Chapter 331: Chapter 14 Double Standards
The Heixinggen Bank is the core component of the Heixinggen conglomerate, or you could say the backbone, with several large enterprises under its umbrella extending as branches from this backbone, and the branches are surrounded by many leaves, including these enterprises’ business partners, raw material suppliers, sales outlets, small companies and businesses invested in by the Heixinggen Bank, and so forth, with the bank’s headquarters serving as the brain of the conglomerate.
It’s certainly impossible for the main body of the conglomerate to relocate to East Africa, as East Africa cannot currently support the development of such a world-class conglomerate. However, the bank’s headquarters can first relocate to the local East African region; as long as communication remains smooth, it can continue to command the operation of the entire conglomerate.
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Ernst: "This matter is settled for now. Next up, let’s discuss the second issue, regarding the textile industry, which is overseen by Kleisen, right?"
Kleisen: "Yes, Your Highness."
Ernst: "Could you share with everyone the situation in the textile industry last year and this year?"
Kleisen: "Certainly, Your Highness. This year, the textile industry is developing well, especially since a significant wave of production capacity burst forth with the outbreak of war last year. We received numerous orders from Germany and the Austria-Hungary Empire, and the Far East’s abundance of cheap labor and the high efficiency of new factories have allowed us to relieve the pressure on European factories, being the first among our peers to free up machines and workers to ensure a continuous and stable supply of military orders.
The military has always been the best client. Last year alone, the North German region in Germany expanded its army by a scale of one million, whereas previously, the North German Federation’s army size was about sixty thousand. During the Austro-Italian War and in the mid to late stages of the war, Austria also recruited two hundred thousand troops from the rear, along with the Southern German states at the time. The Franco-Prussian War and the Austro-Italian War nearly contributed a million strong military market. A single soldier required multiple sets of uniforms, especially since these wars spanned summer to winter, leading to a massive supply of winter clothing. However, in the late stages of the war, competing factories also ramped up production, which diverted some orders from our subordinate enterprises and investment factories.
Just in military uniforms alone, we made a significant profit thanks to low production costs, ample capacity, and a first-move advantage.
And let’s not forget, besides military uniforms, we also profited greatly from related products such as beddings, sheets, backpacks, army boots, etc. Of course, this still pales compared to our strongest areas, finance and investment."
The last sentence is essentially nonsense; Heixinggen Bank’s specialty must be finance. With gains of nearly one-third from the profits of the Franco-Prussian and Austro-Italian wars, the profits are astronomical, nearly tripling the conglomerate’s scale compared to before the war.
Ernst summarized: "The textile industry is extremely profitable. Currently, the conglomerate’s textile industry can be divided into two categories based on equity. The first category includes independently owned enterprises and factories, and the second consists of textile enterprises in the US and European regions we’ve invested in (primarily benefiting from loans through the bank). I won’t discuss the second category for now; let’s mainly focus on our own enterprises.
Currently, the textile industry is primarily concentrated in the Heixinggen Daily Necessities Company, managed through Heixinggen Daily Necessities Company. This situation is similar to the original food processing industry. The size of the textile industry has now reached the condition where it can stand independently. So, for easier management, I have decided to separate the textile industry from Heixinggen Daily Necessities Company, forming a new textile group, to be operated as a subsidiary directly under Heixinggen Bank. What are your thoughts?"
The consensus was unanimous in supporting the boss’ decision; the textile industry should have been separated from Heixinggen Daily Necessities Company long ago.
Since the establishment of the Far Eastern textile factory, the production capacity of Heixinggen Conglomerate’s textile industry has reached top-tier levels. With the Nairobi textile factory currently under construction, the Heixinggen Conglomerate holds substantial influence in the global textile industry.
Ranking just behind the four countries: UK, US, France, and the Far East, in fifth place worldwide. Previously, the Kingdom of Italy held the fifth position globally, but its textile industry suffered a crippling blow from the war, causing the loss of industrially developed regions like Venice and parts of Lombardy and the domestic market in Naples.
The reason for this comparison with countries is that the Heixinggen Conglomerate, besides dominating the East African Kingdom’s textile market, also holds a certain market share in the textile industries of Germany, the Austro-Hungary Empire, Tsarist Russia, and countries in the Far East.
As for the four countries: UK, US, France, and the Far East, they inherently have gargantuan capacity, vast populations, and massive raw material supply sources.
The most typical example is the US, where the combination of Southern cotton plantations and Northern industry has rapidly enhanced domestic production capacity.
There’s not much to say about the UK; holding India as a trump card is enough. France is also an old major power, and Napoleon III is skilled in economic development, thus their textile industry remains firmly in the top five globally.
The Far East, with a vast scale, could reach a world-class level just through handicraft. Alongside the recent establishment of numerous government-run factories in coastal regions due to the Self-Strengthening Movement, efficiency is also improving. However, due to government-run management, it’s more rigid, lagging behind the industrial investments from Britain, France, and East African factories in China at the time.
Currently, the largest and most advanced factory in the Far East is the Jiaozhou Textile Factory, which counts as East African industry, considering all negotiations with local officials in Jiaozhou are handled through the East African consulate there.
Apart from the above-mentioned countries, Belgium and the rapidly developing Japan are also strong in the textile sector, with the Austro-Hungary Empire, Germany, and Tsarist Russia also performing decently. However, the textile industries in the Austro-Hungary Empire and Germany have significant overlaps with those under the Heixinggen Conglomerate.
Overall, the world in 1871 is in a stage of extreme prosperity. Even Paraguay, a country almost destroyed by war, is recovering with continuous support from Italian immigrants.
The Kingdom of Italy and France are relatively unfortunate. However, compared to the Italian Kingdom now in complete disarray, France, despite suffering significant losses in the north due to defeat, is seeing promising development in the south, led by Marseille.
Northern France will not be stable either; as Ernst holds the meeting, the citizens of Paris, an old region, are about to once again lead the world. Today is March 21st, and there are seven days left.
Ernst is well aware of the significance of this movement, but does not concern himself with it. It resembles the sudden transition of African indigenous people from primitive society into a capitalist society—they’re not equipped for capitalism. In fact, a slave kingdom society is more suitable for the current African natives. Understanding the concept of a slave kingdom already counts as progress, while feudal kingdoms are too advanced for African natives. Being abruptly thrust into a capitalist society by colonizers is bound to distort their scriptures, turning it into a uniquely African tribal capitalism.
East Africa is also proceeding in this way, never attempting to transform African tribes and kingdoms—those that are conquered are simply wiped out. The ones that weren’t wiped out continue to maintain the status quo in West Africa; collaborating with East Africa is naturally best. When it comes to arms and industrial goods, they just need to pay. Whether you’re a tribe, slave owner, king, or just a village chief, it makes no difference.
In a nutshell, East Africa doesn’t interfere in indigenous internal affairs—those who are slave owners should continue being slave owners, those who are chiefs should stay chiefs, those who are kings should remain kings, as long as they do not oppose East Africa or conflict with East African interests.
Hmm, thinking about it like this, the surrounding natives in East Africa are indeed in a tough spot—it all hinges on the conscience of the East African Kingdom. However, when Ernst embarked on the colonial enterprise, it was clear that he possessed none of that.