13307

DT
THE
EGYPTIAN PROBLEM
· QENERA!!
JUL 10 ans
BY
J. C: M°COAN, M.P. ****
LONDON
PRINTED BY
SPOTTISWOODE & CO., 30 PARLIAMENT STREET, S.W.
1884
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Price Sixpence
THE
EGYPTIAN PROBLEM
BY
а теа
1827-1904
J. C. MOCOAN, M.P.
: parison
LONDON
PRINTED BY
SPOTTISWOODE & CO., 30 PARLIAMENT STREET, S.W.
1884
T
107
M13
sen habe.
JAN 1 h 1945
THE
EGYPTIAN PROBLEM.
No one who has followed with attention the multitu-
dinous articles and speeches written and delivered on the
Egyptian Question during the past couple of years, can
have failed to be sensible of one feature common to nearly
the whole, namely, that the interests of Party, rather
than historical truth and present fact, have given their
chief colouring to both. Advocacy, rather than judicial
discussion, has been the rôle equally of publicists and
speech-makers; with the result that, while all that can be
said for or against either the late or the present Govern-
ment has been well nigh exhausted, the facts on which an
impartial public judgment must in the last resort be
passed have been largely distorted or suppressed by the
great majority of both writers and speakers on the subject.
If this be so, no apology need be offered for an attempt
to marshal the materials for such a judgment in a spirit
of absolute disregard for Party issues of any kind. I
entertain, indeed, a strong opinion as to the policy
pursued by Her Majesty's Government in Egypt during
the past three years, but in the following pages this
shall be obtruded as little as possible on the reader, and
indisputable facts will be left to tell the story of how
C
A 2
The Egyptian ProblemIV
.
the actual crisis has been developed, and to suggest at
the same time how the problem it presents may best be
solved.
A common mistake is to suppose that the situation
which so seriously embarrasses Mr. Gladstone's Cabinet,
and even threatens to embroil Europe, has wholly
originated within the past five years; while, in fact,
it is the remote outcome of an international blunder
committed nearly half a century ago. Hence much of
the crude and unintelligent criticisin by which the subject
has so often been rather obscured than explained. The
warrant for European interference in Egypt results, it
should be remembered, from neither the Dual Control nor
the special 'interests of this Power or that, but from the
settlement of 1840, by which England, Austria, Prussia
and Russia-chiefly at the instigation of Lord Palmerston
-re-imposed the Turkish yoke on Mehemet Ali, prevented
the establishment of an Arab kingdom round which the
best elements of Eastern civilization would have centred,
and has ever since supplied Western diplomacy with an
excuse for meddling in Egyptian affairs.
. By the end of 1839, Mehemet Ali had made himself
master of Egypt, Crete, Syria, Adana, and the Hedjaz,
and, after the battle of Nezib, Ibrahim Pasha would
again, as in 1832, have carried his victorious standards
through Asia Minor but for the intervention of the four.
Powers, whom jealousy of France, rather than any love
for the Turk, moved to force the rebel Viceroy back into
vassalage for the Nile Valley alone. To the Convention
of 1840, which embodied this disastrous settlement (and
to which France became a party in the following year)
is, therefore, primarily due the right of Europe to inter-
fere in Egypt now. This, to be sure, was inferentially
reaffirmed by the later treaties of Paris and Berlin,
The Egyptian Problem:
lar
guaranteeing the integrity of the Ottoman Empire, of
which Egypt, by diplomatic fiction, is still regarded as a
part; but so many coaches-and-six have already been
driven through both these great Conventions, that neither
can well be said to strengthen the original title derived
from the coalition of 1840–1.
Happily, the weakness of the Porte and the mutual
jealousies of the Powers left Mehemet Ali practically free,
within Egypt and the Soudan, to pursue the vigorous
policy which already, more than ten years before, had
laid the foundations of the most civilized and efficient
administration then or since enjoyed by any Mussul-
man State. During the thirteen years following his
death (in 1849), little was added to these rude begin-
nings of Egyptian national life. The short regency of
Ibrahim Pasha was followed by six years of the volup-
tuary and bigot Abbas, under whose feeble and reac-
tionary rule the prosperity of the country languished; and
the Porte, profiting by his weakness, more than once
stretched its prerogative much beyond the limits of treaty
right. To him, in 1854, succeeded Saïd Pasha (the
third son of Mehemet Ali), an amiable but weak-minded
prince, who retrieved much of the mischief done by his
predecessor, but lacked both the intelligence and force of
character required to give new impulse to the work begun
and so far advanced by his father. To these defects was
also due the dominating influence obtained over him by
foreign-chiefly French_favourites, who pandered to his
vanity and grew rich at the country's expense on con-
tracts and concessions such as have never victimised even
Egypt before or since. Of the latter, the grant to M. de
Lesseps for the Suez Canal is a monumental example,
which-whatever may have been its gain to the trade of
the world—has cost the Egyptian Treasury more than
UL
The Egyptian Problem.
£17,000,000,1 all told, in money only, besides the loss of
a large and increasing transit traffic of great revenue
value. Saïd died in January 1863, and with the acces-
sion of his nephew, Ismail Pasha, the second son of
Ibrahim, the chapter of Egyptian history to which the
events of the past two years may be said to form the
disastrous epilogue began.
Although the chief factors in the problem under con-
sideration are supplied by the reign of this Prince and the
interval since his enforced abdication, there is, it will be
seen, a much more than diplomatic continuity between
those periods and the preceding three-and-twenty years.
During his reign it was that the financial and-out of
them—the political relations of Egypt with Europe, so to
speak, culminated. The firmans of 1866, 1867, and
1873 were all intimately connected with the Western
loans, and, although they largely increased the rank and
authority conceded to Mehemet Ali, having in turn been
endorsed by the Powers, their effect was to further con-
firm the semi-suzerainty of Europe over Egypt. The
sovereignty of the Porte was, of course, the fundamental
in the settlement of 1840, but this had faded
into very shadowy proportions long before the bondholding
interests moved England and France to re-acknowledge
and appeal to it against Ismaïl in 1879. In the mind
both of the Khedive and of the Powers, the only link
which, after 1873, bound Egypt to Turkey was the
nominal seigniory symbolized by the tribute; and on this,
if unproclaimed yet clearly recognised, basis the whole of
the relations between Ismail Pasha and the Western
Governments after that date proceeded. For every
purpose of diplomatic intercourse, these latter negotiated
1 Less the 4,000,0001. recouped by the sale of the Khediye's shares to
the British Government.
The Egyptian Problem.
direct with the Khedive; commercial and other treaties
were settled with him without reference to Constanti-
nople; and it was only when the Stock Exchange and
the Bourse put pressure on Lord Salisbury and M. Wad-
dington that the sovereignty of the Porte was invoked
in favour of the clients of Messrs. Frubling, Oppenheim,
Bischoffsheim, and the other Semitic godfathers of the
Egyptian debt.
Still, differently as the reign of Ismaïl ranks from
those of the Viceroys who preceded him, a close link
with that of Saïd is supplied by the first loan of 1862,
contracted by the latter, and by the large floating debt
which he also bequeathed to his successor. In these
together lay the germ of all the ruinous borrowing
and embarrassments that followed—of the whole problem,
indeed, that now confronts and perplexes Europe. Its
financial factor being, therefore, the main one, the circum-
stances under which this huge load of the Egyptian debt
was incurred claim first and most detailed notice.
The common notion, accepted by both journalists and
politicians, is that, barring the small loan of £3,292,800,
nominal, contracted by Saïd Pasha in 1862, through
Messrs. Fruhling and Goschen, Ismail Pasha, in January
of the following year, found revenue and expenditure
balanced ; and he is, accordingly, debited with the whole
subsequent debt of the country. But the historical fact
is very different. A careful investigation of the Treasury
accounts soon after his accession revealed that, besides
this Fruhling-Goschen loan (which realized only about
£2,500,000 to the borrower) Saïd had further depleted
1 It is right here to give this firm the benefit of Mr. Goschen's repeated
disclaimer in the House of Commons, that they were not themselves the
contractors ’ for any of the three loans which go by their names, but merely
acted for the real contractors, and also that they had no share whatever in
any of the subsequent operations.
The Egyptian Problem.
the Widows and Orphans' Fund, the Minors' Trust, and
several other semi-charitable deposits which Mussulman
law regards as sacred, to an extent which, including
the loan and a large floating debt, handicapped the
new Viceroy with a total starting liability for nearly
£15,000,000. As most of this was due to the charitable
funds mentioned, the recoupment could be deferred, but
the remainder constituted a debt that clamoured for
liquidation, and which it was, of course, impossible to
discharge out of revenue then amounting to barely
£4,500,000 a year. Hence the first of the many
necessities which led to the creation of the Egyptian
Debt. Although the great mass of this consisted of State
loans, a considerable total was also contracted on the
security of the Daïras, or personal estates of the Vice-
regal family. The same features of usury and waste
were, in the main, common to both categories ; but, as
they were distinguished at the time, and are so in part
still, it will be convenient to tell their instructive stories
separately.
The first of Ismail's borrowings, then, had its origin
in the debt thus bequeathed by Saïd, and for it recourse
was had to the same firm which had accommodated the
latter. The date of this operation was 1864, and its
7 per cent. stock with a 4 per cent, sinking fund, and was
issued to the public at 93, it realised to the Cairo Treasury
only £4,864,000. Still, with the aid of an increasing
revenue, the proceeds of this operation might have tided
the Malieh over its most pressing difficulties but for the
cattle plague, which broke out shortly afterwards, and for
more than two years ravaged Egypt from the Delta to
Nubia. This epidemic cost the Treasury nearly £5,000,000
in loss of revenue, in importing cattle to replace those
The Egyptian Problem.
swept away, and in distributing corn and other relief to
the fellaheen who had suffered most from its effects. The
Alexandria and Suez railway, too—the only one then ex-
isting in the country—had been left by Saïd in a state of
complete dilapidation, as regarded both the line and its
rolling stock. To repair and renew these, and in part
also to relieve the drain consequent on the murrain.
Messrs. Fruhling and Goschen were, in 1866, again applied
to for a nominal £3,000,000. Although this was a 7 per
cent. debenture stock, secured on the railway, and redeem-
able in eight years, it was issued at 92, and produced
only £2,640,000 net.
In the meantime, the abolition of forced labour on
the Suez Canal-effected by our own Government through
the diplomacy of Sir Henry Bulwer-and the modification
in some other important respects of Saïd Pasha's contract
with the Company, had raised a crop of differences be-
tween the latter and the Egyptian Government, which, on
reference to the Emperor Napoleon as arbitrator, resulted
in an award of the enormous indemnity of £3,360,000,
in 12 per cent. Treasury bonds. To this scandalous act
of spoliation was added, in 1866, a further extortion of
· 1 It was actually paid off in six annual instalments of 500,0001., begin-
ning in January, 1869.
2 Cairene scandal at the time pointed to this transaction as one of the
chief contributories to the huge fortune of Nubar Pasha, who represented
the Viceroy in the arbitration, and so largely explained the monstrous award.
Similar inferences, indeed, were drawn from his share in the many other
confidential missions entrusted to him by Ismaïl at Constantinople, Paris,
and elsewhere ; but the suspicion may have been no better founded than
that which credited him with similar illicit profit from nearly every loan
contracted during this eventful reign-especially that of 1873. The only
certain fact is that, while at the death of Saïd Pasha he was notoriously a
very poor man, at the deposition of Ismail he was, perhaps, the richest
man in Egypt. Yet, since his fall, the ex-Khedive has had no bitterer
enemy nor more vehement traducer than this Armenian creature of his
favour.
10
The Egyptian Problem.
.
£400,000 for the repurchase of the Wâdy domain, near
the Isthmus, which M. de Lesseps had bought five years
before from Saïd Pasha for £74,000.
In 1868 the strain of these payments, and the
necessity of finding money to carry on the public works
in progress or contemplated, again compelled recourse to
the money-lenders—this time represented by Messrs.
Oppenheim and Nephew, whose connection with
Egyptian finance had begun some years before with
the management of the estates of Il-hami Pasha, then
heir-apparent to the Viceroyalty. These gentlemen
responded readily, if not liberally, to the appeal, and
negotiated a nominal £11,890,000 7 per cent. loan,
redeemable in thirty years, at an issue (not contract)
price of 75, a drop in Egyptian credit which should
have warned the Viceroy of the ruinous incline down
which he was being carried. As the net proceeds of this
operation were only £7,193,000, its annuity cost was
thus 131 per cent. With this amount, however, nearly
the whole of the floating debt was paid off, and for a
considerable time discount in Egypt fell to the unpre-
cedentedly low average of from 6 to 8 per cent.
But the continuing heavy outlay on harbours, rail-
ways, telegraphs, canals, and other public works, which
were being carried out on a scale, not indeed beyond the
wants but, much in excess of the concurrent means of the
country, soon again compelled recourse to the issue of
new Treasury bonds to nearly the full extent of the ex-
penditure so incurred. Owing to the steady expansion
which had taken place in almost every branch of
Egyptian trade, the revenue had largely increased since
the death of Saïd Pasha; but the reorganisation of the
1 The larger of these were being carried out by European contractors at
an average of 80 per cent. extra cost, to cover the risk of irregular payment.
C
The Egyptian Problem.
O
army, the construction of new coast defences, the doubling
of the tribute to the Porte, and other large, though
unacknowledged, payments to Stamboul, had swelled the
expenditure in, at least, equal ratio ; and, after payment
of the annuities on the funded debt, left little or nothing
for public works, the scale and costliness of which grew
with every year. The rapid growth of a new floating
debt was the inevitable result, until, in the spring of
1873, the total of these unfunded liabilities had risen to
nearly £26,000,000, on which the average interest
charge was not less than 14 per cent. This meant
practical bankruptcy, the frank confession of which would,
at the time, have been less disastrous than the desperate
and ruinous remedy by which it was for a while staved
off. Nothing short of a loan far in excess of anything
yet attempted would meet the case, and accordingly an
operation for £32,000,000, nominal, was contracted with
Messrs. Oppenheim on terms that threw every previous
spoiling of the Egyptians,' since or before the Captivity,
into the shade.
The affair, however, proved to be beyond the resources
of the contractors; and after an unsuccessful attempt to
issue the first half of it at 84, the terms of the contract
were greatly modified in their favour, and it was
gradually placed on the market at an average of about
70. This should have produced £22,400,000, less con-
tractors' commission, but in reality the Treasury received
only £11,000,000 in cash, and £9,000,000 (nominal) in
bonds of the floating debt at 93, which the contractors
readily bought up at 65, or less than half in money, and
the remainder in its own depreciated paper-at a total
cost of about £17,000,000 to the contractors. What
became of the large balance has never been explained
This ruinous operation was the last for which the
12
The Egyptian Problem.
administration of Ismail Pasha was responsible; one more
was negotiated with the Messrs. Rothschild in 1879, but
the Nubar-Wilson ministry, rather than the Khedive him-
self, is to be credited with that operation. It will be seen
from what precedes that, out of five loans of a nominal
total of £55,800,000 (including the Saïd debt of 1862),
the Egyptian Treasury had received only about
£36,000,000 in cash or its equivalents, on which it had
already repaid no less than £29,500,000 in interest and
sinking fund up to the end of 1875, when £46,700,000
nominal still remained to be redeemed!
But besides these costly borrowings by the State,
three other private loans for large amounts had also been
contracted on the security of the Daïra properties, and in
their case, again, we meet with similar incidents of usury
in the terms and of improvidence in the use of the money
raised, as in that of the operations just reviewed. The
first was negotiated by the Anglo-Egyptian Bank in 1865,
for a nominal £3,387,000, which, though a 7 per cent.
stock, redeemable in fifteen years, and issued to the public
at 90, produced to the Daïra-Khassa, on which it was
secured, only £2,750,000 net. £1,000,000 of this sum was
applied in buying out Prince Halim Pasha, whose estates
so purchased formed part of the security; and the re-
mainder in the construction of sugar mills, irrigation, and
other works on the properties concerned. The second
loan—known as the “Mustapha Pasha Loan,' from its
similar object of acquiring the domains and so weakening
the influence of that prince, who was then heir to the
Viceregal throne-was issued in 1867 through the Imperial
Ottoman Bank, at 90, secured on the property pur-
chased. This, for £2,080,000 nominal, was a 9 per cent.
stock, and realised £1,700,000 net. The third opera-
tion, known as the “Khedive Loan,' took place in 1870,
The Egyptian Problem.
13
for £7,143,000, nominal, through Messrs. Bischoffsheim,
who issued a 7 per cent. stock, redeemable in twenty years,
at 75; but of its proceeds at this price (£5,350,000) the
Daïra only received £5,000,000, the contractors' charges
again absorbing the balance. The object of this loan
was to develop the cultivation of sugar-cane and erect
factories on the estates of the Daïra-Sanieh, by which it
was secured.
Thus, in eleven years the loan-mongers bad saddled
Egypt (Treasury and Daïras) with a total debt of
£68,497,000, against which only £43,787,000 had been
received. This scandalous fact will, perhaps, be best
impressed on the eye and memory of the reader by a
tabular recapitulation of the details, grouping the two
categories of loans together. Thus :

Date
Contractors
Nominal
Net
1862
1864
1865
1866
1867
1868
1870
1873
Fruhling-Goschen
Anglo-Egyptian .
Fruhling-Gioschen .
Imperial Ottoman Bank
Oppenheims
Bischoffsheim
Oppenheims .
3,293,000
5,704,000
3,387,000
3,000,000
2,080,000
11,890,000
7,143,000
32,000,000
2,640,000
4,864,000
2,750,000
2,640,000
1,700,000
7,193,000
5,000,000
17,000,000
£68,497,000 £43,787,000
The query will be pertinent—what was done with even
this £44,000,000 ? and will be answered later on.1
The cash proceeds of the disastrous 1873 loan barely
relieved the embarrassment it was meant to extinguish,
and a mass of floating debt, therefore, still remained, which
the cost of renewals—many as high as 30 per cent.--
continued outlay on public works, and the cost of the
1 See note on p. 19.
14
The Egyptian Problem.
Abyssinian war (about £1,500,000) rapidly again swelled
to a figure against which the Treasury became powerless
to struggle. Towards the end of 1875 its difficulties had
culminated to a point that would have compelled a sus-
pension of payment, but for the sale of the Khedive's
shares in the Suez Canal to the British Government, the
£3,966,583 received for which temporarily staved off the
crisis. Then, at the Khedive's request, came the mission
of Mr. Cave, to investigate and advise on the whole state
of the Egyptian finances. Mr. Cave's report showed that
both the State Treasury and the Daïras were essentially
solvent, and needed only better administration to meet all
their liabilities. The refusal of Lord Derby, however, to
lend the Khedive a commissioner to carry out the sug-
gested reforms further damaged Egyptian credit, and his
Highness, unable to renew his maturing Treasury bonds,
except on absolutely ruinous terms, wisely decided to
suspend payment until some equitable readjustment of the
burden could be arranged. The total amount of the
floating debt, chiefly in the form of Treasury bonds, had
then roundly reached £22,500,000 (reduced by the pro-
ceeds of the Canal shares to £18,250,000), the greater part
of which was held by a French group represented by the
Anglo-Egyptian Bank, the Crédit Foncier, and the Comptoir
d'Escompte of Paris. In concert with the agents of this
ring,' a scheme was framed by Ismail Sadyk Pasha, the
able but corrupt Minister of Finance, consolidating the
whole of the funded and floating debts of the State and
the Daïras into a unified 7 per cent. stock of £91,000,000,
redeemable in sixty-five years—with a bonus of 25 per cent.
to the holders of the unsecured Treasury bonds. Under pres-
sure of the strongest official French influence in its support,
this iniquitous scheme was accepted by the Khedive, but
speedily collapsed before the refusal of the London Stock
TUS
The Egyptian Problem.
15
Exchange to quote the new scrip. Then, in 1876,
followed the mission of Messrs. Goschen and Joubert,
as delegates of the English and French funded bond-
holders, the former being officiously' supported by the
British Foreign Office, and his colleague quite as
strongly by the Quai d'Orsay. The story of their action
at Cairo need not be told at any length; enough to say
that they succeeded, in virtue of their official support, in
imposing on the Khedive a settlement which was only a
shade less onerous to Egypt than that which the veto of
our Stock Exchange had defeated. Equally with the
latter scheme, they ranked the holders of Treasury paper
with the funded creditors, but reduced their proposed
bonus of 25 to 10 per cent. ; and by eliminating three
of the smaller loans (for payment out of the Moukabala
and the Daïra revenues) from the ‘ring' total, reduced
this to £76,000,000, which they divided into a preference
5 per cent. stock of £17,000,000, and a general unified
7 per cent. debt of £59,000,000. In vain the Khedive
and others, who knew the resources of the country, pro-
tested that not more than 5 per cent. interest could be
paid all round ; at the point of the diplomatic bayonet
his Highness was, as before, forced to accept the higher
rate—with what result the early future soon showed.
Nor was this all: to Messrs. Goschen and Joubert belongs
the invention of the Dual Control, to whose growth and
attempted usurpations later on, the Egyptian catastrophe
has been so largely due.
Less than a twelvemonth sufficed to justify the pre-
dictions that the burden thus imposed would prove
beyond the power of the country to bear. The Anglo-
French Controllers found the State revenue insufficient to
meet the coupons, and the Khedive only saved the Daïras
from bankruptcy by surrendering his own private estates,
16
The Egyptian Problem.
17
LT
worth £450,000 a year, to pay the interest on their debts.
Then followed the Commission of Enquiry, as mem-
bers of which Mr. (now Sir) Rivers Wilson and M. de
Blignières investigated the whole situation, and made an
elaborate report, the conclusions of which the Khedive
· accepted without reserve, although they involved the
cession to the State of the whole of the remaining
domains owned by the Viceregal family, with an aggre-
gate rent-roll of £430,000 a year. The Nubar-Wilson-
Blignière ministry, formed in August 1878, soon proved
to be a mere "triumvirate of dictators,' who aimed at
country in the sole interest of the bondholders. By
them it was that the ninth and last loan of this reign
was contracted with Messrs. Rothschild for £8,500,000,
nominal, on the security of the surrendered family estates.
The events of the past two or three years had so weakened
Egyptian credit that, although sponsored by the great firm
of New Court, this operation could be issued only at 73,
and so, after deducting the contractors' not unreasonable
commission of 21 per cent., realised to the Treasury only
£5,992,000. Considerable delay, too, took place in the
payment of this amount, owing to certain judgments which
had been obtained by creditors of the assigned domains,
which Messrs. Rothschild insisted on being wholly cleared
before parting with the money."
The policy and action of the Triumvirate soon pro-
voked wide-spread discontent throughout the country.
Their responsibility,' it was cynically said at the time,
consisted in their being 'irresponsible' to the Khedive,
and answerable only to themselves. Not only was it
plain that the coupons were their first and main care,
but many hundreds of native employés were weeded
out of the public service, to make way for highly paid
The Egyptian Problem.
17
and mostly incompetent foreigners imbued with the same
mind. This culminated in February 1879, when a mixed
popular and military émeute at Cairo forced the doubt-
less not unwilling Khedive to dismiss Nubar. A month.
was spent in vigorous efforts by Messrs. Wilson and
Blignière with their Governments to compel his restora-
tion ; but as Mr. Vivian, our Consul-General, advised
the other way, Lord Salisbury and M. Waddington con-
sented to his being replaced by Tewfik Pasha (the present
Khedive), on condition that Ismaïl himself should not
attend the cabinet meetings, and that Messrs. Wilson and
Blignière should have an absolute veto on all proposed
measures ! To these remarkable conditions Ismaïl again
submitted, and Tewfik became President of the Council
on March 22; but the hollow compromise proved more
than ever unworkable, and in less than a month the
Khedive swept it away, and, without reference to London
or Paris, appointed a native ministry under Sherif
Pasha, responsible only to the Chamber of Delegates and
himself. By this a scheme was promptly prepared for
dealing with the financial deadlock, but as it proposed
a reduction of the debt interest, it was, of course, resisted
by the bondholders; and, again moved by their all-
powerful influence, Lord Salisbury and M. Waddington
resented the dismissal of their agents by inducing the
Sultan, whose prerogative had been so long ignored, to
issue in June 1879, a firman deposing Ismail, and
appointing Tewfik in his stead.
To this second international blunder the whole of the
calamities which have since befallen Egypt may be directly
traced, and for it the Government of Lord Beaconsfield
was more than half to blame. For, whatever may have
been the defects of Ismail's administration, he was abso-
lutely the only man in the country with the strong head
18
The Egyptian Problem
and the firm hand indispensable to its government. Dur-
ing nearly seventeen years he had ruled it as a colonel
rules his regiment, making his personal influence felt
through every branch of the public service, and giving at
least order and strength to the whole. His thinly-veiled
ambition was to realise the grand idea of Mehemet Ali-
the re-erection of Egypt into an independent Arab king-
dom--not, indeed, by force of arms, but of European
civilization grafted on such elements of national life as
had survived the revolutions and the oppression of more
than a thousand years. In attempting to achieve this, he
made the fatal mistake of endeavouring to run while he
should have walked. As gardeners · force' plants, so he
tried to precipitate social and economic results which time
alone could healthily develop. Hence the lavish and often
wasteful expenditure on public works, schools, judicial
reforms, the army, a mercantile steam marine, and many
other enterprises, any one of which would have taxed the
full capacity of Abbas or Saïd, but the whole of which
he endeavoured to promote at a rate as much in advance
of what such a population was capable of as of what the
country could afford. Hence, too, the outlay of other
large sums (moderately aggregated at £5,000,000, and
chiefly paid through Nubar) in purchasing at Stamboul
the various firmans which changed the order of succes-
sion, enlarged the Viceroy's powers, and raised his rank
to the quasi-regal status of Khedive; as also in winning
for him sundry European protections' which all proved
broken reeds at the last. But, full debit being made
for all these errors of judgment and of action, there still
remains to his credit a balance of administrative ability
and of achieved results such as can be claimed for no
other Mussulman ruler of the present century. He found
Egypt, it is true, with a debt (funded and floating) of less
The Egyptian Problem.
19
than £15,000,000 and left it with £77,000,000, but he
also found it with a revenue of less than £4,500,000,
and left it with £9,000,000; found it with a tilled area
of only 4,000,000 acres, and left it with 5,500,000; with
a trade, in all, of £5,500,000, and left it with more than
£19,000,000.1
1 A fuller and more exact statement of this contrast between 1862 and
1879 will still better measure the progress made by Egypt during the reign
of Ismaïl, and will at the same time supply an answer to the query antici-
pated on p.13, as to what became of the net proceeds of the European loans.
The chief details may be most conveniently stated in tabular form:-
1862
Tilled acres . . . . 4,052,000
Imports
· · · · £1,991,000
Exports . . . . 4,454,000
Revenue :
: 4,937,000
Debt (funded and floating) | 15.000.000
nearly · · · I
Public schools
185
Canals (miles) . .
44,000
Railways ,
245
Telegraphs
350
Population
• 4,833,000
1879
5,425,000
£5,410,000
13,810,000
8,562,000
77,000,000
4,817
52,400
1,216
5,962
5,518,000
Of the public works thus constructed, the Suez Canal (including the Sweet
Water Canal and the repurchase of the Wâdy domain) cost the Treasury
in money outlay and interest £17,427,825, or, deducting the shares sold to
the British Government, roundly £13,430,000; 8,400 miles of canals at an
average of £1,500 a mile, £12,600,000; 426 bridges at an average of £4,000
each, plus £140,000, the cost of the splendid iron bridge across the Nile
from Boulak to Ghizeh, £1,844,000; 971 miles of equipped railway, at
£13,000 a mile, £12,523,000; 5,600 miles of telegraphs, £853,000; lighthouses
on the Red Sea and the Mediterranean, £188,000; harbour and dock works
at Alexandria and Suez, £3,942,000; Alexandria waterworks, £300,000;
64 sugar factories, £6,100,000; or a total of £51,780,000, against
£49,779,000, the net produce of all the loans contracted during 1862-79.
It is thus demonstrated that, however wasteful much of the outlay may
h..ve been, £2,000,000 more than the whole net amount borrowed was so
spent out of revenue, which also bore the burden of the Abyssinian war
and of Nubar's underground diplomacy at Stamboul and elsewhere. With
good reason, therefore, might Sir Bartle Frere testify, at the Edinburgh
Philosophical Institution in 1874, that "There is one Arab Power to which
the eyes of all friends of Africa naturally turn with hopefulness. Egypt
has ever been the great centre of African civilization in the hands of
B
2
20
The Egyptian Problem.
Once
ne
Thus, whatever may have been his faults, it is indis-
putable that the progress of Egypt during his reign was
immense, while the authority of the government was
upheld, and order maintained everywhere, from the Medi-
terranean to the Bahr-el-Ghazel, and from the Red Sea
to the Oases and Darfour.
Tewfik succeeded in June 1879, and the jubilation of
the bondholders-not of the Egyptians—was for a time
great. The influence of their representatives, Messrs.
Baring and de Blignière, the joint controllers, became at
once supreme; and Riaz Pasha, their warm ally, being
named president of the Council, steps were promptly
taken to secure the charges on the debt as they had
never been secured before. All the guarantees given by
the late Khedive had at best been of municipal force;
they were now to have one that should be international.
To this end a commission of British, French, German,
Austrian, and Italian delegates was appointed, to embody
in a Law of Liquidation, the best possible provision for
the coupons and sinking-funds which the revenue would
afford, and to give to this all the force of an engagement
that could be neither evaded nor broken without direct
responsibility to the Powers. By this, which, after com-
munication to the other European Governments, was
issued in the form of a Khedivial decree in July 1880,
the Preference debt was fixed at a total of £22,587,000
and the Unified at £57,776,000; the interest in the
latter being at the same time reduced to 4 per cent., as
had been refused when proposed by the late Khedive-
and the Daïra and Domain (Rothschild) debts treated as
the present dynasty, which may be fairly said to represent much that is
excellent in European civilization. Of the enormous increase of the aggre-
gate wealth of the country there can be no doubt. Steam and railways have
done at least as much for Egypt as for almost any European country.'
And for this nearly the whole credit may be fairly claimed by Ismaïl.
The Egyptian Problem.
21
mortgages on the surrendered Vice-regal estates, the
assignment of some special extra security to the latter,
and the reduction of their respective rates of interest to
4 and 5 per cent. Of an estimated revenue of £8,400,000,
£3,565,000—to be subsequently increased-was assigned
for payment of the debt annuities ; leaving £4,825,000
for the administration, the tribute, the repayment of the
Moukabala, a subvention to the Daïra revenues, and the
interest on our Suez Canal shares. The fact that this
settlement placed the country in bonds to Europe as it
had never been placed before, was keenly felt by all
classes of the Egyptian people, whose jealous discontent
was further roused by sight of the Europeans who
swarmed in nearly every branch of the public service,
many of them virtual sinecurists, and all keeping bread
out of native mouths. These and other causes of
popular heart-burning under a régime in which the new
Khedive was already a nonentity, and his ministers partly
puppets, partly accomplices of the dominant foreign ‘ring,'
at length fermented to a head in September 1881, when
a second mutiny of the Cairo garrison, led by the soon-to-
be-famous Arabi, gave voice to the common feeling of
the country. Besides increased rank and pay for himself
and the officers acting with him, Arabi demanded the
replacement of Riaz by Sherif, and the summoning of
the Chamber of Delegates, with effective powers over the
Budget. The submission of the Khedive to all three of
these demands made the leaders of the revolt masters of
the situation, and for some months their will was virtu-
ally the only government in Egypt. Sherif resigned early
in 1882, and was followed in turn by Mahmoud Samy
ny
? In 1881, there were 1,324 Europeans in various posts, drawing in
salaries an aggregate of £373,704 a year, or 4 per cent. of the gross revenue
of the country.
22
The Egyptian Problem.
and Ragheb, as titular heads of cabinets in which Arabi,
as Minister of War, was supreme. In June the so-called
national' revolt, of which he claimed to be the organ
and leader, culminated in the massacre of Europeans at
Alexandria-with the connivance, there is little doubt, if
not at the direct instigation, of Arabi and his friends.
In the meantime, in view of the anarchy of which this
was but the crowning incident, England and France had
already agreed as to the necessity of intervention, and at
the suggestion of the latter Power, a Conference had met
at Constantinople to settle the mandat under which this
should take place. But the dilatory tactics of the Porte
neutralised this effort, until the hostile preparations of
Arabi in the Alexandria forts against the English and
French squadrons in the harbour precipitated independent
action. In this, at the last moment, the French declined
to join, and the disastrous bombardment of July 11 was
accordingly delivered by the British ships alone. How
this was followed up by the military operations under
Lord Wolseley, the overthrow of Arabi, and our occupa-
tion of Cairo, need not be told. Still less need allusion,
in any detail, be made to the rise and spread of the
Mahdi's revolt in the Soudan, with its disasters to the
armies of Hicks and Baker, the massacres at Sinkat,
Shendy, and Berber, and the wanton slaughters by
General Graham at El-Teb and Tamasi. These terrible
episodes are still fresh in the public memory, and that
much of their blood-guiltiness lies at our door cannot, in
truth and conscience, be denied. Since the middle of
September 1882, our supremacy in Egypt has been
complete, and for most of all that has befallen the country
since then, we are fairly answerable to the world.
Party casuistry, of course, denies this ; but when the
history of the past eight years comes to be written, the
The Egyptian Problem.
23
blunders of our Foreign Office in connection with Egypt,
from the Goschen-Joubert mission to the Conference
now sitting, will form a record of which no Englishman
can be proud.
To complete this rapid statement of the problem, it
remains to remind the reader of our own national in-
terests in Egypt, and to briefly summarise the results of
our two years' occupation.
Besides our common concern with all Europe, in the
settlement of 1840-1, in the higher status accorded to
Ismail, and in the unprecedented guarantees imposed upon
him and his successor with reference to the public debt,
we have special interests in the country with which those
of no other Power can be compared. Above half the
entire trade of the Delta and Upper Egypt is in our
hands. We own nearly half the Suez Canal shares, and
contribute above 85 per cent. of its traffic; while, more
than all, the Canal itself is of vital importance to our hold
upon India. This is, I know, denied by the advocates of
a “scuttle-out' policy, who pretend that even with the
Russian outposts almost in sight of Herat, the gain of
seventeen days by this route over that round the Cape is
of no military value. Happily, this solecism of judgment
is shared by only a few extreme Radicals; the general
sense of the nation is in accord with the experts in regard-
ing the Canal as an essential link in the chain that binds
our great eastern dominion to Britain. Against such
weighty and special interests as these, France can set off
little beyond her admittedly honourable share in the great
ditch, her ownership of half its capital, and the sentimental
rights' which have survived the expedition of 1798–
1801; while, outside mere diplomacy, the rest of Europe
has absolutely no claim to active influence in the country.
Unhappily, the results of our intervention thus far have,
HUIC
24
The Egyptian u
LI
Problem.
in his own pregnant words, given M. Ferry • a unique
opportunity of re-entering into Egyptian affairs,' and
have supplied the other Powers with a valid excuse for
supporting the revived French pretensions. What, briefly
told, have these results been?
Ten days after our occupation of Cairo, Tewfik re- ;
turned to Abdeen under the protection of British bayonets,
and from that day to the present he has been the veriest
roi faineant who ever made pretence of independence.
The miserable rôle he had played in the tragi-comedy on
which the curtain fell at Tel-el-Kebir had turned all
classes against him, from the village fellaheen to the
sheikhs and students of the Azar; and not merely his
reign, but his life would not have been worth a week's
purchase but for the red.coats who mounted guard before
his palace, and cowed Cairo from the old citadel of Sala-
deen. “Without head, heart, or courage -to use his father's
terse description of him_even under ordinary circum-
stances, he was of course wholly incapable of dealing
with the chaos that followed the collapse of Arabi. The
Ministry, under Sherif, seemed to be equally paralysed, and
in our Consul-General and the commander of the British
troops. It was as if a conquest, and not the suppression
of a revolt, had taken place. Tewfik himself reckoned for
nothing, and Sherif and his colleagues were mere depart-
mental clerks in the feeble hands of Sir Edward Malet.
Early in November, therefore, Lord Dufferin was
despatched from Constantinople to reconstruct the
administration of affairs on a basis which should afford
satisfactory guarantees for the maintenance of peace,
order, and prosperity in Egypt, for the stability of the
Khedive's authority, for the judicious development of
self-government, and for the fulfilment of obligations
111
The Egyptian Problem.
25
towards foreign Powers'-still and always the coupon !
It need not now be said that the six months' mission of
the most brilliant agent of our Foreign Office bore fruit
in little beyond an eloquent report, exposing the weakness
and corruption of every branch of the Egyptian adminis-
tration, and formulating a scheme of reforms which on
paper was artistically perfect, but which everyone who
knew Egypt knew to be as impracticable there, under a
native government, as in Turkey itself. Under an
• Organic Law,' framed on the lines of it, a Chamber of
Notables has been elected,' which, in point of intelligence
and independence, is no whit better than that which was
summoned by Ismail in 1866; an army of 6,000 men has
been organized by British officers, but as yet it may not
be trusted against the Mahdi; while, although a 'code'
has been framed for the new native courts, and Dutch,
Swiss, and Belgian judges, who know not a word of the
vernacular, have been imported at high salaries to check,
in some degree, the corruption of the muftis and cadis
who, for most of a thousand years, have sold fetvâs to the
highest bidder, the reform has not yet gone much beyond
the paper stage, and Ahmed the Fellah has still to be
content with such justice as the old methods afford. We
have similarly stiffened' almost every Ministry at Cairo
with English Under-Secretaries, who, though nominally
subordinate to native chiefs, have treated them as dummies,
and have irresponsibly meddled and muddled at the orders
of Her Majesty's Consul-General alone. The only symbol
of any other authority that might have interfered with
our own, was got rid of by the abolition of the Dual
Control in January, 1883, when a Khedivial decree
abolished that institution, and immediately after re-ap-
pointed the English member of it. Financial Adviser'
to the government. Yet, while shattering '-to use
26
The Egyptian Problem.
Mr, Gladstone's own phrase-the whole framework of
native administration and reconstructing nothing in its
stead, we disclaimed in everything the responsibility which
is the unavoidable correlative of power. Only once did
the farce of British advice' rise into more sober
comedy when, in January last, Sherif and his colleagues
jibbed against Lord Granville's order to abandon the
whole Soudan. Then, for the first time, his lordship
showed the steel under his ill-fitting glove, by informing
the Khedive, through Sir E. Baring, that “It should be
inade clear to the Egyptian Ministers and Governors of
provinces that the responsibility which for the time rests
on England obliges Her Majesty's Government to insist on
the adoption of the policy which they recommend, and
that it will be necessary that those Ministers and Gover-
nors who do not follow this course should cease to hold
their offices. This was promptly followed by the despatch
of General Gordon--at first without reference to the
Khedive--to carry out the abandonment against which
the Egyptian Ministers had protested. The step thus
peremptorily ordered has, indeed, since been in part
retraced, and the Eastern Soudan at least is to be
retained; but the incident none the less illustrates the
consistency of our policy' in this Egyptian business
throughout.
The resignation of Sherif Pasha in the face of this
dictation made way for Nubar, who took office as an ultra-
English partisan, and—as all who knew him foresaw-
soon falsified every hope with which those who did not
know him hailed his return. For months past it has been
notorious in Cairo that he has been intriguing against us
with M. Barrère, the clever French Consul-General, and
to their joint inspiration the diplomatic success of M.
Ferry in the recent negotiations has been mainly due. ;
The Egyptian Problem.
27
Nubar and his French ally found their opportunity
in the financial deadlock for which our policy has been
quite as directly answerable, as was Ismaïl for any one
of those straits which so often forced him into the toils
of the usurers. Relatively, we have, in this respect,
surpassed him; for, while he took seventeen years to
build up a net State debt of £50,000,000, all spent on
great public works, in less than two years we have
produced in the Alexandria indemnities, a reduced
revenue, increased expenditure, and a consequent floating
debt, which have all flowed more or less directly from
our action—a further deficit of more than £8,000,000,
for which there is not even a street sewer to show. As
we had disclaimed responsibility for every other result of
the two years' administration, so also might we have
repudiated this, and have left all concerned to compound
on the best terms possible with a bankrupt Treasury,
upon which, so long as we were in occupation, they
could have brought nothing more coercive than diplo-
matic pressure to bear. There was, at any rate, no rea-
son why the Law of Liquidation should not have been
modified by use of the same modest means that originally
settled it-namely, by a mere consular commission and
the exchange of a dozen or more despatches between
the Governments concerned. These sufficed to make
the Law in 1880, and should have equally availed
to modify, or, still better, to repeal it altogether, in
1884. Nor, beyond this financial object, was there
-if nothing more was honestly intended a shadow of
need for reference to Europe at all. On the fundamental
question of an occupation, we had, so far as Europe was
concerned, a perfectly free hand : France had voluntarily
put herself out of court, and every other Power had ac-
quiesced in what none of them could help. Yet, by an
28
The Egyptian Problem.
-
evil inspiration of Lord Granville, this vantage ground has
been lost; a Conference has been summoned, and the
floodgates of international intrigue and chicane have been
opened on the whole Egyptian Question. This may be
statesmanship,' but, from a patriotic and common-sense
point of view, it does not commend itself to ordinary minds.
Such, then, somewhat discursively, but still fairly
stated, are the main factors in this complicated problem.
As I have endeavoured to avoid both personal and party
bias in the short historical sketch that precedes, so I need
not disclaim either in the solution of the question which-
sharing, as I believe, the view of nearly all who under-
stand it best-I will now venture to suggest.
Any adequate solution must cover the Porte, Europe,
ourselves, the bondholders, and the Egyptian people; and
the puzzle is, how proportionate justice shall be dealt out
to claims so various and conflicting. Both the measure
and the methods of such justice must, of course, depend
on the political settlement arrived at; but be this what
it may, the financial difficulty must in any case be first
grappled with, and I shall therefore suggest an alterna-
tive solution of this, to fit either event-whether the out-
come of the crisis be a reconstituted native government,
or a British protectorate.
The circular issued some weeks ago by our Foreign
Office as the basis of a proposal for a Conference reckons
the accumulated deficits and liabilities of the Egyptian
Government for the past three years at about £8,000,000,
and the estimates for the present year show a further
deficit of above £500,000. Thus a loan of at least
£8,000,000 is necessitated to meet debt of pressing
urgency, and either an increase of revenue or a reduction
of expenditure is equally essential to effect a future
budgetary equilibrium. The first of these difficulties is
The Egyptian Problem.
met by the offer of Her Majesty's Government to lend
£8,000,000 at the low rate of 4 per cent., the amount
ranking as a first charge on the Egyptian revenue. Even
this, however, would add £320,000—or, with a 1 per cent.
sinking fund, £400,000_to the present debt charges of
the Cairo Exchequer, and raise its annual deficit to a
round total of £900,000 a year. How, not only is this
to be met, but over and above it, how is relief to be
given to the already over-taxed fellaheen ? On the hypo-
thesis even of a native government, few easier problems
have seldom presented themselves to a financial reformer,
as there is almost an embarrassment of choice as to the
methods by which the deficit may be covered. Thus, in
the direction of increased revenue, the new tax upon
foreigners, which does not appear in this year's estimates,
will produce at least £100,000; while an equalisation of
the land-tax-between an average of seven shillings an
acre on the privileged oushurieh estates, and twenty-two
shillings on the peasant-held miri lands—would yield
£800,000 at once ; but if even half of this be foregone,
either to lower the re-adjusted tax, or to deal with
the fellaheen debts, this most equitable reform could still
give £400,000 a year. A revision of the customs tariff
and the proposed tobacco régie would add largely to the
half million thus gained; but as no exact estimate of their
yield has been made, they need not be considered. Then,
on the side of reduced expenditure, the very first reform
that challenges treatment is the monstrous tribute of
£678,000 a year to the Porte. By the settlement of
1840, this was fixed at £376,000; but in consideration
of the higher title and privileges conceded to him in 1866,
the ex-Khedive raised the payment to its present figure.
A return to the original amount so long as tribute at
all is to be paid to a suzerain who has never given an
30
The Egyptian Problem.
iota of equivalent for such a tax-would obviously be the
fairest measure of such a reduction ; but as the whole of
the present amount has been hypothecated to the Turkish
Tribute loans, it might, perhaps, be hard on the holders
of these to dock it of more than £150,000 a year. But as
they bought their bonds with all the risks and equities'
attaching to their security, they might very fairly be asked
to make such a contribution to the relief of a country that
pays all their annuities and receives nothing in return.
To this might, with similar equity, be added £280,000
produced by a reduction of half per cent. on the Unified
interest; nearly £40,000 by a 1 per cent. reduction on
the interest paid on our Suez Canal shares, and £400,000
by temporarily suspending the sinking fund on the debt,
representing in all a reduced expenditure of £870,000;
or, of new revenue and economies together, a total of
more than £1,300,000. This would very effectually
balance future budgets, would provide for the con-
tingency of bad Niles,' and still leave a margin avail-
able for further relief of the fellaheen. Nor would any
of the changes involved entail a single injustice on any of
the interests affected. Honest and vigorous administration
would then alone be needed to place the finances of
Egypt, even under native management, on a footing of pros-
perity inferior to that of no second-class Power in Europe.
But while suggesting these ready means of enabling
the Cairo Treasury, in native hands, to meet all just
charges upon it, I must interpolate a word of pro-
test against the monstrous injustice and oppression in-
volved in the foreign coercion in the interest of its
bondholders, from which Egypt has increasingly suf-
fered from 1876 to the present day, and of which
the meeting of the present Conference is another, and
as yet the most solemn, diplomatic illustration. There
The Egyptian Problem.
31
is absolutely no precedent in the whole history of
international finance for the course pursued by England
and France in this behalf. On the contrary, the pro-
claimed rule of our own Government in all other
cases has been to leave speculative lenders to foreign
States to bear the full risk of such operations. Thus, in
the very year of Messrs. Goschen and Joubert's mission
to Cairo, with all the support that Downing Street and the
Palais d'Orsay could give to them, there were no fewer
than seventeen defaulting States of which twelve still re-
main-on the black list of the Foreign Bondholders'
Corporation, for a round total of £400,000,000. These in-
cluded most of the South American Republics, Mexico,
three of the United States, Greece, and Turkey; and in
not one case of the whole did even a Consular despatch
carry from our Foreign Office a word of protest on the
lenders' behalf. But the Shylocks who had victimised
Egypt were creditors of another stamp. Both in London
and Paris they were powerful in Parliament and the press,
and all the resources of diplomacy, backed at last by our
own naval and military force, have accordingly been em-
ployed to exact the last ounce of their pound of flesh
from the helpless fellaheen. The tradition of this great
influence will probably still avail to maintain the ini-
quitous anomaly involved in the Law of Liquidation,
however it may be now amended. And this, too, though
it is notorious that most of the present holders of these
stocks are mere gamblers on the money changes of
Europe. But · Egyptians' are sacrosanct, and must pay
the last centime of an exorbitant interest and sinking
fund, whether the country can bear it or not; while
Peruvians' Mexicans,' - Virginians,' and Turks' may
be cut down or be even repudiated at will.
On the other hypothesis, however, of a British annexa-
UCA
1
32
The Eyyptian Problem.
tion or protectorate, the solution of the financial difficulty
is simpler and easier still. It is, indeed, plainly suggested
by the action of the French in Tunis. There, too, a
multiple control in the form of an International Commis-
sion administered the financial government of the
country, and reduced the Bey to a cipher. Almost the
first act of the French, on annexing the province, was
to abolish this foreign condoininiuin and take its place by
guaranteeing the whole Tunisian debt at a reduced rate
of interest. In the event of a similar establishment
of our supremacy in Egypt, our true policy would
evidently be to follow this precedent. By conferring on
them this enormous boon—which, it will be seen, would
cost ourselves nothing—we should at once silence the
bondholders, and disarm three-fourths of such political
opposition as the French might try to foment against the
establishment of our authority at Cairo. The total
bonded debt, Preference and Unified, now amounts to
about £80,000,000, and roundly costs £3,530,000 a year,
while a consolidated guaranteed 3 per cent. stock for the
same total would cost only £2,400,000. Even adding to
this £320,000 for the £8,000,000 proposed to be lent by
our Government, the resultant economy would still be
£810,000 a year, which might be raised to considerably
above £1,000,000 by similar treatment of the Tribute
Loans, whose heavy security now forms a first charge on
the revenue, and must itself be ultimately extinguished
in any drastic reform of Egyptian finance. If to this
were added only another £500,000 from the re-adjust-
ment of the land-tax and some of the other sources indi-
cated as available to even a native administration, a clear
total of more than £1,500,000 would be practically
added to the revenue of Egypt-a sum, it need hardly
be said, more than sufficient in British hands to maintain
in
The Egyptian Problem.
33
a financial equilibrium, without taxing our guarantee for a
shilling
The present financial difficulty being thus, in either
event, easily disposed of, we come face to face with
the much graver question of what is to be the political
solution of the problem. It may be taken for granted
that, be the outcome of the Conference what it
may, its separation must clearly mark a new departure in
our own policy. The vacillation and the evasions of
responsibility which have so gravely discredited us during
the past couple of years before Europe and with the
Egyptian people must cease, and, whether we act under
the mandate of Europe, or in honest recognition and
discharge of the duties our position has entailed from
the first, from and after next week we must not only oc-
cupy but rule. There must be an end to our accepting
checkmate at every point from either the blank incapacity
of Tewfik or the dishonest craft of Nubar; and though the
former may for the present be retained to sign decrees,
the latter--who is as much a foreigner as Sir E. Baring
himself—must either be made to submit absolutely to our
Agent, or be at once replaced by some native who will.
But, even that done, the situation will still be only a pro-
visional one; the problem will be as far as ever from being
solved, and yet in one, two, or--if the Anglo-French
agreement be upheld—at farthest three and a half years,
the difficulty must be faced and a definite solution found.
From the first, my own judgment has never varied
as to what that solution should be, and it appears to me
still to be suggested with irresistible logic by what pre-
cedes. From Mehemet Ali to Ismail, we have played a
foremost part in Egyptian affairs. We have helped in
the commercial development of the country more than
all the rest of Europe together, and doubtful service!
34
The Egyptian Problem.
WS
-We have also lent it more money. But far beyond
this stake in its trade and its debts, our right--because
our necessity—to a dominant influence over its govern-
ment flows from its geographical position. Free passage
through the Isthmus is essential not merely to our vast
Eastern commerce, but to our military power in India,
and that can only be absolutely ensured by our supre-
macy at Cairo. From the morrow of Sir Beauchamp
Seymour's bombardment, therefore, only one outcome
was consistently possible—that our authority, to the
subordination of every other, should henceforth be esta-
blished in the country; in other words, a British pro-
tectorate quite as direct as that which the French have
imposed upon Tunis, without a hundredth part of the
justification which we might plead for a similar hold
upon Egypt. They invented the Khroumirs, and on
the strength of that fiction have annexed the Regency,
which, although paying no tribute, was, in law, as much
an “integral' part of Turkey as the Nile Valley itself.
Yet, in spite of all the treaties, we and the rest of Europe
have accepted the accomplished fact, and have legitimised
what it was no one's special interest to prevent. To such
an act of piracy the establishment of our own supremacy
in Egypt would offer no parallel. No doubt civilization
and the Tunisians will gain by their filibustering, but, as
a matter of relative justification, there can be no com
parison between the right of the French to dictate at the
Bardo and our own to control at Abdeen.
In his recent statement in the French Chamber, M.
Jules Ferry frankly avowed that the condominium is
dead and incapable of resuscitation; and, while aban-
doning none of the claims of France to a voice in any
settlement of Egyptian affairs, he could not but acknow-
ledge the major strength of our own. With Tunis,
The Egyptian Problem.
35
Tonkin, and Madagascar, indeed, fresh in the public
memory, and with Morocco looming into view, he knew
well that it did not lie in any French mouth to dispute
our rights on the Nile, or to protest against the only policy
by which they can be upheld. Whatever Chauvinist
jealousy, therefore, may still find expression in certain
Paris newspapers, it may be quite safely assumed that
the strength of our position in Egypt is recognised by
the French Government, and is acknowledged also, how-
ever grudgingly, by the French nation at large. Still
less has it been challenged by any of the other Powers.
Only at the Porte, as might be expected, has a word of
disapproval of our action been heard ; and if the Queen
were proclaimed at Cairo to-morrow, not a soldier nor a
ship in all Europe would be moved in protest.
A further strong justification for such a policy is sup-
plied by the poverty of administrative ability available for
a native government. Tewfik, it need not be repeated, is a
cipher; and behind him there is not even one man in the
country who is at all fitter to play the part of an Egyp-
tian A'ali or Fuad than is the poor weakling himself to
travesty the rôle of Mehemet Ali or Ismaïl. The few
possible candidates for upper ministerial office may be
counted on less than the fingers of one hand, and during
the past four years we have rung the changes on them
all, with the result of finding not one who, with a lay
figure at Abdeen, could pilot the country through its
abounding troubles. Sherif, Riaz, Nubar have all been
tried and found variously wanting. The first, though a
Turk, is a débonnair French gentleman as incapable of
dishonour in any form as of ruling Egypt without a
guiding hand and head above him. Riaz, of Jewish
origin, is an abler man and equally honest, but
after his promotion to first-class office he developed
36
The Egyptian Problem.
1 YY
qualities which equally unfitted him to play the vice-
Khedive to the satisfaction either of the European
Agents or of the Egyptian people. Of Nubar it is
not safely easy to write the truth. An Armenian
of Smyrna, he possesses nearly all the typical vices
of that crafty, greedy, and hyper-selfish race; and has
given constant proof of them since he entered the ser-
vice of Saïd as a penniless kiatib until he climbed to
Pasha's rank and a colossal fortune under Ismail. His
intimate relations with the loan-mongers, and through
them with the Western press, have won for him a fac-
titious reputation for statesmanship,' “patriotism and
• sympathy with European liberalism,' for which his real
character affords absolutely no justification. But even if
half of it were true, the baseness with which, since 1879,
he has repaid the generous friendship of the ex-Khedive,
to whom he owes everything, would condemn him in the
minds of all honourable men to such mistrust and con-
tempt as exclude him from all thought for the future
government of Egypt. His only less scandalous bad
faith to ourselves, after taking office with every profession
of devotion to English policy, will probably weigh more
against him at the Foreign Office, which, strange as are
the surprises it sometimes provides for outsiders, can
hardly again trust a man with such a record as that of
Nubar during the past eight or ten months. He has
now openly declared war against our influence, and can
properly find no place in any scheme of Egyptian adminis-
tration with which England has to do. Practically,
therefore, Sherif and Riaz may be said to be the only
men of anything like first-class experience who are imme-
diately available for higher office, and, as we have found,
neither is fit, without a guiding hand and head above
him, to conduct an administration..
11
LIII
The Egyptian Problem.
37
-
The argument for annexation or a protectorate be-
comes conclusive when to the advantages which either
would secure for British interests is added the enormous
benefit that would accrue to Egypt itself. Masters of
Cairo, we should not only be able to protect the Canal
at its extremities, but every yard of its banks, from
Port Saïd to Suez Bay, would be as safe as the Nile
at Boulak. While, as regards our commerce, it is not
to be questioned that, without unfairly altering an item
in the present tariff, we should compete more favour-
ably than we do with French, German, and other
European rivals in the trade of the Delta, the Red Sea,
and the southern provinces. The same paramount
authority, and that alone, would enable us to deal
radically with all the abuses of administration which
have immemorially weighed on the fellaheen, and, for
the first time in the long history of the country, to
endow it with a stable, just, and merciful government.
To this end we should of course once again imitate
the French in Tunis, and abolish the Capitulations. In
Egypt these old conventions have long been abused far
beyond their widest interpretation in Turkey, and had
well-nigh brought administration in everything affecting
foreigners to a deadlock when the International Tribu-
nals were established eight years ago. Since then, their
mischievous operation has of course been largely checked,
but they still permit and encourage abuses, both fiscal
and judicial, such as no civilised Government could tole-
rate. This gross anachronism could not, therefore, co-
exist for a month with British supremacy. In Turkey the
protection afforded by it is still necessary, but in Egypt,
even now, it has no longer a shadow of raison d'être.
Let philanthropists, too, not forget that it is only with
the Queen as at least suzerain of Egypt, that they can
38
The Egyptian Problem.
cherish any hope of a suppression of the slave trade.
Ismaïl, it is true, despatched the three expeditions of
Baker, Gordon, and Gessi, to stamp out the traffic at its
sources, and, in the convention which promises to put an
end to slavery in Egypt itself three years hence, granted
what the Porte has persistently refused for Turkey. But
the infamous commerce still goes on, and will never
cease till British power is supreme in both the Soudan
and the Nile Valley. Such a policy as I now advocate
would, of course, necessitate our smashing' the Mahdi
and restoring order in the southern provinces, but that
is an obligation already involved in the situation as it is.
The Egyptian Government itself is powerless to stem the
advancing wave of the revolt, and by us in any case
must it be rolled back. As regards the Soudan, indeed,
our true policy is as clear as in Egypt itself. There,
as in Cairo, we have only a choice between two
courses either to Sarawak’ the eastern provinces under
an Englishman or some clean-handed Zebehr, who shall
be amenable to our influence and rule on lines that we
can approve; or, to abandon the country altogether to
the Mahdi, the slave-dealers, and barbarism ; with the
certainty of being compelled, later on, to re-conquer and
annex it at immensely greater cost. It need hardly be
said which side of the alternative common sense most
approves.
Strong, however, as may be the arguments for so
national a policy, Mr. Gladstone and his colleagues have
made it all but impossible—for the present. With a spon-
taneity that is generally as rare in politics as it was wholly
needless in this case, they hastened at an early stage of
the crisis to pledge themselves against either annexation
or a protectorate. Before sending our fleet to Alexan-
dria, they had, in common with the other parties to the
The Egyptian Problem.
39
abortive Conference of Constantinople, signed the Pro-
tocole de Désintéressement, and were bound by it for
all the purposes of that council, but no further. Yet, in
deference to French susceptibilities, Ministers went out of
their way to renew their disclaimers of any special
advantage from the overthrow of Arabi, and announced
their intention to evacuate Egypt within the memorable
six months. I ventured at the time to predict that
events would prove too strong for them, and with equal
confidence I hazard a renewal of the same prophecy
now.
Whatever, therefore, the Tories might do if a dissolu-
tion transferred the reins to their hands, the Liberal
chiefs are perforce driven to work out some other solu-
tion, and this they have seemingly found in the neutral-
ization scheme of the Anglo-French agreement. I
avow at once that I have no faith in the stability and
security of such a settlement. The idea of it involves
the double fallacy — that the Egyptian fellaheen re-
semble the Belgians, and that Egypt itself plays a
similar territorial part to that of Belgium in the balance
of European power. Both these assumptions are
wholly baseless. To say nothing of the contrast be-
tween any possible native ruler and Leopold I., the
people of the two countries differ not more widely in
race and religion than in fibre of character and fitness
for self-government; while their relations to Europe have
not historically or in present fact a single feature in com-
mon. Neutralization on the basis of the principles applied
to Belgium,' seems, indeed, at first sight to provide an
effective barrier against the greed and the rivalries of other
Powers, but even in Europe its efficiency to protect has
more than once failed. Thus, the guarantee of 1815
proved powerless thirty years later to save Cracow from
er.
40
The Egyptian Problem.
Austria ; and if, in 1869, Prussia had yielded to the
treacherous overtures of Napoleon, the Quintuple Treaty
of 1839 would have as little availed Belgium against
France. No whit more would a similar guarantee protect
Egypt, if three, five, or ten years hence England's hands
were full with another war. But even if this were less
sure, neutralization would involve the withdrawal of our
troops and the surrender of the administration back into
native hands, with, under present conditions, a certainty
of lapse into all the old abuses, to the fresh imperilment
of our own interests, and the worse-than-ever (because
independent) oppression of the fellaheen. To talk, there-
fore, of diplomacy evolving out of the degradation, the
semi-barbarism, and the oppression which have weighed
on the Nile Valley for five thousand years, an analogue
to the model kingdom on the Maas and the Scheldt, is a
mere romance of politics. But its serious proposal has
at least this advantage---that, whether the agreement'
stand or fall, it commits England and France to the
admission that the shadowy sovereignty of the Porte no
longer blocks the way to such a settlement of this ques-
tion as shall be best for the peace of Europe, and for
the people of Egypt themselves. The abandonment of
the Soudan and our own later occupation of Berbera,
both without reference to the Porte, also of course
imply this estimate of the Sultan's “rights; but to
propose to neutralize Egypt itself, over his head, is to
ignore—is almost in terms to deny—them altogether, and
that I gladly recognise as a gain which goes far to balance
the blunder of having summoned a Conference at all.
1
While what precedes is passing through the press, the
rumour is current that, mainly owing to French opposi-
tion, the scheme submitted by our Foreign Office has
The Egyptian Problem.
41
been rejected by the Conference, and that a counter-
project, framed by M. de Blignière, has found favour
instead. This, it is said, negatives the English proposal
to cut the debt coupon, but reduces from 5 to 3 per
cent, the interest on our Suez Canal shares, abolishes the
sinking-fund, and, besides accepting the proposed loan of
£8,000,000 from our own Treasury, authorises the borrow-
ing of another £1,000,000 towards the cost of our occu-
pation. A still later on dit is, that if this scheme of M. de
Blignière be not approved in its entirety, an effort will
be made to patch up an Egyptian budget for the current,
and perhaps next year, and so to leave the door open to
French intrigue for another twelve or eighteen months.
It is not conceivable that Lord Granville should accept
either of these compromises, but if he did the House of
Commons may be safely trusted to correct his mistake.
Be the truth in either rumour what it may, their
currency may be taken as evidence that the Conference
has rejected the scheme submitted by our own Govern-
ment, and so failed to arrive at any settlement which the
public sentiment of this country will approve. While I
write, Mr. Gladstone has again postponed his promised
statement as to the real result arrived at, yet another
• point' having arisen as to which the ambassadors must
consult their respective Governments before deciding.
The final upshot will, probably, be known before these
lines can reach the reader ; but it is now safe to assume
that the Conference has failed, and that we have escaped
the complications and entanglements which Lord Granville
so incontinently courted in calling it together. Neither
the fact nor the cause of it will excite much surprise even
amongst those who remember Mr. Gladstone's sanguine
statement in the House, that in consequence of the
n
42
The Egyptian Problem.
concessions made by us in the agreement,' he felt strong
hope that we might reckon on French support within the
The Prime Minister evidently forgot for the moment
that France is now a Punic Power, and, in his own utter
honesty, left out of view the possibility of punic faith'
and his colleagues in the Conference has been completely
consistent with the conduct of the French authorities in
Egypt ever since Tel-el-Kebir. At this moment, and for
most of the past two years, everything that dishonest
intrigue can do to thwart our influence and excite against
us the ill-feeling of the Egyptian people is being openly
done at Cairo and in the provinces by French agents.
The Bosphore Eyyptien, the acknowledged organ of
Nubar and the French Consulate, teems with daily abuse
of us, written expressly to be reproduced in the vernacular
prints and circulated broadcast as the independent ex-
pression of European opinion. Under the very nose of
General Stephenson, the most grossly false news of the
Mahdi's successes in the Soudan, of the defeats of our
troops, and denunciations of the dishonesty and tyranny
of our agents, are in this way fabricated and republished
in every village of the Delta and Upper Egypt—at what
cost to his secret-service fund M. Jules Ferry best knows.
Who need be reminded that if such tactics had been
attempted by Englishmen a couple or three years ago in
Tunis, M. Roustan and General Bréart would have made
short work of their critics ? But Sir E. Baring and Sir
F. Stephenson are men of milder stamp, and if only the
ægis of Monaco shields the libeller, he may vilify English
policy and the English nation to the top of his bent.
. Let us, therefore, get rid of the delusion that we have
WS.
The Egyptian Problem.
43
anything to hope from French friendship, or to fear from
French hostility, solve this problem as we may. The
failure of the Conference gives us once more a free hand,
a freer one, indeed, than we have yet had, since the
Powers now in effect declare that they leave to us the
full responsibility of dealing with the question in our own
way; for it amounts to that if any settlement be come to
which the House of Commons cannot ratify. Egypt is in
the throes not merely of a great financial crisis, but of a
life-and-death revolt, yet Europe refuses to contribute a
sixpence to meet either, and casts upon us, single-handed,
the task of dealing with both. In summoning the Con-
ference and offering the concessions we did to France, we
said in effect to the Powers- Join with us in settling this
of mutual self-denial all round. The offer has been
rejected, and henceforth our duty and our right are alike
clear—to cry, “ Hands off! we will now settle it ourselves.'
If the argument for our supremacy had needed further
emphasis, the Powers themselves have given it in fullest
measure. Technically, they may have only refused to
endorse our scheme for the relief of the Cairo Treasury, but
by doing so, they have in broad fact abandoned to us the
solution of the whole problem, with whatever consequences
the mission may bring with it. Surely, in a question of
all but paramount national importance, English states-
be the Party in power which it may. One thing, at any
rate, is certain that, however a vigorous agitation against
the House of Lords may for a time divert public attention
from this Egyptian business, not even Franchise and Re-
distribution Bills wil). long stave off recognition of its
gravity. Every month lost in resolutely grappling with
44
The Egyptian Problem,
it will only aggravate its difficulties, until even the
strongest Ministry will not easily answer to the country
for the still heavier sacrifices of money and blood which
the vindication of our national honour and interests may
yet entail.
July 28, 1884.
LONDON : PRISTED BY
SPOTTISWOODE AND CO., NEW-ST REET SQUARE
AND PARLIAMENT STREET