Chapter 79: Economic Crisis Outbreak
The economic crisis was already on the horizon. Ferdinand knew that all the Balkan countries were similar and so powerless in the face of the dumping of the Great Powers.
As for the tariff barriers, this thing is really a good cure for the countries with abundant resources and huge markets.
However, this is a full dose of arsenic for small Balkan countries in the 19th century. In Bulgaria, for example, a large part of the raw materials for industry need to be imported for large amounts of foreign income or agricultural exports, which rely heavily on international markets.
Bulgaria is still good, at least in Ferdinand's efforts to lay some industrial base. The biggest capitalist is still Ferdinand himself, followed by the Bulgarian government, which has a chance of not breaking the ground.
The previous food safety law has now become, in turn, a tool to stabilize the market. The domestic food industry is now stable, as the food sold worldwide, at least, is basically unusable for sale on the market.
In the case of Greece and Serbia, the debt is high. Their sovereignty of the country has long been almost mortgaged. The domestic national capitalist class, which has not yet developed, is helpless in the face of the economic crisis.
In the context of history, Ferdinand could not help but guess in bad faith: "Germany's allies in the Balkans, who had almost all jumped back in Great War, were afraid that they were being exploited badly in this economic crisis!"
The first thing that Ferdinand, who was prepared for this, did was to de-stock, and all of its companies began to clear their own goods.
Whether it is three or seven, first these goods are converted into a new logo, which he prepared in advance for the British, French, German, Russian, and Austrian enterprises, and then shipped to the Balkan countries.
Ferdinand now could not care less about profits. It is always important to liquidate first. In an economic crisis, cash is always king.
While on the eve of the economic crisis, Ferdinand placed large quantities of goods on the Ottoman, Romanian, Serbian and Greek markets for each country.
The international capitalists had now begun to dump into the Balkans. It was clear that Ferdinand's sudden blow had exceeded the market's capacity. Then in May 1892, the economic crisis broke out in the Balkans.
Since Ferdinand was prepared for this, and since he was the biggest retailer, the foreign goods were cheaper, but he had to prioritize his own! Of course, it is not to mention the government. Basically, the industry of Ferdinand has a monopoly on purchases in order to protect the local industry, but also to keep using it!
The key is that Bulgaria's large enterprises are not listed companies, and the Bulgarian stock market, is shut down because of too much recession. If the guy wants to snip it, he can't do it!
The media, led by the Bulgarian daily, are promoting the use of national products at their own expense to the public.
It also directly linked employment to the use of national goods. They instilled in everyone that if they all used foreign goods, domestic companies would go bankrupt, and everyone would have to lose their jobs.
The radical point is chanting: if you don't use national products, you are a traitor to your nation's interests.
In addition, in recent years, the government introduced labor laws led by Ferdinand's companies. Since the quality of Bulgarian capitalists has been forced to improve, everyone is doing well.
That's why foreign goods, led by Germany, do not sell well, despite their good quality and low price. It can't be forced if the people don't buy it!
The capitalists can only be forced to shift their attention to other places. As the market in Bulgaria is only that large, it is not a big loss to give up.
After that, the Ottoman Empire became the biggest victim. No way called him the largest pieces. Of course, a country with a market larger than all the small Balkan countries combined is the first target.
First, it attacked the financial markets. The stock market is wailing. Next, it struck the real sector. Luckily, the Ottoman industry is backward. Otherwise, this time, it is not likely to play the game.
It was followed by small countries such as Greece, Serbia, and Romania, which were directly plowed aside by foreign capital, leaving a mess.
If you think this is the end of the story after the withdrawal of foreign capital, on the contrary, it has just begun.
It directly destroyed the infant industries of the Balkan countries. It created a large number of unemployed people. The government revenues fell sharply, and domestic conflicts began to flourish.
Historically, the economic crisis only reached the Balkans in 1893, when it was nearing its end and did not cause as much damage.
Even so, the Balkan countries were wounded. For the next ten years or so, the countries were busy dealing with internal conflicts and regained their strength.
As in how can foreign countries, Ferdinand now has no time to care. However, Bulgaria, the least damaged country in the economic crisis, is also in pain.
The economic crisis broke out in the Balkans at the same time. It hit Bulgaria's exports hard, orders plummeted, and the winter has come for companies involved in making exports.
Even if there is still a Russian market, these small capitalists are not within reach. The Ministry of Industry estimates that if the economic crisis ends at the end of 1892, Bulgarian businesses will be reduced by a fifth. If the economic crisis lasted until the end of 1893, it would reduce the number of Bulgarian businesses by half.
It is pleasant to note that most of these closed businesses are family-owned workshops, small in scale, and have poor management. Even if they occupy half of the number, the total economic volume is less than five percent.
According to the Ministry of Finance estimates, Bulgaria's revenues in the second half of 1892, compared to the same period of the previous year, were to be reduced by a third.
It also meant that in 1892 Bulgaria would face a serious fiscal deficit. The "Second Five-Year Plan" had already started, and all the government's previous loans and the proceeds of the raids were invested, but it was not enough.
The original Bulgarian revenues have grown rapidly and will barely come together in the next few years when all revenues are considered.
Now that the economic crisis has broken out, foreign exports are sluggish and fiscal revenues have fallen sharply. The next few years are going to face a fiscal crisis.
More critically, the "Second Five-Year Plan" can not stop now. Once stopped, the country will have to gain many unemployed people who will be a blow to the recovering Bulgaria.
But now Ferdinand is painful and happy. On the one hand, the Bulgarian state has suffered heavy losses and is facing a financial crisis, causing him, the Knyaz, a headache. On the other hand, he has made a big profit from this economic crisis.
It is not a problem to mention the stock market but also followed by some of the food scraps. However, the times of the stock market are very profitable. He acquired a group of potential businesses whose specific value is difficult to calculate.
Ferdinand was worried about Bulgaria's finances. Franz hurried over and suggested: "Your Highness, we can set up a bank in Bulgaria. After the outbreak of this economic crisis, there was a cash run on the Winston Bank in Hungary. The risk of having other banks is just too great. Moreover, it is convenient to have your own bank for foreign exchange."
Ferdinand's eyes lit up. How could he have forgotten such an important thing?
There is no decent bank in Bulgaria now, except for the Bulgarian National Bank. Most of the financial business is still being done by foreign banks. If one does not step on it, how can one afford the identity of the traversers?
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