Turkey, the Great Powers, and the Bagdad Railway: A study in imperialism

by Edward Mead Earle

The First Rails Are Laid

During the summer of 1888 the Oriental Railways—from the Austrian frontier, across the Balkan Peninsula via Belgrade, Nish, Sofia, and Adrianople, to Constantinople—were opened to traffic. Connections with the railways of Austria-Hungary and other European countries placed the Ottoman capital in direct communication with Vienna, Paris, Berlin, and London (via Calais). The arrival at the Golden Horn, August 12, 1888, of the first through express from Paris and Vienna was made the occasion of great rejoicing in Constantinople and was generally hailed by the European press as marking the beginning of a new era in the history of the Ottoman Empire. To thoughtful Turks, however, it was apparent that the opening of satisfactory rail communications in European Turkey but emphasized the inadequacy of such communications in the Asiatic provinces. Anatolia, the homeland of the Turks, possessed only a few hundred kilometres of railways; the vast areas of Syria, Mesopotamia, and the Hedjaz possessed none at all. Almost immediately after the completion of the Oriental Railways, therefore, the Sultan, with the advice and assistance of the Ottoman Public Debt Administration, launched a program for the construction of an elaborate system of railway lines in Asiatic Turkey.[1]

The existing railways in Asia Minor were owned, in 1888, entirely by French and British financiers, with British capital decidedly in the predominance. The oldest and most important railway in Anatolia, the Smyrna-Aidin line—authorized in 1856, opened to traffic in 1866, and extended at various times until in 1888 it was 270 kilometres in length—was owned by an English company. British capitalists also owned the short, but valuable, Mersina-Adana Railway, in Cilicia, and held the lease of the Haidar Pasha-Ismid Railway. French interests were in control of the Smyrna-Cassaba Railway, which operated 168 kilometres of rails extending north and east from the port of Smyrna. It was not until the autumn of 1888 that Germans had any interest whatever in the railways of Asiatic Turkey.[2]

The first move of the Sultan in his plan to develop railway communication in his Asiatic provinces was to authorize important extensions to the existing railways of Anatolia. The French owners of the Smyrna-Cassaba line were granted a concession for a branch from Manissa to Soma, a distance of almost 100 kilometres, under substantial subsidies from the Ottoman Treasury. The British-controlled Smyrna-Aidin Railway was authorized to build extensions and branches totalling 240 kilometres, almost doubling the length of its line. A Franco-Belgian syndicate in October, 1888, received permission to construct a steam tramway from Jaffa, a port on the Mediterranean, to Jerusalem—an unpretentious line which proved to be the first of an important group of Syrian railways constructed by French and Belgian promoters. Shortly afterward the concession for a railway from Beirut to Damascus was awarded to French interests.[3]

But the great dream of Abdul Hamid was the great dream of Wilhelm von Pressel: the vision of a trunk line from the Bosporus to the Persian Gulf, which, in connection with the existing railways of Anatolia and the new railways of Syria, would link Constantinople with Smyrna, Aleppo, Damascus, Beirut, Mosul, and Bagdad. As early as 1886 the Ottoman Ministry of Public Works had suggested to the lessees of the Haidar Pasha-Ismid Railway that they undertake the extension of that line to Angora, with a view to an eventual extension to Bagdad. The proposal was renewed in 1888, with the understanding that the Sultan was prepared to pay a substantial subsidy to assure adequate returns on the capital to be invested. The lessees of the Haidar Pasha-Ismid line, however, were unable to interest investors in the enterprise and were compelled to withdraw altogether from railway projects in Turkey-in-Asia. Thereupon Sir Vincent Caillard, Chairman of the Ottoman Public Debt Administration, endeavored to form an Anglo-American syndicate to undertake the construction of a Constantinople-Bagdad railway, but he met with no success.[4]

The opportunity which British capitalists neglected German financiers seized. Dr. Alfred von Kaulla, of the Württembergische Vereinsbank of Stuttgart, who was in Constantinople selling Mauser rifles to the Ottoman Minister of War, became interested in the possibilities of railway development in Turkey. With the coöperation of Dr. George von Siemens, Managing Director of the Deutsche Bank, a German syndicate was formed to take over the existing railway from Haidar Pasha to Ismid and to construct an extension thereof to Angora. On October 6, 1888, this syndicate was awarded a concession for the railway to Angora and was given to understand that it was the intention of the Ottoman Government to extend that railway to Bagdad via Samsun, Sivas, and Diarbekr. The Sultan guaranteed the Angora line a minimum annual revenue of 15,000 francs per kilometre, for the payment of which he assigned to the Ottoman Public Debt Administration the taxes of certain districts through which the railway was to pass. Thus came into existence the Anatolian Railway Company (La Société du Chemin de Fer Ottomane d’Anatolie), the first of the German railway enterprises in Turkey.[5]

The German concessionaires were not slow to realize the possibilities of their concession. They elected Sir Vincent Caillard to the board of directors of their Company, in order that they might receive the enthusiastic coöperation of the Ottoman Public Debt Administration and in order that they might interest British capitalists in their project. With the assistance of Swiss bankers they incorporated at Zurich the Bank für orientalischen Eisenbahnen, which floated in the European securities markets the first Anatolian Railways loan of eighty million francs—more than one fourth of the loan being underwritten in England. Shortly thereafter this same financial group, under the leadership of the Deutsche Bank, acquired a controlling interest in more than 1500 kilometres of railways in the Balkan Peninsula, by purchasing the holdings of Baron Hirsch in the Oriental Railways Company. The Bank für orientalischen Eisenbahnen became a holding company for all of the Deutsche Bank’s railway enterprises in the Near East.[6]

Under the direction of German engineers, in the meantime, construction of the Anatolian Railway proceeded at so rapid a rate that the 485 kilometres of rails were laid and trains were in operation to Angora by January, 1893. About the same time a German engineering commission, assisted by two technical experts representing the Ottoman Ministry of Public Works and by two Turkish army officers, submitted a report on their preliminary survey of the proposed railway to Bagdad. This was enthusiastically received by the Sultan, who reiterated his intention of constructing a line into Mesopotamia at the earliest practicable date.[7]

In 1887 there was no German capital represented in the railways of Asiatic Turkey. Five years later the Deutsche Bank and its collaborators controlled the railways of Turkey from the Austro-Hungarian border to Constantinople; they had constructed a line from the Asiatic shore of the Straits to Angora; they were projecting a railway from Angora across the hills of Anatolia into the Mesopotamian valley. In coöperation with the Austrian and German state railways they could establish through service from the Baltic to the Bosporus and, by ferry and railway, into hitherto inaccessible parts of Asia Minor. Almost overnight, as history goes, Turkey had become an important sphere of German economic interest. Thus was born the idea of a series of German-controlled railways from Berlin to Bagdad, from Hamburg to the Persian Gulf!

The Ottoman Government apparently was well pleased with the energetic action of the German concessionaires in the promotion of their railway enterprises in Turkey. In any event, a tangible evidence of appreciation was extended the Anatolian Railway Company by an imperial iradé of February 15, 1893, which authorized the construction of a branch line of 444 kilometres from Eski Shehr (a town about midway between Ismid and Angora) to Konia. The new line, like its predecessor, was guaranteed a minimum annual return of 15,000 francs per kilometre, payments to be made under the supervision of the Ottoman Public Debt Administration. The obvious advantages of developing the potentially rich regions of southern Anatolia, and of providing improved communication between Constantinople and the interior of Asia Minor, led the Anatolian Company to hasten construction, with the result that service to Konia was inaugurated in 1896.[8]

Simultaneously with the granting of the second Anatolian concession the Sultan authorized an important extension to the French-owned Smyrna-Cassaba Railway. The existing line was to be prolonged a distance of 252 kilometres from Alashehr to Afiun Karahissar, at which latter town a junction was to be effected with the Anatolian Railway. Another French company was awarded a concession for the construction of the Damascus-Homs-Aleppo railway, in Syria, under substantial financial guarantees from the Ottoman Treasury. It was said that these concessions to French financiers were “compensatory” in character and were granted upon the urgent representations of the French ambassador in Constantinople.[9]

Between 1896 and 1899 no further definite steps were taken to extend the Anatolian Railway beyond Angora, as had been provided by the original concession. In the latter year, however, largely because of Russian objections to the further development of railways in northern Asia Minor, the Sultan took under consideration the advisability of projecting and building, instead, a line from Konia to Bagdad via Aleppo and Mosul. Early in 1899 a German commission left Constantinople to make a thorough survey of the economic and strategic possibilities of such a line. Included in the commission were Dr. Mackensen, Director of the Prussian State Railways; Dr. von Kapp, Surveyor for the State Railways of Württemberg; Herr Stemrich, the German Consul-General at Constantinople; Major Morgen, German military attaché; representatives of the Ottoman Ministry of Public Works. It was this commission that finally decided upon the route of the Bagdad Railway.[10]

At the close of the nineteenth century, therefore, the sceptre of railway power in the Near East was passing from the hands of Frenchmen and Englishmen into the hands of Germans. In a period of about ten years the German-owned Anatolian Railway Company had constructed almost one thousand kilometres of railway lines in Asia Minor. A German mission was blazing a trail through Syria and Mesopotamia for the extension of the Anatolian Railway to the valley of the Tigris River and the head of the Persian Gulf. German prestige seemed to be in the ascendancy: the Directors of the Anatolian Company reported to the stockholders in 1897 that, “as in former years, our Company has concerned itself continuously with the development of trade, industry, and agriculture in the region served by the Railway. As a result our enterprise has enjoyed in every sense the whole-hearted support and the powerful protection of His Majesty the Sultan. Our relationships with the Imperial Ottoman Government, the local authorities, and all classes of the people themselves are more cordial than ever.”[11]

The system of railways thus founded had been conceived by a German railway genius; it had been constructed by German engineers with materials made by German workers in German factories; it had been financed by German bankers; it was being operated under the supervision of German directors. In the minds of nineteenth-century neo-mercantilists this was a matter for national pride. A Pan-German organ hailed the Anatolian Railways and the proposed Bagdad enterprise in glowing terms: “The idea of this railway was conceived by German intelligence; Germans made the preliminary studies; Germans overcame all the serious obstacles which stood in the way of its execution. We should be all the more pleased with this success because the Russians and the English busied themselves at the Golden Horn endeavoring to block the German project.”[12]