The sun. [volume] (New York [N.Y.]) 1833-1916, 1882-10-29
The Financial Side of the Egyptian
Question.

| The Financial Side of the Egyptian
Question.
| 1t is usually taken for granted that the
| Egyptian troubles all grew out OF the enor-
nous debt accumulated by IsMAIL Pasha
and the steps taken by the foreign bondhold-
| ers to compel payment. The action OF the
British Government in reference to future
| arrangements for meeting the interest on
this indebtedness will probably depend upon
the answer to two questions: First,
whether Egypt ought to assume the
late Khedive's obligations; and Sec
| ondly, whether she can afford TO do So
According to an English statistician, Mr..
NJ. G. MULHALL. who has made a careful
study OF the fiscal problem, good deal Of
misconception is current on the subject. He
undertakes to show in the Contemporary that
the much-abused IsMAIL expended on public
works more than he ever received from for
eign money lenders. and, further. that IL the
interest on the foreign debt were reduced to
per cent.-a rate quite high enough when
we remember that most OF the loans were
placed at figures much below par value-the
resources Of the Nile country would prove
entirely adequate to sustain its burdens
| The first remarkable fact brought out by
Mr.. MULHALL is the actual amount received
by the Egyptian sovereigns from their for
eign loans. The whole amount of the debt
now charged upon the public revenues, or
resting by way of mortgage on the private
estates Of the khedival family, Is about $780,
100000. The net sum, however, obtained by
the three Khedives by whom the debt was
contracted-SAID, IsMAIL, and TEwFIK-has
not exceeded 1852 SOC. 900, OF which s2lO, 100000
lppt tn Should II
fore, be determined to pay hereafter
only three per cent. ON the par
value of the whole debt, it is clear
that the Egyptian Government would really
be paying six per cent. ON all the money that
ever came into its hands. But ought foreign
powers it may be asked. to insist on making
| the toling masses Of the Egyptian people
! accountable for the huge sums which, ac-
cording to the prevailing impression, were
wasted by autocratic rulers in extravaganza
and sensuality? Mr.. MULHALL shows that
there is moral obligation ON the Egyptian
| people to assume at least SO much Of the
| debt as would represent the money actually
advanced, for the reason that these funds
were not squandered, as is imagined, but
were nearly all devoted to useful and pro-
ductive public improvements.
This unexpected conclusion is reached by
an analysis Of the sums expended by IsMAIL
on public works from his accession in 1868 to
his deposition in 1879. Among the items are
| $63,0O000O for s,4OO miles Of canals, added to
the Nile irrigation system, more than
ST. 900 900 for $40 miles OF railway and $500
miles Of telegraph, and upward Of $30,0O0,-
900 for bridges, docks, and harbors. That
| these figures are the results Of careful esti-
mates, and are not simply copied from the
| khedive's books, is atteSted by the method OF
dealing with the item of outlay on account Of
the Suez Canal. IsMAIL had credited himself
with expanding 900 on the canal, but
Mr.. MULHALL demonstrates that after nee
essary deductions, including the sum re-
ceived from the British Government for the
Khedive's shares, the precise amount dis
bursed by IsMAIL for this purpose was $685.
S5O,OOO. Apropos Of the Nile canals, we may
point out that Mr.. MULHALL does not esti-
mate the value of the Corvee labor, but
merely takes into account the cost OF the
food which the Khedive had to provide for
| the laborers. The money actually laid
| out on public works by IsMAIL Tex
elusive OF palaces and thcatres) during
| his reign of sixteen years amounted
to 1921, 300, 000 or more than $40, 100000 in eX-
cess OF the sum which he received from Euro
pean money lenders. 1t is true that he often
paid more for public works than they were
| worth, for European contractors were not
whit behind European bankers in their
eagerness to spoil the Egyptians. The for
mer sometimes charged 80 per cent. extra for
risks, just as the latter In some cases eX-
torted % per cent. interest. Decisive proof,
however. of the benefit accruing to Egypt
| from these public works, is furnished by the
facts that during the reign OF lSMAIL the
number OF acres titled increased from 4,052
600 to 5,425, 900, and the value of exports from
$22,27O,OOO to sos, 100000.
That Egypt would be able to pay per
cent. on her funded debt seems evident from
her fiscal record in the year 1884, when. al
though part of the bondhoders received
per cent. interest, and the rest 4 per cent,
there remained IA surplus Of 81 100000 after
defraying all the cost of the civil and military
administration. 1t is true that the land tax,
which furnishes iive-eighths of the receipts,
averaged in that year So per acre on all the
| arabic territory Il rate which might have to
be reduced one-fourth in times of drought or
excessive flood. But the proper allowance
for bad years could be more than offset by
| 'ultihH doWH lllt VI OH llt
whole debt to per cent. This rate, as we
| have said, would be reasonable return for
the sums actually invested by the bondhold-
ers, provided, of course, the risk of total loss
through Egyptian misgovernment could be
averted. II such Il curtailment in the outlay
for interest could be effected, and il the an
nual tribute to the Sultan, amounting to
S3,5OOO00, could be abolished, the public rev.
enucs OF Egypt would, even in bad years,
and without excessive taxation, yield an
ample surplus for public works and the en-
largement OF the cultivable area by the
reclamation of land from the desert.
Summing up the result Of his interesting
researches, Mr.. MULHALL submits that Is
MAIL Pasha was not 50 black as the bond
holders painted him, and that the Egyptian
people are morally bound to pay at least one.