Reborn as King of South America

Chapter 187 Naval Competition

ps: Thanks to book friend 2017...205 for the reward and support, as well as all the classmates who voted for monthly tickets and recommendation votes.

After the Paraguayan War, the domestic economy of the Brazilian Empire was sluggish and the national fiscal revenue was tight. Not only did Pedro II not have extra funds to purchase warships, but he also owed the British a large foreign debt. Therefore, he had no choice but to borrow money from the British to purchase ships.

In the evening, Flores, the Minister of Finance in charge of the economy of the Brazilian Empire, arrived at the door of the British Embassy in the Brazilian Empire in a three-wheeled carriage.

The matter of borrowing money from British businessmen was generally handled by Edmund, the Chinese Minister to Brazil. As the head of the Brazilian Empire's finances, Flores had to deal with Edmund. Therefore, the British guards guarding the embassy gate also had an impression of Flores. After seeing him get off the car, they quickly ran into the gate to report.

Flores and his attendant waited outside the door for a few minutes, and then saw a fat man in his forties come out with a smile: "I was busy with work and was unable to greet Count Flores at the door. Please forgive me for my impoliteness."

After the fall of the British Prime Minister, the former Minister to Brazil was dismissed by the new Prime Minister Gladstone for dereliction of duty and replaced by Edmund, who was also from the Liberal Party, as Minister to Brazil and was also responsible for handling Britain's commercial interests in South America.

Edmund was born into a family of emerging capitalists. After entering politics, he had been working in the diplomatic system and had 20 years of diplomatic experience. After arriving in Brazil in mid-February, Edmund changed the arrogant and loose working attitude of his predecessor, and personally visited the main officials and ministers of the Brazilian Empire. Using a gentle and equal attitude, he squeezed out competitors from France, the United States, Prussia, the Netherlands and other countries, enabling British financiers and businessmen to obtain about 70% of Brazil's loan share and a large number of industrial and commercial orders, and won recognition and praise from the London government.

Although he knew that Edmund treated him with courtesy because of his status as the Minister of Finance of the Brazilian Empire, Flores still felt very touched and replied with a smile, "I came here late at night because I had important matters to attend to and could not inform the Minister in advance. I will invite the Minister to meet and apologize next time we meet."

Although Edmund was fat, he was not clumsy in his movements. He took the initiative to greet Flores and the accompanying Brazilian soldiers, and said nonchalantly, "It's late at night and the weather is cold. It's better for the count to go in early. If there is anything important, we can discuss it in detail inside."

As Edmund spoke, he instructed the embassy staff to arrange for Flores and others to enter.

In the hall, the embassy staff brought two cups of cocoa tea and were then sent away by Edmund.

"Is the Count here on the orders of His Majesty Pedro II?" Edmund asked.

"Your Excellency's prediction is correct." Flores took a sip of cocoa tea slowly with the etiquette of a noble, and said in a calm tone: "After the battle of Paraguay, the Imperial Navy lost more than half of its main forces. Two days ago, Rio Grande do Sul purchased two ironclad ships from your country and put them into service. Since then, Rio Grande do Sul's naval power has surpassed that of the Imperial Navy. His Majesty Pedro II is deeply worried about this situation, so he sent me to the embassy to discuss a solution with Your Excellency the Ambassador."

"Flores, as a friend of the Brazilian Empire, I feel very sorry for your country's defeat in the Paraguayan War, but Rio Grande do Sul's purchase of British warships is a normal business transaction. I cannot do anything that damages the interests of the British Empire because of my personal emotional inclinations."

"Your Majesty Pedro II and I both understand the good intentions of the minister. I am not here to interfere with British commercial transactions, but to conduct another transaction with your country on behalf of Your Majesty."

"Count Flores, as far as I know, your country suffered huge losses in the Paraguayan War, and the foreign debt you owe has been postponed for two years. Under such circumstances, can you still use the money for the transaction?"

Edmund asked deliberately.

"Well, the empire's financial deficit is gradually easing, and we will fulfill our promise to pay the foreign debts when they are due. Your Excellency does not need to worry about the Brazilian Empire's ability to pay."

The Brazilian Empire was in debt, and Flores was carrying a heavy responsibility assigned by Pedro II. Even though he felt embarrassed, he had to continue: "The funds in Brazil are mainly used to restore the domestic economy and industrial production. His Majesty Pedro II cannot take out cash to trade with your country for the time being, so His Majesty wants to borrow a loan from your banker again to buy warships to offset the threat of Rio Grande do Sul to our country's seas."

"The difficulties facing the Brazilian Empire are temporary. I believe that under the wise leadership of His Majesty Pedro II, your country will soon overcome the current difficulties."

After understanding Flores's purpose, Edmund's mood immediately improved.

In the late 19th century and early 20th century, if you ask what the great powers like to do most, the first thing that comes to mind is undoubtedly borrowing. The great powers infiltrate the economic field of the borrowing country by exporting funds to the borrowing country. At the same time, they use the conditions attached to the loan itself to control the mineral resources and political trends of the other country, and eventually turn it into a dumping ground for raw materials for their own commercial capitalists, so as to achieve the goal of controlling a country without spending a single soldier.

The Paraguayan War was a battle for interests instigated by the British behind the scenes. Although the joining of Chinese troops in the middle of the war changed the direction of the war and failed to achieve the goal of defeating Lopez Jr., in terms of economic interests, Paraguay, Brazil and Rio Grande do Sul signed a contract, which granted the British the right to navigate and do business on the Paraguay River. This not only achieved the control of the river commercial interests in the La Plata region of South America, but also deepened the penetration of British capital into Brazil.

The Brazilian Empire was rich in mineral resources, and the failure of the Paraguayan War gave the British their first favorable opportunity to infiltrate the Brazilian economy. The current request made by Flores was another great opportunity to further expand Britain's commercial interests in Brazil.

It takes ten years to build an army and a hundred years to build a navy. Developing the navy and engaging in maritime military competition is a very costly activity. The maintenance and installation of supporting weapons after purchasing the ships are also a large expense. Therefore, Edmund will not miss this opportunity. Instead, he plans to take advantage of the favorable opportunity when Pedro II urgently needs ironclad ships to make Brazil pay more for the transfer of economic benefits.

Edmund quickly figured out how to maximize the benefits for the British in the transaction, and then quickly gave the Brazilians the ship purchase plan he had selected.

The first option is to customize a "Monarch" class ironclad ship

The Monarch-class battleship is a first-class ironclad ship with a displacement of 8455 tons. Its main weapons and equipment are: 4 305mm guns, a crew of 430 people, and a price of 40 pounds.

The second option was to purchase two third-class ironclad ships of a similar model to Rio Grande do Sul, with a uniform displacement of 3500 tons, equipped with four 4mm guns, and a single ship price of 228 pounds. A total of 13 pounds was required for the two ships. The price of the two ironclad ships sold by the British to the Chinese was 25 pounds, 26.5 pounds more expensive than the Brazilians. It can be seen here that the British attach much more importance to Brazil than Rio Grande do Sul. However, even if the price was reduced by 1.5 pounds, Flores still gave up the second ship sales plan and chose the first one instead.

From an economic perspective, adding two ironclad ships of the same level would be enough to suppress the novice Rio Grande do Sul Navy. However, Pedro II appreciated the sense of security brought by large cannons and warships, so he directly ordered Flores to purchase large ironclad ships, and small and medium-sized ironclad ships were not considered for the time being.

After choosing the type of warship to buy, Flores directly stated his goal of customizing a "Monarch" class ironclad ship according to Pedro II's order. However, Edmund stopped him at this time: "Your Excellency, I need to remind you in advance that 40 pounds is only the cost of a bare ship. The weapons and equipment installed on the warship need to be calculated separately."

"Your Excellency, when your country trades with the Chinese, you don't charge extra for weapons and equipment. Why should Brazil pay extra money?"

Flores said somewhat dissatisfiedly.

"You misunderstood. If your country purchases ships according to the second plan, the cost of artillery and equipment can be waived. However, the Monarch-class battleship is the main type of battleship newly commissioned by the British Navy. Currently, there is only one ship of this type in the active navy of the Empire. The naval shipyard needs to make improvements to the construction of new warships according to actual needs, so there will be additional expenses."

“How much will the additional cost be?”

"The amount is uncertain, but a warship would cost about 100,000 pounds in total for improvement."

Edmund observed Flores's expression and tried to come up with a reasonable number.

"I'm sorry, Mr. Minister, the warship transaction amount exceeds the maximum authorized price of His Majesty. I need to go back and ask His Majesty for instructions, and then get back to you."

"The Monarch-class battleship is the most advanced ironclad ship in the world. I believe that His Majesty Pedro II will recognize its value." Edmund smiled calmly, without any expression of a failed deal.

"I hope so." Flores was not in a good mood. After saying a polite word, he left quickly.

After Flores left, Edmund's face immediately became solemn. The Monarch-class ironclad ship was a new type of warship that had just been launched in May last year. Its technical performance was not perfect and it had not yet been truly included in the navy sequence. The reason why he listed the Monarch-class as the first ship purchase plan was that he wanted to use the high construction cost of the Monarch-class to repel the Brazilians' intention to purchase ships and instead choose the second ship purchase plan. Unexpectedly, Pedro II traded with the British for the purpose of purchasing giant ships and cannons.

Selling new main battleships to foreign countries was beyond Edmund's authority. In order to avoid the embarrassment of Brazilians actually being willing to pay for the Monarch-class battleships, Edmund quickly used telegram to convey the news to Britain.

Telegraph information from Brazil was transmitted through relay stations set up throughout America and quickly reached the hands of cabinet officials in London.

After receiving the news, the British cabinet officials discussed for half a day and reached a consensus, agreeing to build Monarch-class ironclad ships for Brazil.

Generally speaking, it takes a long time for a democratic government to make a decision on something, but the decision to build new ironclad ships for Brazil was passed efficiently under the impetus of emerging capitalists and naval forces.

Emerging capitalists and industrialists promoted the warship trade, and they were undoubtedly interested in the economic benefits attached to the trade, while the naval faction was motivated by its own economic interests. Because the navy in the steam era had developed too fast due to the rapid development of science and technology, the time for the replacement of ironclad ships was greatly shortened. In the decades since the ironclad ships were built, a new type of ironclad ship would be produced every few years, while the old ironclad ships would be outdated and eliminated after only five or six years. Therefore, in order to save research funds and benefit from helping other countries build warships, accumulating warship construction technology was a more reasonable choice.

Britain was not the first country to choose to do this. A little later, Germany built the Dingyuan and Zhenyuan ships for the Qing Dynasty in this way. Germany experimented with new warship construction technology on the two ships, and the costs of continuous improvements were paid by the Qing Dynasty, resulting in the purchase cost of the two ships continuing to increase, and ultimately the cost exceeded the price of building similar warships by Britain, France and other countries.

It took several days for Britain to transmit the message back and forth. After Edmund received a clear reply from London, the envoys of France, the United States, Prussia and other countries who received the news from other channels took the initiative to visit Pedro II, hoping that they would provide loans and be responsible for the warship transactions.

If it was just Britain, Pedro II would have gritted his teeth and increased the loan amount and agreed to more additional conditions to obtain the Monarch-class ironclad ships. However, after the French and American envoys entered Rio de Janeiro one after another, his mind changed.

Between France and the United States, France was the first country to build ironclad ships, and its naval strength was comparable to that of Britain. However, the loan interest offered by the French was too high, and the additional conditions were no less than those of the British.

The Americans, on the other hand, were much more sincere. Not only did they promise to provide low-interest loans, but they also did not have any harsh political or economic conditions attached. They simply hoped to conduct commercial trade with Brazil in an equal economic partnership.

Britain, France and the United States all had the funds and capabilities to build ironclad ships, but due to various concerns, Pedro II had never made up his mind to make a choice.

Britain and France are the two major hegemons in the current world. Introducing French power will help balance Britain's influence on Brazil, but it may also cause a rift in the relationship between Brazil and Britain. The Americans are rich, but Pedro II does not believe in the Americans' technology in building warships.

After several comparisons, Pedro II found it difficult to make a final choice. During this period, when Edmund met Flores again, the other party hesitated and did not give a clear answer.

The setback in the warship transaction between Brazil and Britain gave confidence to the French and American ministers. While lobbying important Brazilian officials, the two countries' ministers frequently communicated information with their own governments. A competition for the Brazilian industrial and commercial market over the warship transaction unfolded between Britain, France and the United States.

(End of this chapter)