African Entrepreneurship Records 2

Chapter 1487 Seventh Five-Year Plan
By 1930, the economic crisis had spread to most parts of the world. The economies of the former three industrial giants, the United States and Germany, had completely collapsed, and the East African market was also facing severe external economic shocks.

With the plunge in world agricultural and industrial product prices, overseas orders dropped significantly at the end of 1929 and foreign trade companies had difficulties in operating. However, this was not a big problem for East Africa. After all, East Africa had been adjusting its economic policies since the s. In other words, East Africa had been preparing for this economic crisis since ten years ago.

This was a social and economic reform that lasted for ten years, and because there was ample preparation time, East Africa did not have to adopt radical policies like the Roosevelt administration later did.

Of course, this also led to the fact that in the 1920s, East Africa's economic growth rate was not as good as that of the United States or even Western Europe, but in the long run, it is obvious that this steady social reform is very beneficial to East Africa.

However, East Africa also suffered losses in the face of the great world economic crisis in 1929. The setback in foreign trade also affected the development of local enterprises in East Africa, and the unemployment rate rose. Although it was not as exaggerated as in Europe and the United States, it also had certain negative effects.

1930 was a critical year for East Africa. The compilation of the Seventh Five-Year Plan officially began, which determined the direction of East Africa's economic policies in the future.

East African Congress.

East African Labour Party MP Rawlson is giving a speech: "At the end of 1929, most countries in the world were wailing, with stock markets collapsing, banks and companies going bankrupt, especially in the United States and Germany, where the number of unemployed people reached over a million. In contrast, the Soviet Union's economic performance in 1929 was very impressive."

"In 1929, the Soviet Union's first five-year plan was officially implemented. Now the Soviet Union is rapidly industrializing, with a large number of modern factories and enterprises established."

"At the same time, we should also note that in the decade before the Soviet Union implemented its first five-year plan, the Soviet Union was also the fastest growing economy in Europe."

"This fully demonstrates the drawbacks of the free market economy and also illustrates the necessity of unified government regulation and intervention in the economy. Otherwise, East Africa will sooner or later follow in the footsteps of European and American countries."

Before the formal implementation of the first five-year plan, the Soviet Union's economic development had actually surpassed other European countries, which is easily overlooked.

In the economic field, stimulated by the new economic policy, the Soviet Union's industry and agriculture quickly returned to the level of Tsarist Russia before World War I. Although it seemed that there was no change, the meaning was completely different. For example, no matter how high the grain output of Tsarist Russia was, the Russian people still could not eat enough; no matter how strong the industry was, ordinary workers still lived in poverty and had no freedom and dignity.

At the same time, the Soviet Union reshaped its government finances. In the imperial era, corruption was a serious problem, and wealth was concentrated in the hands of the nobles and capitalists. The treasury was very empty, but the Soviet government controlled a large amount of resources and wealth. At least at this stage, these resources and wealth still belonged to all Soviet people, and they were truly spent wisely.

Moreover, in this time and space, the Soviet Union fought an extra war to recover Ukraine and other regions, which shows that the financial situation of the Soviet Union was much stronger than that of the Imperial Russian government.

In fact, Imperial Russia was very rich, but the money had no place to go. Otherwise, the Imperial Russian army would not have had difficulty in supplying weapons and ammunition during World War I. As for why the wealth was not put to good use, it was naturally the result of the manipulation of Imperial Russian officials, nobles, and capitalists. The money was distributed, but the weapons were not produced at all.

Not to mention that the Soviet Union was also facing blockade and economic sanctions from the international community.

Therefore, before 1929, it seemed that the total economic volume of the Soviet Union and the Russian Empire had not changed much, but if we look deeper into the difference between the two, we can say that there is a world of difference. With the same economic volume, the Soviet Union could almost play a % role, or even higher, while the Russian Empire could not even do %. In general, the economy of the Russian Empire looked prosperous, but it was very inflated.

Take education for example. The Soviet Union implemented universal literacy and compulsory education. By 1928, the Soviet Union's national literacy rate had exceeded %, and the urban residents' literacy rate exceeded %. The number of students in technical schools reached , and a large number of engineers, technicians and agronomists were trained. At the same time, the proportion of female college students in the Soviet Union increased to nearly %, which was a great achievement that was difficult to achieve in the imperial era.

Moreover, compulsory education is very expensive, which the East African governments are well aware of. At one time, the East African governments' investment in education even accounted for the first place in the national finances, exceeding military spending and other expenditures.

Not to mention, the Soviet Union also had to take into account construction and capital investment in other areas, such as post-war infrastructure reconstruction, factory resumption of work, urban construction, etc.

The construction in these areas also laid the foundation for the Soviet Union's first five-year plan. Apart from anything else, if you want to carry out industrial plans, you must have a large number of qualified workers and technicians. Without the Soviet Union's strong investment and construction in education, even if you put technology and machines in front of them, there will be no results.

Therefore, the smooth implementation of the Soviet Union’s first industrial plan was itself the result of the Soviet Union’s own efforts. They had laid a solid foundation for the implementation of the industrial plan.

This foundation has little to do with Imperial Russia. Although the industry of Imperial Russia was not weak in the world, it was impossible for a country with a large number of illiterate people to carry out a large-scale national industrial plan like the Soviet Union.

This can also be confirmed by the development of East Africa. The East African regime appeared as early as the mid-to-late 19th century, but why did it not start to implement the industrial plan until the early 20th century? To a large extent, it was because the education in East Africa had not yet exploded, and there was a lack of talent and workers, resulting in the lack of conditions for large-scale industrialization.

Congressman Rawlsson said: "This year, the economic crisis in Europe and the United States will only become more serious because capital is blind and there is a lack of strong constraints on them. Now, this economic crisis originating from Europe and the United States may even drag the whole world into the water. This is something we don't want to see. After all, East Africa itself is an important part of the world market."

"To avoid this situation, I suggest restoring a fully planned economy and restoring the economic system before 1910."

This proposition of the East African Labour Party will undoubtedly cause uproar in the conference and was criticized by most people.

"A piece of nonsense..."

"The Labour Party is really no good! They shouldn't have been allowed in..."

"The economic crisis is only temporary and cannot violate the laws of economic development..." However, not everyone opposes this. After all, there were beneficiaries of the planned economy era in East Africa. Coupled with the two five-year plans, it was indeed a period of rapid development in East Africa. When combined with the current development of the Soviet Union, there are some people who publicly expressed their support for the East African Labour Party.

Representative Andrew, a representative of the East African literary community, said publicly: "I think the proposal of Representative Rawlsson is very good. After all, before 1910, the Empire's economy developed very rapidly. In contrast, in the s, the Empire's economy was somewhat sluggish, especially compared with European and American countries. But in the s, our economic system was the same as that of European and American countries. It was precisely because we believed too much in European and American economics that our economy was sluggish in the s. Now, serious economic crises have broken out in European and American countries, which fully illustrates the drawbacks of the free market economy."

"Moreover, the free market economy has widened the gap between the rich and the poor, with capital wantonly exploiting workers for huge profits and social chaos occurring frequently..."

There are also supporters of planned economy in East Africa, and these supporters are not the Labour Party. Of course, the East African Labour Party is not a real Labour Party either. However, most East Africans are not aware of this. They think that the East African Labour Party is the same as the Labour Parties in Europe and the United States. In fact, the East African Labour Party is now just a puppet party.

In short, Rawlson's remarks triggered a great debate and even a quarrel in the East African Congress. Both sides held their own opinions, but overall, the majority of people opposed the East African Labour Party.

At this time, Ernst spoke to stabilize the situation and said, "Okay, stop arguing. Look at what you are like now. It's not like you are thinking about national affairs at all. You are just a bunch of shrews cursing in the market, chattering about trivial matters. It's embarrassing."

After the East African Labour Party’s speech, Ernst began to say: “Now is not the time to discuss who is right or wrong, but how to free the imperial economy from the impact of the world economic crisis.”

"First, we need to summarize the implementation of the Empire's economic policies in recent years and the problems we have encountered. There is no doubt that although the Empire's economic development has been somewhat unsatisfactory in the past decade, our progress is still above average in the world."

"The empire's population has increased to 200 million, and the urbanization rate has risen to about 45%. At the same time, the steel, chemical, electricity, machinery manufacturing and other industries have further developed, and it has firmly established itself as the world's largest industrial country. However, as Councillor Rawlson said before, the empire is also facing crises despite its economic prosperity."

"Especially now that an economic crisis has spread across most of the world, it is difficult for the Empire, as an important participant in the world market, to remain immune. If it cannot be properly handled, it is very likely to repeat the mistakes of European and American countries."

"As for the Soviet Union, its economic performance in recent years is indeed impressive, so we should not completely deny it. At least some of the Soviet Union's economic policies just show that they are desirable at the current stage. The empire also had a special economic stage. At that time, it was indeed the fastest time for the empire's economy to develop."

"Therefore, in response to this round of global economic crisis, we must be flexible. First of all, we must maintain the normal operation of the empire's economy to avoid large-scale unemployment."

“Continue to optimize and stabilize the financial system, rectify the financial industry, crack down on speculative activities, prevent the imperial financial market from over-expansion and eventual collapse like in Europe and the United States, boost and stabilize the people’s confidence and expectations in the economy, improve the deposit insurance system, and prevent panic runs.”

"Provide temporary relief to the unemployed and solve the unemployment problem as much as possible, such as expanding the military. Expand government spending and boost economic development in the short term through fiscal stimulus, including the construction of a series of large-scale projects."

"Work-for-relief, while further strengthening the empire's infrastructure construction and updating it for the long-term development of the empire, such as building highways, promoting the construction of large-scale water conservancy projects, improving the artificial canal network, building airports, renovating ports, and large-scale environmental ecological restoration and protection projects, etc."

"In short, one of the important purposes of the Seventh Five-Year Plan is to ensure the further orderly development of the empire's economy while responding to the economic crisis. Everyone should stick to this central purpose and provide practical suggestions instead of endless quarrels."

As Ernst finished his words, the farce in Congress came to an end, which also meant that the general direction of East Africa's economic policy was determined.

It is certainly impossible for East Africa to return to its economic system before 1910, but the role of state administrative intervention is emphasized. Next, the East African government will participate more deeply and strictly in national economic development.

This is a result that both sides can accept. Compared with the previous proposition of the East African Labour Party, the latter is obviously much more "friendly".

After the meeting.

In 1930, the preparation of the Seventh Five-Year Plan for East Africa was much faster, and the East African Planning Commission, an organization whose presence had greatly weakened in the past decade, once again entered the center of national power, especially in terms of economic policy, and its voice was almost close to that before 1910.

After 1910, with the adjustment of East African policies and the transition to a free market economy, the power of the Planning Commission was greatly weakened. In the past, this department directly controlled the economic development of East Africa, but later it became a guide. The meanings of control and guidance are completely different.

The former can mobilize all the resources and enterprises in East Africa, while the latter can play a leading role in the state-owned economy of East Africa.

Now, the authority of the Planning Commission has been strengthened again, which also marks a major change in the economic field of East Africa during the Seventh Five-Year Plan. Although it is still impossible for the Planning Commission to restore the status quo before 1910, it will also play a leading role.

In addition, Ernst will recruit members of the East African Labour Party to join the Planning Committee, which also means that the East African Labour Party will "dominate" the government's economic work in the future.

After years of optimization and downsizing, East Africa's state-owned enterprises will also play a leading role in the development of the empire's economy and maintaining smooth economic operation in the Seventh Five-Year Plan. The saying "raise troops for a thousand days and deploy them for a day" can be used to describe the East African government's next arrangements for state-owned enterprises.

Of course, there is another point that needs to be emphasized, which is the military expansion mentioned by Ernst before. Obviously, with the outbreak of the great economic crisis in 1929, the East African army will also usher in a new round of major development. This is not militarism. Since the end of World War I, the East African army has been operating at a relatively low standard, especially the East African Army. Except for some improvements in weapons and equipment, its scale has always been small. The navy has not developed much due to treaty restrictions. On the contrary, the Air Force has made obvious progress.

Now, with the outbreak of the economic crisis in Europe and the United States, conflicts in the international community will obviously also break out. In addition, East Africa's expansion in South America and other regions will also require more troops to protect East Africa's overseas interests and market security.

(End of this chapter)