African Entrepreneurship Records 2

Chapter 961 Crisis and Opportunity

Of course, the United States is also aware of this problem, so now the United States has picked up the script of Britain’s "free trade" and vigorously developed its naval strength.

Historically, the United States launched the so-called "Open Door Policy" in September of this year, demanding more opportunities for "fair competition."

East Africa has not yet developed to the stage of the United States, but with the development of East Africa's industry, it will not be many years before East Africa will support the US's proposition.

After all, today's world rules are set by traditional European powers such as Britain and France. Other countries are more willing to break this old world system, and East Africa is no exception.

"We need to continue to increase diplomatic, cultural and political exchanges with South American countries, especially to support our agents. Today, the international market has been almost divided up, and if we want to take more, it means that someone will give up their interests, which is obviously not easy to do. So we can only continue to work hard, open up more new tracks, avoid direct competition, or improve our industrial standards and increase the competitiveness of our products." Ernst said.

A good blacksmith must have strong tools himself. If the industrial level of East Africa is further improved, the industrial products of East Africa will be able to compete head-on with those of other countries. In the end, it will depend on who has stronger industrial strength. Once the industrial level is improved, it will naturally drive the development of other fields.

Just like the United States, its foreign policy change was also due to the rapid expansion of its industry. Industrial development has driven the enhancement of American strength, which is the prerequisite for the development of the US Navy today and the guarantee of victory in the Spanish-American War.

Today, East African industry has not yet grown in quantity and naturally cannot be compared with other powers. However, as time goes by, East African industry will enter a new period of explosive growth.

By 1899, the previous industrial reforms in East Africa were basically completed, and a large number of new factories were built in the east, central and western regions, and the north and south also achieved industrial development from scratch.

In the central and eastern regions of East Africa, a number of emerging industries are growing rapidly, and the electricity, machinery, petroleum, chemical and machinery industries have achieved leapfrog development.

In particular, industries such as electricity and automobiles have not only grown in scale, but have also accumulated a large number of technological advantages. As time goes by, East Africa will have a huge competitive advantage in the market for these industries in the next 20 to 30 years.

At the same time, this also means that by 1899, the previous round of industrial investment in East Africa had been completed, and the subsequent process was the process of recovery of industrial investment in East Africa.

This is also the main reason why East Africa is actively developing new consumer markets such as South America. After all, after industrial products are produced, it is impossible for them to be consumed only by the domestic market in East Africa. The international market is even more important.

As for the international market, after excluding the colonies and spheres of influence of various countries, there are not many regions and countries for East Africa to choose from. South America is also the only region that East Africa has not yet entered on a large scale.

Ernst said: "In terms of exports, our main markets are now Europe, the Far East and the Middle East. Europe is the main market for East African industrial and agricultural products, while the Far East and the Middle East are advantageous markets. On this basis, South America will be the fourth largest market for East African trade in the future."

"For the development of new markets, the most important thing is to bind interests, so that we can achieve certain breakthroughs in the current environment of high tariff barriers."

According to Ernst's memory, there were several economic crises in the early 20th century in his previous life, especially the economic crisis in 1913, which directly led to the outbreak of World War.

Therefore, throughout the early 20th century, competition in the industrial field will only become more and more fierce, but the impact on East Africa should not be significant. On the one hand, East Africa’s domestic market has not yet been saturated. As an agricultural country, East Africa’s domestic market demand is relatively strong.

Just like tractors, power equipment, cars, etc., East Africa currently produces and sells more products than exports, and these industries rely on emerging industries, which are much more capable of coping with economic crises than traditional industries. In the previous round of industrial investment in East Africa, an industrial upgrade has been completed, eliminating most of the backward production capacity. In the context of other countries' vigorous military expansion, East Africa has invested more funds in technology and equipment upgrades, scientific research, education and other fields, which has taken advantage of itself.

Of course, this does not mean that the path chosen by other countries is wrong. If they can occupy more colonies and markets by expanding their military, they can naturally deal with economic risks.

But Ernst is not optimistic about this path. At least at the current stage, military expansion will do more harm than good to national development.

At present, the strength of various powerful countries is relatively balanced, which makes it difficult for countries to make up their minds to go to war. Without war, there is naturally no way to redistribute the cake. Of course, the Spanish-American War should be an exception, but Cuba and the Philippines acquired by the United States are not large in size, which is just a drop in the bucket for the United States.

This is the same as East Africa's purchase of Mindanao. Mindanao has a small population and cannot be effectively developed, so East Africa cannot obtain any income from Mindanao for the time being.

Moreover, equipment technology is currently in a period of rapid iteration, especially the navy. The expansion of the US Navy is actually a buy early and enjoy early approach, while Ernst's naval development route is to buy late and enjoy discounts. Before the appearance of the dreadnought, the East African Navy did not plan to expand the number of warships on a large scale in the past four or five years.

In Ernst's view, in the next few years, until 1905, the focus of the development of East African countries should be to vigorously develop the economy, especially to enhance East Africa's industrial strength. After 1905, it would not be too late to consider changes in the international situation and formulate a development strategy for East Africa.

Of course, the frequent economic crises in the early 20th century were indeed worthy of Ernst's vigilance. Although history has changed a lot, the general trend of world economic development should remain unchanged. We must prevent the economic crises of other countries from being transmitted to East Africa and disrupting East Africa's layout.

Of course, this worry is somewhat unnecessary. Other countries may only have high tariff barriers, and except for coastal cities, most areas in East Africa are still closed.

With this firewall in place, even if the economic crisis does affect East Africa, it will only have an impact on the economies of coastal areas.

Moreover, the economic crisis is not a bad thing for East Africa at present. The crisis also represents opportunities, which will also be more conducive to East Africa obtaining advanced technology and equipment from other countries.

Although East Africa itself has many industrial highlights, they are limited to emerging industries. The gap in traditional industries with other countries is still difficult to bridge, and the economic crisis is an opportunity for East Africa.

Of course, the introduction of technology and equipment to East Africa today is very different from that in the 1970s. During the economic crisis in the 1970s, East Africa mainly solved the problem of creating something from scratch, while the most important thing for East Africa in the new century is to make up for the shortcomings of East Africa's industry and to fill the gaps in East Africa's industrial system. There is a big difference between the two.

However, this also made Ernst quite regretful, that is, in the early 20th century, East Africa could not play the role of the former Soviet Union. Although the economic system of East Africa had some similarities with that of the Soviet Union, East Africa had already invested funds in industrial development in advance.

However, this is not a bad thing. The Soviet Union did achieve rapid industrialization during the economic crisis in the 1930s and enjoyed the dividends of the economic crisis in Europe and the United States. Although it was also a shock to the Soviet Union's own industry and scientific research, it could be avoided if the right degree was struck.

In comparison, East Africa has taken a completely different route. After all, Ernst has always been pursuing steady and solid progress. In Ernst's view, allowing East Africa's industry to expand rapidly in a short period of time may not be a good thing. Otherwise, the excavation of gold mines in Hechingen Province can solve the funding needs of East Africa's industrial development.

(End of this chapter)