The most serious obstacle to the progress of Egypt has been the authority of the mixed administrations, the chief of which is the Caisse de la Dette. The main object of these administrations is to secure for European bondholders payment of the debts incurred by Egypt chiefly under the incredibly profligate government of Ismail Pasha. The Caisse de la Dette has commissions from six of the Powers. It receives from the tax-gatherer all the taxes apportioned to the payment of the interest for foreign indebtedness. Its influence, however, extends much farther, and the Caisse exercises the right of prohibiting expenditure on the part of the Egyptian government until its own demands for current interest have been complied with. It further has the right to veto any loan which the Egyptian government might be willing to raise, however urgent the necessity might be, unless it can be demonstrated that there is not the least likelihood that payment of the shareholders whom the Caisse represents will be in the least degree affected. If all that the Caisse claimed as belonging to its jurisdiction were really allowed to it by the Anglo-Egyptian government, the Caisse or International Court might exercise an arbitrary control over Egyptian affairs. It has many times seriously attempted to block the progress of Egypt with the sole aim of considering the pockets of the foreign shareholders, and in entire disregard to the welfare of the people.
Added to this tribunal is the Railway Board and the Commissions of the Daira and Domains. The Railway Board administers the railroads, telegraphs, and the port of Alexandria. The Daira and Domains Commissions administer the large estates, mortgaged to the holders of the loans raised by Ismail Pasha under these two respective names. The Daira Estate yielded a surplus over and above the amount of interest on the debt paid, for the first time, in 1890. The Domain Estate had to face a deficit until the year 1900. Until these respective dates the Egyptian government itself was obliged to pay the deficit due to the bondholders.
In the year 1884, the Convention of London was signed by the European Powers, which was, however, for the most part, oppressive and unjust to the Egyptians. The amount of money raised by taxation, which was allowed to be spent in one year, was limited to the definite sum of $25,927,890. Fortunately for Egypt, the London Convention had one clause by which $44,760,000 could be utilised for the development of the country. With this sum the indemnities of Alexandria were paid, defects in the payment of interest were made good, and a small sum was left wherewith to increase irrigation and other useful works. The criminal folly of the former lavish expenditure was now demonstrated by a brilliant object-lesson. This small sum, when kept out of the hands of the rapacious bondholders, and applied to the development of the rich soil of Egypt, was found to work wonders. From the moment when the finances of Egypt were for the first time used to develop what is naturally the richest soil in the world, progress towards betterment grew rapidly into the remarkable prosperity of to-day. For a time, however, the government was obliged to use extreme parsimony in order to keep the country from further falling under the control of the irresponsible bondholders. Finally, in the year 1888, Sir Evelyn Baring wrote to the home government that the situation was so far improved that in his judgment “it would take a series of untoward events seriously to endanger the stability of Egyptian finance and the solvency of the Egyptian government.” The corner had been turned, and progressive financial relief was at length afforded the long-suffering Egyptian people in the year 1890. After several years of financial betterment, it was decided to devote future surpluses to remunerative objects, such as works of irrigation, railway extension, the construction of hospitals, prisons, and other public buildings, and in the improvement of the system of education. Great difficulty was experienced in making use of this surplus, on account of technical hindrances which were persistently placed in the way of the Egyptian government by the Caisse de la Dette. These difficulties are now almost entirely removed.
In 1896 it was decided, as has been narrated, to be for the interest of Egypt to start a campaign against the dervishes. Appeal was made to the Caisse de la Dette to raise additional funds for the necessary expenses of the projected campaign. The Caisse, following its universal precedent, immediately vetoed the project. England then made special grants-in-aid to Egypt, which both aided the Egyptian government and greatly strengthened her hold upon Egypt. By means of this timely assistance, Egypt was enabled successfully to pass through the period of increased expenditure incurred by the reconquest of the Sudan.
During the lifetime of Khedive Tewfik, who owed his throne to the British occupation, there had been little or no disagreement between the British and Egyptian authorities. In the year 1887 Sir Henry Drummond Wolff prepared a convention, in accordance with which England promised to leave Egypt within three years from that date. At the last moment the sultan, urged by France and Russia, refused to sign it, and the occupation which these two Powers would not agree to legalise even for a period of three years was now less likely than ever to terminate. The following year Tewfik dismissed Nubar Pasha, who had, by the advice of the foreign Powers, stood in the way of reforms planned by the English officials.
Tewfik died in 1892, and was succeeded by Abbas Hilmi Pasha, called officially Abbas II. He was born in 1874, and was barely of age according to Turkish law, which fixes magistracy at eighteen years of age in the case of the succession to the throne. He came directly from the college at Vienna to Cairo, where his accession was celebrated with great pomp; and the firman, confirming him in all the powers, privileges, and territorial rights which his father had enjoyed, was read from the steps of the palace in Abdin Square. For some time the new khédive did not cooperate with cordiality with Great Britain. He was young and eager to exercise his power. His throne had not been saved for him by the British, as his father’s had been, and he was surrounded by intriguers, who were scheming always for their own advantage. He at first appeared almost as unprogressive as his great-uncle, Abbas I., but he later learned to understand the importance of British counsels. During his visit to England in 1899 he frankly acknowledged the great good which England had done in Egypt, and declared himself ready to cooperate with the officials administering British affairs. This friendliness was a great change from the disposition which he had shown in previous years, during the long-drawn-out dispute between himself and Sir Evelyn Baring regarding the appointment of Egyptian officials. The controversy at one time indicated a grave crisis, and it is reported that on one occasion the British agent ordered the army to make a demonstration before the palace, and pointed out to the young ruler the folly of forcing events which would inevitably lead to his dethronement. The tension was gradually relaxed, and compromises brought about which resulted in harmony between the khédive and the British policy of administration, and no one rejoiced more than Abbas Hilmi over the victory of Omdurman.
