EGYPT. 



235 



the sinking funds, but Sadyk Pasha found his 

 own profit in his master's embarrassments, and 

 plunged him in irretrievable ruin. In 1874 an 

 attempt was made to raise 5,125,000 by a 

 forced loan, the Kouznameh internal loan, but 

 not one half of it could be obtained. In 1874 

 Sadyk proposed to convert the whole debt, 

 and arranged to pay 15 per cent interest and 

 2 per cent commission to the Anglo-Egyptian 

 Bank for funds for that purpose. In 1876, soon 

 after Cave had given his encouraging report to 

 Lord Derby of the finances of Egypt, Sadyk 

 stirred up the British bondholders by proceed- 

 ing to convert all the debts into one, called the 

 Unified, and giving the bankers who had ad- 

 vanced money an advantage over the old bond- 

 holders. Goschen came as the agent of the 

 bondholders and compelled the Khedive to re- 

 verse this arrangement and give the holders of 

 the earlier issues a bonus of 25 per cent of the 

 capital and accrued interest, and a prior claim 

 upon revenues of the railways and other public 

 works. In 1877 the Viceroy handed over his 

 Daira estates to meet the Daira coupons. The 

 revenue from these, the Khedive's private 

 estates, was $2,250,000 a year. Mr. Romaine, 

 Baron Maloret, and Captain Baring had already 

 taken in charge the state revenues. It was 

 impossible to satisfy the Goschen arrangement, 

 although the fellaheen were bastinadoed as 

 they never had been before, and the taxes were 

 collected in advance. When Mr. Romaine pro- 

 posed to reduce the land-tax so that the people 

 might live, Major Baring, on behalf of the 

 bondholders, refused to allow it. In 1878 the 

 International Courts levied on the Khedive's 

 furniture, and he turned their officers out of 

 his palace, alleging that it belonged to his 

 mother. Sir Rivers Wilson and M. de Bli- 

 gnires carne at this crisis, and the Khedive 

 handed over the whole direction of affairs to 

 them, the first taking the role of Minister of 

 Finance, the second of Public Works. They 

 took away the only source of revenue which 

 had not been given over to the bondholders 

 the domains of the khedivial princes, with a 

 rental of $2,150,000. They cut down the army 

 budget and other items, and proceeded to ne- 

 gotiate a new loan with Rothschild on the 

 security of this property. Baron Rothschild 

 withheld the money when he found that the 

 domains were already affected by a lien. In 

 February, 1879, occurred in consequence the 

 entente of unpaid officers. The European minis- 

 ters were dismissed by Ismail, as the only way 

 to save his life and prevent a massacre of 

 Europeans. Lord Salisbury and Minister Wad- 

 dington resented this act, and compelled the 

 Sultan to depose Ismail, and appoint his son 

 Tevfik to reign in his place by a hatt which 

 was issued in June, 1879. 



In July, 1880, the International Commission 

 made a new settlement of the debt, converting 

 the floating debt into bonds, and fixing the 

 total obligations of Egypt as given in the fol- 

 lowing table : 



Unified 57,776,340 



Preferred 22,587,800 



Daira 9,512,870 



Domain 8,499.620 



Moukabalah 7,500,000 



Total 105,876,630 



According to the terms of this final settle- 

 ment the unified debt was to draw 4 per cent 

 interest; the preference debt, 5 per cent. The 

 holders of the Daira and domain mortgage 

 bonds were to have the net revenues from the 

 lands. The Moukabalah debt belonged to a 

 different category. It was a forced loan raised 

 from the peasantry, who paid in the whole of 

 the capital. For the payment in advance of 

 six years' taxes they were promised the remis- 

 sion of half the land-tax after 1885. The debt 

 was nominally 17,000,000, of which certainly 

 10,000,000 had been paid in by the peasants. 

 The Moukabalah law was a ruinous device of 

 the Khedive, while he was floundering in the 

 nets of the foreign usurers and contractors, to 

 raise money to meet his present obligations by 

 sacrificing the source of supply. The Control- 

 lers and Sir Rivers Wilson, acting solely in the 

 interests of the foreign creditors, not only re- 

 pudiated the solemn engagement of the Khe- 

 dive, whereby the peasantry were redeeming 

 one half the land-tax in perpetuity, but boldly 

 confiscated the millions which had been wrung 

 from the peasantry. Ismail had himself re- 

 voked the Moukabalah law in 1876, and de- 

 creed compensation in the shape of 7 per cent 

 annuities running sixty -five years ; but at the 

 demand of Goschen, who wanted the 1,500,- 

 000 paid in annually by the peasantry on this 

 account, in order to redeem certain of the 

 short loans, he almost immediately re-estab- 

 lished it. If it had not been for Nubar Pasha 

 and some Greek capitalists, who had purchased 

 land at the reduced assessments, the holders of 

 the Moukabalah obligations would have lost 

 everything ; but through the prayers of these 

 individuals they were accorded 150,000 a 

 year for fifty years. The preferred bond- 

 holders were guaranteed the net receipts of 

 the railways and of the port of Alexandria be- 

 ing reserved to meet the interest. If these 

 sources were insufficient, they were given a 

 prior claim upon the general revenues. The 

 interest on the unified debt was to be paid out 

 of the general revenues after the interest on 

 the preferred bonds was paid up and the cost 

 of Government within the limits fixed by the 

 commission was provided for. 



Ismail did not squander the capital borrowed 

 in Europe, as has been often represented, since 

 he actually paid out more than the entire pro- 

 ceeds of the loans on useful and productive 

 public works. The total sum expended on 

 public works during his reign was $231,320,- 

 000, while the entire net product of the loans 

 was $210,000,000. The expenditures were as 

 follow: On the Suez Canal, over and above 

 the value of shares sold, $33,850,000; 8,400 

 miles of Nile canals constructed at $4,500 a 

 mile, $37,800,000; 430 bridges built, averag- 



