The plan of Engineer P. Fox for the extension of the line to Campinas having received the preference over the other traces presented to the ministry in my charge, the President of the province undertook to promote a company of planters and capitalists to carry this important benefit into effect. The company having the right of preference to the extension of the railway, I instructed our Minister in London to obtain an explicit declaration from the directory renunciatory of its right, in order that there might be no future doubts or reclamations. The directors replied that the company expressly desisted from the right, and, therefore, the association could proceed with its measures for the realisation of its object. In the opinion of Engineer E. Viriato de Medeiros the amount of capital expended up to the 30th of July, 1866, amounted to £2,548,434, but for payment of interest due it was estimated hypothetically at £2,650,000.
The provincial assembly not having empowered the President to pay the interest of two per cent. upon the guaranteed capital, to which the province had bound itself, it was necessary for the national treasury to take upon itself the satisfaction of the provincial promise. It is therefore requisite that the provincial assembly provide in the estimate of this year for relieving the public treasury from the charge upon its already too burdened coffers.
It will be seen from these reports that all the guaranteed railways are exposed to difficulties arising out of the special character of the relations existing between the various companies and the Government, and that Senhor Sobragy, the talented manager of the Dom Pedro Segundo Railway, has been sent to England to try to come to terms with the companies. In my opinion, however, nothing short of the Government taking over the railways, giving in exchange a guaranteed stock, can ever meet the requirements of the case, or bring these concerns out of their present unfavourable position. It would be useless to recapitulate here the causes of their failure. Certainly no fault can be laid to the charge of the Government, which has acted in perfect good faith towards them, and done probably more than any other Government ever did or would do to assist undertakings of this or any other kind. Rashness, ignorance, and bad advisers have led to most of their difficulties, and with such proofs of the mismanagement of railway directors on our home lines no one will be surprised at the unsuccessful result of their management of lines abroad.
As an evidence that railways can be made and properly managed by Brazilians I need only refer to the Dom Pedro Segundo, a line quite as important as any in the country. In separate chapters I have referred to this railway, and also to that in the province of San Paulo.
I believe it would be greatly to the advantage of the rising generation in Brazil if the young men were trained to become engineers, rather than lawyers or doctors, with which the towns and cities swarm. Brazilians are neither deficient in talent nor energy, if properly brought out, and the employés of the Dom Pedro Segundo are chiefly natives. The splendid road to Juiz de Fora furnishes an example of this, and I regret time did not permit me to make another visit there, which Senhor Mariano very kindly urged on me. Had it not been for the heavy expenditure of the Paraguayan war, the railway system of Brazil would doubtless have been much more extensively developed, and the provincial lines now in existence carried further into the interior, as it is impossible the latter can ever be productive of much revenue, or of much national benefit until they are prolonged to the chief centres of cultivation, which, as a general rule, lie upwards of one hundred miles from the coast. The provinces of Pernambuco and Bahia both attach great importance to railway extension to the river San Francisco, but it does not appear from the report of Captain Burton, who lately explored that river, that it is likely to yield so much traffic as is supposed. The want of population is the great drawback to railways, and until this want can be met by emigration of some kind, a large amount of internal wealth must lie waste.
My long detention in the southern part of Brazil and the River Plate prevented me visiting Bahia and Pernambuco, and judging from personal observation as to the state and condition of the railways there, or reporting on the new tramway from Caxioera to the interior, which promises to be of great utility to the country traversed by it, as well as remunerative to the shareholders interested in its future.
COMMERCE OF BRAZIL AND THE RIVER PLATE.
During the unfruitful dominion of Spain and Portugal, commerce with South America was limited to the exchange of commodities between the mother countries and the populations planted in the New World revealed to Europe by the daring genius of the great Genoese navigator and those bold spirits who after him traversed and explored strange oceans and seas unknown. The Courts of Madrid and Lisbon adopted the most stringent measures for the preservation of their monopoly and to prevent commercial intercourse with their colonies by the subjects of foreign States. So successful were the means taken to this end that very little was known with certainty in England concerning those immense regions until after the War of Independence freed them from the yoke under which they had so long groaned. I need not in this place indicate all the causes that led to this great revolution, but there can be no doubt the example of our own American colonists and the principles disseminated by the French Revolution exercised a potential influence in stirring the South American communities to liberate themselves from the oppressive restrictions with which they were fettered.
The marauding exploits of Admiral Drake, and the rich prizes captured on the Spanish main, had given our countrymen some notion of the incalculable wealth of Chili and Peru, the Brazils, and the Rio de la Plata; and their erection into separate and Sovereign States was hailed as the advent of a new and prosperous era for the commerce of both hemispheres. With a liberality and promptitude which will always be remembered by the various South American nations, the capitalists of Britain responded to their demands for pecuniary aid, and loans were freely subscribed to enable the enfranchised peoples to establish popular self-government upon solid bases. It may be said that this still remains to be accomplished, and the frequently recurrent revolutions in Bolivia and Peru, and in some others of the nascent Republics, are certainly no manifestation of executive stability; but it must not be forgotten that their antecedents, under the Spanish and Portuguese control, were not of a nature to fit them for a wise and temperate exercise of political privileges. Year by year, however, with the growth of intelligence and the spread of education, the respective States are becoming less subject to internal and civil convulsions; and in this respect the rapid development of industrial and productive activity gives promise of a still more satisfactory condition of things in the proximate future.
Since the abrogation of the monopolies of Spain and Portugal and the inauguration of free intercourse with South America the commercial movements between that part of the globe and the maritime nations of Europe have assumed imposing proportions, and are every year increasing in value and importance. As elsewhere, England holds a high place both in the Pacific and Atlantic markets, as an importer of products and an exporter of manufactured goods. Our Board of Trade Returns show the magnitude of British interests in those countries, and the necessity that exists for promoting the most cordial relations with the different Governments. But at present I must confine my observations to Brazil and the River Plate, and from a reference to the returns in question it will be seen that the former is our largest South American customer, taking commodities to the annual value of £5,822,918, while we in return receive Brazilian produce of the annual value of £5,902,011. The River Plate comes next in order, taking English goods of the annual value of £4,405,548, while it sends to us produce worth £2,146,079. It will appear, therefore, that the total movements between this country and Brazil and the River Plate are respectively of the yearly value of £11,724,929 and £6,545,627. And here I may state, without going into particulars, that the entire commercial movement between England and the whole of South America reaches the no inconsiderable sum of £34,566,405. The above returns are for the year 1867.[[6]]