Ottoman Concern about Western Economic Penetration in the Levant, 1849-1856

Abstract

HE Ottoman Turkish government was plagued in the mid-nineteenth century by a series of ever present economic problems. It was embarrassed constantly by an inflated currency, by a debased coinage, and by a very unfavorable balance of trade with the West. It had to deal at the time with a chronic deficit in receipts over expenditures in its fiscal affairs; and it was plagued even by a depression of the economic interests of the Moslems and decline of the Turkish Mohammedan population under the handicap of a set of one-sided trade arrangements with the West. Hence the dominant element at Constantinople, although it required the support of the West in diplomacy and even in war and was to a large degree favorably inclined toward the idea of the Westernization and modernization of much in the Ottoman state, adhered largely to the view that it must needs deal out reforms sparingly, for it had to be on guard against Western economic penetration of the Levant, as well as against the political and military challenge of the Russians. As a result, the Ottomans moved circumspectly in making commitments to the West for loans-the sine qua non of reforms and of active participation in the Crimean War -and especially in the years 1849-50. There existed in Europe in those years a pronounced trend toward reaction, and there loomed in Turkey no end of fiscal difficulties and a larger and larger deficit in the state's accounts. Well aware of the Porte's financial embarrassments, Sir Stratford Canning, the British ambassador to Turkey, in a long memorandum, which he presented personally to the sultan on August 22, 1850, outlined a comprehensive plan of reform and gave his support strongly to the idea of the Porte's having resort to a foreign loan.' He glowingly described the attractive terms upon which the Ottomans might secure financial support abroad. The produce of certain mines, a portion of the customs, or the tribute from some large province of the empire, would each be sufficient to satisfy any judicious capitalist as to security, and to command comparatively advantageous terms, so Canning contended. There might be raised after this manner five or six million pounds sterling at 4 per cent interest and repayable over a period of twenty-five years. Certainly with such a sum as that the Porte could retire its interest-hearing Kaimes or warrants against future revenues, withdraw its debased coins, and pay cash for its purchases. Canning was so optimistic in picturing how the proposed loan might profit the Turkish state and might clear the way for his every suggestion in reform that he contended that the Porte might make savings through the loan's use amounting to some ?10,000,000 sterling-a total greater than that of the loan's capital sum plus the cost of the improvement of the Turkish medium of exchange. He asserted that the Ottomans need have no fears even though unforeseen calamities might arise to derange these calculations. Where, he asked, was there the example of a nation that had been called upon to sacrifice its independence to the demands of foreign capitalists? There were some amongst the sultan's trusted advisers, including the leader in reform, Reshid Pasha, who thought well of all this, but the sultan, Abdul Medjid, very much under the influence of his brothers-in1 Memorandtum of Canning to the sultan, Aug. 22, 1850, Public Record Office MSS, Foreign Office (F.O.) 78/822.