55."

Amir was taken aback by the sight of over a million Tumans in savings. "I didn't think Tabriz had that much money?"

"Sir, you underestimate the citizens. Their savings are very substantial. With just one institution, they can deposit their money, and little by little, they can accumulate a large sum of money."

This money formed the foundation for the bank's development, but to continue expanding, it needed to establish branches elsewhere. The Ardabil region was their target.

The railway project is now underway, with route surveys being conducted and rails, locomotives, and factory equipment being imported from Britain. If the timeline remains unchanged, it should be operational in approximately two to three years.

"Russia is exporting less and less here every year, and they are starting to get worried."

Hearing Amir say this, Lawrence said, “My lord, there is no need to worry about Russia. As far as I know, the Russians are just a bunch of semi-civilized barbarians. They only maintain their status quo because of their wise rulers, and their best commodities are things like wheat and wool. Once industry develops, they can be easily overthrown.”

Russia's situation was similar: a semi-colony disguised as a great power. They exported mostly agricultural products and primary processed goods to Europe, while importing primarily industrial goods. The existence of serfdom constrained their development, but more importantly, they lacked technology and capital. France was a major investor in them.

During the reign of Alexander III, a period of great pride for later generations, the Russian Empire experienced rapid economic development. Coal mining increased by 110%, oil production by 1468%, steelmaking by 159%, and pig iron forging by 487%. The Russian Empire's wheat and grain production reached 15% of the world's total grain output.
Rye production reached 55% of the world's total, and national revenue increased ninefold. In contrast, during the same period, Britain's GDP only increased 2.5 times and France's 2.6 times.

However, these achievements were all built on excessive foreign investment. Foreign capital controlled one-third of Russia's textile industry, 60% of its machinery manufacturing, and 99% of its oil extraction. In an effort to develop its economy, Russia accelerated its expansion, waging several wars and seizing considerable territory, all in an attempt to salvage its industry through government contracts.

"Thank you for your kind words. I hope you can provide 35 yuan in railway funding, which is a significant boost to the railway."

"Don't worry, sir, I'm already making preparations."

(End of this chapter)