Persian Empire 1845

Chapter 25 Tabriz (Part Two)
Upon arriving at Abbas Street, the merchants finally understood why they had come here: there were two new buildings, one called the Tabriz Bank and the other the Industrial Federation.

“O Allah, what is this?” a merchant asked.

"Why don't we just go in and take a look? We'll be here for a week anyway, so if we can find new opportunities, that would be good news for the business."

Everyone agreed to the suggestion, and they went to check out the Tabriz Bank. Upon entering, they saw many people with money at the counter, realizing that this was where loans were made.

Hello, how can I help you?

A person in a blue uniform walked over and asked them what they needed.

"Oh, it's like this. This is our first time here. Could you tell us what this place is for?"

"Okay, no problem. This is Tabriz Bank, which deals in deposits, loans, and other services..." The employee has faced many customers like this, saying the same things every day to educate them. He enjoys it, but his mouth gets cramped from talking so much.

Hearing these words, the merchants completely shed the label of this place as a loan sharking den. They could hardly believe they could deposit money here.

"Can you really deposit money here?"

"Yes, simply put, the bank can help you keep your money safe, and you can withdraw it when you need it, which will give you peace of mind."

Also, if you urgently need money, you can come here to apply for a loan. The specific amount will need to be negotiated in person, but rest assured, this loan service is different from other loans; the interest rate here will not exceed 10%.

10%? They couldn't believe it. In Gazvin, 15% to 25% was the norm, and some even reached as high as 45%. Theirs was so low. Had the governor had a change of heart?
Just as they were about to continue asking questions, a European in a black uniform came into the hall. There was a platform in the center of the hall. He stood on it and spoke in Persian.

"Ladies and gentlemen, I am Lawrence, the manager of Tabriz Bank. I'm sure you all recognize me. The bank has decided to issue a batch of bonds. If you wish to purchase them, please go to the counter to complete the transaction."

Well, that's great. They hadn't even finished digesting the new information they had just heard, and now they were bombarded with even more. But they did inquire about who had been standing on the platform earlier.

“That’s Mr. Lawrence, the manager of our bank. The governor started this bank on his advice. The Ayatollahs were against it, but things turned out surprisingly well, so they acquiesced.”

Now they were really eager to try it out. No matter what, they decided to give it a shot and each of them deposited 30 Tumans into it to see how things went.

After telling the person behind the counter their requests, each of them received a small booklet, which served as proof of their deposits. It would show the amount and date printed on it, and also had a special stamp to prevent forgery. They also inquired about the bonds Lawrence had mentioned. It turned out to be a way to make money; by purchasing a certain amount of bonds, one could earn interest annually and then withdraw the principal from the bank at maturity.

Previously, Tabriz Bank issued bonds worth 15 riyals with an annual interest rate of 3%. Because it was their first issuance, it took two months for the local population to accept this novelty. When the interest actually entered their pockets, everyone went wild, hoping to buy more bonds and eagerly awaiting the latest news. And now, the opportunity has arrived.

The bonds issued by the bank this time are government economic development bonds, totaling 100 million riyals. This is a special fund that Amir uses to develop the local economy and transportation. Because taking such a large amount directly from the national treasury would lead to a shortage of funds, they are trying to raise funds by issuing bonds.

This bond has a 5-year term and an annual interest rate of 3.5%. That means if you buy 10000 riyals of bonds, you will receive 1750 riyals in interest and 10,000 riyals of principal after five years.

How could they not participate in such a good deal that offered free money? However, they were still a little uneasy, so in the end, the leader bought 2000 riyals worth of bonds and decided to wait and see how things went in five years.

This bank was a huge shock to them; they hadn't expected interest rates to be so low. And the fact that bonds could actually generate profits was simply unbelievable.

"It seems we should come here more often in the future, otherwise we'll be too isolated in Gazvin."

“I’m tempted to settle here, but I don’t know when that will happen. Every year I travel from Tabriz to Qazvin just to earn money to support my family. Now, not only do we encounter bandits and checkpoints on the road, but we also have to compete with foreign merchants. They only need to pay taxes once, but we have to ask for them several times. It’s unheard of.”

The merchants complained about the state of the world, but the more they talked, the more they felt this place was wonderful. After leaving the bank, they went to the Industrial Federation building, which was also very crowded, but it was mostly filled with exhibitions and a stack of newspapers and magazines that could be picked up at any time.

On the wall hung an introduction that read: "The world today is an industrial world. Britain, France, Prussia, and other Western countries all prioritize industrial development. Even Russia and the Ottoman Empire have begun building factories. Iran must not lag behind. With each factory built, a piece of national power will be regained. When industry develops, it will be the day Iran washes away its humiliation."

The bold claims on these exhibits are sure to impress visitors. The exhibits are also representative, such as the spinning jenny from England, which is described as being more than eight times more efficient than a human spinning wheel. There's also the steam engine, which claims to have dramatically increased work efficiency by roughly a hundred times.

There were also locomotives, new dyes, and a whole host of other European imports, each of which could bring about revolutionary changes to modern Persia. To join the Industrial Confederation, one had to prove they intended to open a factory, requiring at least 10000 rials to qualify.

Of course, the association will also help you through the initial stages after you start your factory. This includes management training, market analysis, and policy explanations; the rest is up to you to explore.

Currently, the association has very few members, but it has successfully aroused their interest. This is evident from the monthly circulation of its publications: 58 copies in October, 115 in November, and 182 in December. Furthermore, the exhibition hall is packed every day, and more and more people are beginning to discuss the procedures and guidelines for opening a factory. Small workshops are becoming obsolete, and new large factories will dominate the local economy.

(End of this chapter)