Chapter 586: Fraudulent Joint Venture

"Uncle Carl, if you are interested in supporting the future construction of the Northern Railway, I have a best of both worlds solution. It will not delay the construction of other projects in East Africa, but will also enable the extension of the Northern Railway to start construction ahead of schedule, thereby opening up the connection between East Africa and the Chad colony as soon as possible and contributing to the colonial cause of the Sigmaring system." Ernst said.

Prince Karl was indeed interested. He asked, "What is the solution?"

Ernst was not embarrassed and said openly: "Uncle Karl, you also know that railway construction is not difficult. It is nothing more than a matter of money. Just like the United States and Germany before, capitalists built railways crazily and a lot of hot money poured in. Therefore, the railways in these two countries grew blindly and rapidly every year, which eventually led to the economic crisis in 1873."

"Of course I know that, but the economic crisis is over now, and the railway market is back on track. Germany is now developing in a more gradual manner. Before I arrived in East Africa, the crisis had been greatly eased, and society was developing very rapidly."

In fact, the world economy is still in a depression, far worse than before the crisis, but society is constantly developing and it is impossible for it to stagnate. Although Germany's development speed has slowed down a bit, compared with other countries of the same era, it is very optimistic.

Moreover, the older generation like Prince Carl are well-informed. Although the economy developed rapidly before the economic crisis, they knew that this was not the norm.

Ernst went on to say: "So if East Africa wants to build the railway ahead of schedule, it only needs to solve the problem of funds. However, the East African government has spent a lot in recent years, so there is no extra money to support the development of two railways at the same time."

What Ernst said was not wrong. The finances of the East African governments have never been sufficient, but there has never been a government in the world with enough finances to spend.

For example, the fiscal revenue of the East African government in recent years is much stronger than that of most countries in the world. After all, it is the wealth created by 50 million people. The East African government can obtain relatively considerable income just by taxation. In addition, there are a number of state-owned enterprises in East Africa, and these enterprises also have lucrative profits.

Therefore, if East Africa wants to build two railways at the same time, there may be financial pressure, but it is not to the point that it cannot afford it. Instead, it wants to spend the money effectively. The Azande Plateau, which is the extension of the Northern Railway, is not of high value to East Africa at present, so it is not cost-effective to build it. Instead, it would be better to build more branch railways in Matabele Province to make full use of the mineral resources in Matabele Province and develop inland industries.

People like Ernst have an obsession, which is to hope that inland and coastal areas can achieve balanced development. The Far East could not do this in the past, but the national conditions of East Africa and the Far East are different after all.

One is that the climate inland of East Africa is better than that in the coastal areas. For tropical countries like East Africa, the cooler the climate, the more popular they are. Temperate countries prefer warmer areas. This is also an important reason for the population of China, the United States and Russia to migrate southward in later generations.

For example, in the Far Eastern Empire, the population of the northeastern region flowed to the south, and the population of the northeastern region of the United States migrated to the southern "Sunshine Belt", not to mention Russia.

Therefore, the climate advantage of the interior of East Africa is more conducive to the balanced development of various parts of East Africa. Most parts of East Africa have a tropical savannah climate, which is conducive to the balanced distribution of the population.

The second is that the resources in the interior of East Africa are far superior to those in the coastal areas, and the inland resources are rich in variety, especially in Matabele Province and Hechingen Province. The resources in these two provinces can almost meet most industrial needs. The only thing lacking is oil.

However, the two most important oil resource provinces in East Africa are also inland, namely the Nile Province and the Northern Great Lakes Province (Uganda).

The resource conditions in the interior of East Africa make the lower limit of future inland development very high, which can form favorable competition with the coastal areas.

The only advantage that coastal areas have over inland areas is sea transportation, but this advantage is enough. The advantages and disadvantages of both sides are about the same.

However, Prince Carl did not know much about these things. After all, he was only looking at the surface of East Africa. Only Ernst and a few senior East African officials knew the actual development of East Africa.

Prince Karl asked, "So you mean that as long as the funding problem is solved, the construction of the Northern Railway can start ahead of schedule?"

Ernst nodded, his meaning was clear, and he said, "If Sigmaringen can invest a part of it, then we in East Africa can still realize the northern railway extension ahead of schedule by gritting our teeth and tightening our belts."

This put Prince Karl in a very difficult position. If the northern railway extension was to be realized, it would be at least more than a thousand kilometers long. This was not a difficult task for a big country like East Africa, but it would be extremely difficult for Sigmaringen.

Now, a lot of money has been spent just on investing in the Chad colony, but the acquisition of nearly two million square kilometers of land is indeed cost-effective and can be considered a return on investment. However, investing in railways is not a sure thing.

So Prince Karl said with some embarrassment: "Ernst, you also know that we in Sigmaringen are just like you in Hechingen. Although we are great nobles, we don't actually have much money."

This is true. Although great nobles like Hechingen and Sigmaringen are not everywhere in Europe, they are not uncommon. Sigmaringen and Hechingen were both traditional military nobles who developed in the army. Nobles are more about personal connections, military force, power, and social status. As for financial resources, they are not as good as capitalists.

"Uncle Karl, Sigmaringen naturally can't come up with so much money, but Sigmaringen also has Romania. Romania is also a country of varying size, and its energy is no less than that of many countries."

Ernst was targeting Carol I. In fact, Romania today is a purely small and weak country. In its past life, Romania was quite powerful, and it developed after annexing the territory of Hungary.

However, having said that, Romania is much stronger than Sigmaringen, a principality the size of a town, and has many rich people. Carol I, as the monarch of Romania, led Romania to independence from the Ottoman Empire and has a good reputation.

"Although the ruler of Romania is your cousin, it is impossible for our family to control Romania's wealth," said Prince Karl.

Ernst: "I mean issuing bonds in the name of the Romanian royal family. If Sigmaringen wants to develop Chad, it cannot rely solely on its own strength. It must have the support of Romania."

Ernst was well aware of this. If East Africa were to look at the wealth of the original Black Hingen royal family, it would have been lost long ago. The biggest contribution to the colonization of East Africa came from the financial resources of the Black Hingen consortium.

Prince Carl: "The question is how do we pay our debts?"

"This is easy, Uncle Karl. You can't look at problems with the same mindset as before. You now have nearly two million square kilometers of land. There must be a lot of mineral resources in these two million square kilometers of land. You can use the mineral resources to repay your debts. This is why I asked you to invest in the Northern Railway. If you want to sell these minerals, you must rely on the railway. The sooner the Northern Railway extension is completed, the sooner you can get rich with mineral resources. Correspondingly, with mineral resources, you can attract investment and further strengthen colonial construction."

Prince Karl listened carefully to Ernst's words and thought they made sense. Thinking about it this way, the Northern Railway was indeed very important to Sigmaringen, and it seemed very cost-effective to invest in this railway.

(End of this chapter)