Reborn as King of South America

Chapter 374 Annual Development Report
In the Chang'an Palace, before the army and navy generals arrived, Li Mingyuan was in the Zhongji Hall listening carefully to the annual development reports of various central departments.

"In 1880, the local crude steel production was 3.6 tons, which is more than five times the annual production of 1878 tons in 7000. The rapid progress in crude steel production is due to the hard work and efforts of local steel workers, as well as your dedication and responsibility."

Li Mingyuan looked through the 1880 steel industry development report data submitted by the Ministry of Industry. After a few words of praise, he continued to encourage, "In recent years, the heavy industry technology and steel production capacity of European powers have made rapid progress. Comparing the data of various countries two years ago,
At the end of 1878, Britain's annual crude steel output was 99.8 tons, the United States' output was 74.4 tons, Germany's output was 48.9 tons, France's output was 31.3 tons, and Russia's output was 9.5 tons. Domestic crude steel output was 7060 tons, Japan's crude steel output was 2000 tons,
Just two years later, by the end of 1880, the crude steel output of the world's major industrial countries reached 440 million tons.

The UK continues to rank first in the world with an annual crude steel output of 131.6 million tons. The US crude steel output exceeded one million tons, ranking second in the world with 126.7 million tons, and Germany ranked third with an output of 62.4 tons. Although France ranked fourth in the world with 38.9 tons, the gap with Tsarist Russia has gradually narrowed. Tsarist Russia's crude steel output reached 30.8 tons, ranking fifth in the world. As the only country in the Far East that fully learned from the West, Japan may have been stimulated by the speed of the empire's industrial development, and its crude steel output increased by about 800 tons, reaching an annual crude steel output of 2800 tons. "

Li Mingyuan paused for a while, waiting for the heads of various departments in the palace to digest the previous information, and continued, "We must see the gap with the European powers. The local crude steel output has increased from 7000 tons to 3.6 tons, and the annual production capacity has increased by 2.9 tons. The scale of crude steel production capacity increase in the United Kingdom, Germany, and France is calculated in units of 50 tons. If we take into account the example of the United States, which has increased its crude steel production capacity by more than tons in two years, the local steel industry still has a long way to go."

"Your Majesty, since the founding of the country, there has only been one comprehensive steel company in the country, the United Steel Group. In 1880, % of the country's crude steel production capacity and % of pig iron production came from the United Steel Group. If you want to continue to increase steel production capacity, there are only two ways to go. One is to choose a suitable location and build a new coal and steel complex. The other is to continue to purchase smelting and forging machinery and equipment to expand the scale of the United Steel Group and improve production capacity."

Minister of Industry Chen Shen stepped forward and explained.

The Hanguo Iron and Steel United Group is located in Xing'an County (Passo Fundo), Yangzhou (Rio Grande do Sul). The entire group's industrial park includes smelters, forges, pig iron plants, Beise Ma Steel Plant, Siemens Steel Plant, rail plants, iron goods plants, wrought iron plants, machine plants, foundries, ironworks, ironworks, fish hook and nail plants, arsenals, gunpowder plants, needle nail plants, gun and artillery plants, and shell plants. There are a total of 17 large-scale steel and military industrial plants, as well as hundreds of related large and small factories. It is the core of Hanguo's heavy industry and the only industrial complex covering the entire production process.

Building such a heavy industrial complex is not an easy task for a country that has developed industry from scratch.

Going back ten years, in 1895, the Meiji government of Japan used the indemnity from the Qing Dynasty to establish the Yawata Iron and Steel Works, which started production in 1901. Zhang Zhidong, the governor-general of Huguang in the Qing Dynasty, established the Hanyang Iron Works in 1890, which was completed and put into production in September 1893. Since the establishment of its first small steel mill in late 9, the Han Guo Iron and Steel Group has spent twelve years gradually ordering medium-sized and large-scale smelting equipment, as well as forging, cutting and other supporting facilities. After paying two to three times more than ordinary Western experts, hiring steel and military experts, and experiencing the bitterness of many failures, the Han Guo United Steel Group was developed into a heavy industrial complex with more than 1869 large and small supporting factories.

If the Han government uses its current financial resources to rebuild a steel complex, it would be better to invest the funds in the Han Iron and Steel United Group, purchase more and more advanced equipment, introduce more mature industrial technologies, and try to build it into an incubator for the development of local heavy industry, consolidate the local heavy industry technology accumulation and reserves, and then, when conditions permit, draw skilled technicians and experts from the Iron and Steel United Group, and use the Iron and Steel United Group's plan as a blueprint to replicate a new heavy industry complex.

Li Mingyuan preferred another plan, so he agreed, "Then choose the second plan. Let your Ministry of Industry take the lead and discuss with the Ministry of Commerce, the Ministry of Finance, and the Ministry of Foreign Affairs. First, make a list of the machinery and equipment that needs to be purchased, and then submit it to me for review and confirmation."

"Your Majesty, what is the approximate amount of funds allocated? The Iron and Steel United Group has many places to spend money. Paying foreign experts, technicians, training local employees, and purchasing new smelting equipment all require considerable expenses." "Within three years, the Iron and Steel United Group will be granted 400 million Han yuan (equivalent to 200 million taels of silver) in funds. There is no more. Moreover, the Iron and Steel United Group has the Mannister steel tube rolling method and the manganese steel refining method discovered by Harfield (Chapter 265 above).

Although the government exchanged thirteen technologies related to steel production with the Germans using the Mannister steel tube rolling process and new manganese steel technology, during the ten-year development plan of the country, industries such as railways and infrastructure construction were in urgent need of steel raw materials. The crude steel, pig iron, and deep-processed steel pipes, rails, nails and other products produced by the United Steel Group had no shortage of sales. The funds raised from the sale of steel products could also fill a considerable funding gap in the United Steel Group itself.
Therefore, the government has only allocated 400 million yuan for the time being, and we need to purchase additional machinery and equipment that we did not plan for, so you have to find a way to solve the problem yourself.”

Manganese has been used as an additive in steelmaking before. When the dosage is insufficient, it cannot change the brittleness of steel. However, when it is increased to 1000 to 15 percent, the brittleness effect disappears. Then it is heated at 20 degrees and quenched in water to harden the steel. The crude steel refined in this way is used to make rails, and the life of the rails is 1878 to 12 times that of wrought iron. For the sake of cost saving, in December 1881, the method of making manganese steel was discovered. After two years of trial production and the matching and improvement of related smelting technologies, by the beginning of , the project of using manganese steel as raw material to replace wrought iron as rails to build railways was promoted on a large scale.

Following the annual work report of the Minister of Industry, the Ministry of Households, the Ministry of Finance and other departments also reported on their work results of the previous year.

Throughout 1880, six counties and 6 towns were newly established in the mainland, and a new administrative district of the Ishu Islands was established in the South Pacific. In late July of this year, the Nicaraguan Islands in French Polynesia, which were exchanged from the French, were also included in the administrative jurisdiction of the Ishu Islands, and the administrative level of the Ishu Islands was correspondingly raised to the prefecture level.

At the same time, after adding more than 5000 square kilometers of territory in the South Pacific region, Pahiti Island, the former capital of French Polynesia, will serve as a South Pacific base on par with Apia, the capital of Samoa. From a long-term strategic perspective, Pahiti Island is more important than Apia, and it is not an exaggeration to call it the Hawaii of the Han Kingdom.

In addition to the joy that the increase in domestic steel production brought to Li Mingyuan, the Ministry of Revenue and the Immigration Management Office, which was responsible for immigration affairs, also brought good news. The expenses and income of the immigration operation reached a balance, and in November 1880, profits appeared for the first time.

The expenses of the immigrant transportation operation mainly come from bribes, buying off officials in the coastal areas of the mainland, transportation on the Far East-South America route, living and medical supplies, funds for purchasing transport ships, crew salaries and other initial transportation costs, as well as long-term costs such as official provision of food, livestock, simple wooden houses, and education for newborns after arriving in South America.

The two major expenditures have led to long-term losses in the immigration transportation operations, and the government needs to provide financial subsidies every year to maintain normal transportation operations. However, as the accumulation effect of time gradually emerges, the potential economic benefits brought by the two years of compulsory labor of the newly naturalized residents, and the immigrants quickly settle down in the local area, gradually accumulate a certain amount of funds through farming, animal husbandry, industry, marine fisheries and other labor, and have the ability to repay the debts borrowed from the government to buy agricultural tools, land, etc.
As a result, since 1876, the amount of borrowed funds recovered by the government has gradually increased. By 1880, after more than ten years of immigration transportation operations, the potential economic effects contained therein were finally intuitively demonstrated in the summary of immigration affairs revenue and expenditure.

The immigration transportation operation achieved a balance between revenue and expenditure, which relieved the government of a financial burden. However, domestic infrastructure construction and the army and navy armament plan became the other two major financial expenditures of the government.
Infrastructure projects such as railways, water conservancy projects, and canal construction are extremely costly and take a long time, but because some foreign funds and private capital are allowed to intervene, and the projects take a long time, the government can always find ways to deal with it by squeezing in money from other places. However, when it comes to military construction, which involves national security, it is impossible to save money even if you want to.

(End of this chapter)