African Entrepreneurship Record

Certainly, the United States also realized this issue, so now the United States has picked up the script of the United Kingdom’s ”Free Trade” and is vigorously developing its naval strength.

In the original history, the United States came up with the so-called ”Open Door Policy” in September this year, demanding more opportunities for ”fair competition.”

East Africa has not yet developed to this stage of the United States, but with the development of industrialization in East Africa, in a few years, East Africa will also support the U.S. stance.

After all, the current world rules are formulated by traditional European powers like the United Kingdom and France, and other countries are quite happy to break this old world system, including East Africa.

”Continue to increase diplomatic, cultural, and political exchanges with South American countries, especially to support our agents more. Nowadays, the international market is almost completely divided, and wanting to eat more means someone has to relinquish their benefits, which is obviously not easy to achieve, so we have no choice but to continue exploring new avenues, avoid direct competition, or enhance our industrial standards and improve the competitiveness of our products,” said Ernst.

One must be strong to forge iron; if the industrial level of East Africa is further improved, then East African industrial products can compete directly with other countries, ultimately depending on whose industrial strength is stronger. Once the industrial level is elevated, it will naturally drive the development of other fields.

Just like the United States, its shift in foreign policy also resulted from the rapid expansion of its industry, which led to an increase in U.S. strength. This is the premise for the current development of the United States Navy and the guarantee of victory in the Spanish-American War.

Currently, East African industry has not yet grown in numbers and cannot be compared with other major powers. However, over time, East African industry will also enter a new explosive period.

In 1899, the previous industrial sector reforms in East Africa were basically completed, with a large number of factories newly constructed, spread across the eastern, central, and western regions, and industry had gone from non-existent to existent in the north and south as well.

In the central and eastern regions, several emerging industries in East Africa are rapidly expanding, with electricity, machinery, oil, chemicals, and machinery industries experiencing leapfrog development.

Especially in the case of electricity and automotive industries, not only have they increased in scale, but they have also accumulated a significant technological advantage. Given more time, East Africa will have a huge competitive edge in these industries’ markets over the next two to three decades.

Meanwhile, this also means that by 1899, the previous round of industrial investment in East Africa was completed, and the subsequent process involves East African industrial investment beginning to recover capital.

This is also the main reason East Africa is actively developing new consumer markets such as South America. After all, industrial products produced can’t be consumed solely by East African domestic markets; international markets are even more critical.

However, excluding each country’s colonies and spheres of influence, the regions and countries available for East Africa’s choice are limited, with South America being the only region where East Africa has not yet extensively engaged.

So Ernst said, ”In terms of exports, our main markets are Europe, the Far East, and the Middle East. Europe is the main market for East African agricultural and industrial products, while the Far East and Middle East are advantage markets. On this basis, South America will become the fourth largest market for East African trade in the future.”

”The most important factor in developing new markets is the binding of benefits so that breakthroughs can be achieved in today’s high tariff barrier environment.”

According to Ernst’s memory, several economic crises occurred in the early 20th century, especially the 1913 economic crisis which directly led to the outbreak of World War.

Therefore, in the entire early 20th century, competition in the industrial sector will only become more intense; however, the impact on East Africa should not be significant. On one hand, East Africa’s domestic market is not saturated yet; as an agricultural nation, the domestic market demand in East Africa is relatively robust.

Just like tractors, electrical equipment, cars, etc., currently, East Africa’s self-production and self-sale exceed exports, and these industries rely on emerging industries. Emerging industries’ capability to combat economic crises is far stronger than traditional industries.

In the previous round of industrial investment, East Africa has completed an industrial upgrade, eliminating a majority of backward production capacity. In the context of other countries heavily expanding their militaries, East Africa has invested more funds into technology and equipment upgrades, research, education, etc., thus occupying an advantage.

Of course, this doesn’t mean other countries’ chosen paths are wrong; naturally, if an expansion of the military allows for more colonies and markets, that can also mitigate economic risks.

However, Ernst is not optimistic about this path, at least not at this current stage, as expanding the military is more harmful than beneficial for national development.

Currently, the strength of various powerful countries is relatively balanced, making it difficult for any country to decisively go to war. Without war, the cake cannot be redistributed. Of course, the Spanish-American War should be regarded as an exception; however, the size of Cuba and the Philippines acquired by the United States is rather small, which for the U.S. is merely a drop in the ocean.

This is like East Africa purchasing Mindanao Island; Mindanao Island has a small population, is not effectively developed, so East Africa temporarily cannot gain profits from Mindanao Island.

Moreover, at present, equipment technology is undergoing rapid iteration, especially in the navy. The expansion of the United States Navy is essentially enjoying the benefits of earlier purchases, while Ernst’s naval development path is to enjoy discounts through later purchases. Before the emergence of Dreadnoughts, over the next four to five years, East Africa does not plan to significantly expand the number of warships.

In Ernst’s view, over the next few years, up until 1905, East African countries’ development should focus intensely on economic development, particularly enhancing East Africa’s industrial strength, and after 1905, consider international situation changes and formulate East African development strategies, and it will not be too late.

Of course, the frequently occurring economic crises of the early 20th century do indeed warrant Ernst’s vigilance. Although history has changed greatly, the major trends in world economic development should remain unchanged. Efforts must be made to avoid the transmission of economic crises from other countries to the mainland of East Africa, disrupting East Africa’s layout.

Certainly, such concerns are somewhat unnecessary; other countries may merely have high tariff barriers, whereas East Africa now remains in a closed-door state except for coastal cities.

With this firewall in place, even if an economic crisis does impact East Africa, only the coastal region’s economy will be affected.

Moreover, economic crises for current East Africa are not a bad thing; crises also represent opportunities, which will be more advantageous for East Africa to acquire advanced technologies and equipment from other countries.

Although East Africa itself has many industrial highlights, these are limited to emerging industries; the gap with other countries in traditional industries remains difficult to bridge, yet an economic crisis is East Africa’s opportunity.

Certainly, the introduction of new technologies and equipment to East Africa nowadays is vastly different from the seventies. During the seventies’ economic crisis, East Africa primarily resolved the problem from non-existent to existent, while in the new century, East Africa’s primary task is to complement East Africa’s industrial shortcomings, and fill in the gaps within East Africa’s industrial system, which are significantly different.

Nonetheless, this leaves Ernst with quite some regret, as in the early 20th century, East Africa cannot play the role of the Soviet Union from the previous life. Though East Africa’s economic system has some similar features to the Soviet Union, East Africa already proactively invested funds into industrial development.

However, this is not necessarily a bad thing. In the 1930s’ economic crisis, the Soviet Union quickly achieved industrialization, reaping the benefits of the Europe and America economic crisis. Though there was an impact on the Soviet Union’s industry and research, managing the degree well allows for avoidance.

By comparison, East Africa opted for a completely different path. Ernst has always pursued steady progress, and from Ernst’s perspective, a rapid industrial expansion within a short time in East Africa may not be beneficial. Otherwise, the excavation of Heixinggen’s gold mines could solve the funds needed for East African industrial development.