Persian Empire 1845

Chapter 493 Private Meeting in Berlin (Part 2)

"I wonder how much Your Excellency the Prime Minister knows about Spain and Sicily?"

"These two places..." Bismarck thought, one was Habsburg territory, and the other was Bourbon territory. Only Sicily's economy had improved in recent years; as for Spain, it remained as chaotic as ever.

Queen Isabella II of Spain ruled through 30 governments, promulgated seven constitutions, and launched 15 uprisings, with a succession of sycophantic officials coming to power. Her particular favoritism towards reactionary elements in the military and church further alienated her from the Spanish people. She narrowly escaped assassination twice.

Under such circumstances, Spain's economy naturally fluctuated. Although railways were developed rapidly, Spain is essentially an agricultural country, exporting mainly agricultural products and minerals. Nasser al-Din saw investment opportunities in the region; if there had been a change of government, things would likely have been much better.

"What, is your country interested in these two countries?"

"I wouldn't say I'm interested, but there are large tracts of land in the area that haven't been developed yet. Shah thinks it's a bit of a shame."

“The Shah’s interest in the Iberian Peninsula is interesting.” He slowly exhaled a smoke ring. “But did you know that last year, the interest rate on Madrid’s government bonds soared to 17%? Even Rothschild Bank refused to continue lending.”

Unfortunately, Spain's debt had reached 38 billion pesetas (1.9 million pounds). Interest payments alone accounted for 40% of its revenue. Meanwhile, most of its Latin American colonies had gained independence decades ago, leaving only Cuba, the Philippines, and Puerto Rico, which relied on sugar and tobacco exports. Furthermore, various labor and peasant movements existed, and Nasser al-Din saw an opportunity there. Just as he had controlled Austria economically, perhaps he could control Spain as well.

Bismarck also realized that as long as Iran made money, that was fine. As for the wars on the European continent, he basically remained neutral.

"As the saying goes, risk and reward go hand in hand. Who knows how much profit these things will bring in the future? I think you agree, don't you?"

Bismarck nodded. If you only want low-risk options, then don't go into finance or politics. Those are the riskiest industries, but also the most lucrative.

"I believe your country will make a lot of money in Spain."

"Thank you for your kind words!"

Bismarck felt no pressure about this; after all, it was another country, and as long as it didn't affect his own interests, it was fine. As for investment, that was Iran's business.

Having confirmed that the Iranian government had no intention of supporting France, Bismarck felt relieved. He assumed the businessmen were acting privately, and if they uncovered anything, relations between the two countries would likely deteriorate rapidly. His diplomatic policies following the Austro-Prussian War could be considered a successful conclusion, the most important of which was the Luxembourg crisis. After the Austro-Prussian War, France was quite afraid of Prussia, and upon learning of Austria's defeat by Prussia, Paris was filled with lamentation. French War Minister Randon remarked to those around him, "We, France, have also suffered a defeat in Sadowa."

The seasoned politician Thiers lamented: "The defeat of Austria means the greatest disaster France has suffered in 400 years, and it has lost a trump card to prevent unification!" Thiers' words revealed France's mistake in the Austro-Prussian War, and from then on, France had to take matters into its own hands to prevent the unification of Prussia.

Just six months after Prussia defeated Austria, the French Prime Minister publicly stated that it would be beneficial for France to divide Germany into three parts. Napoleon III went even further, saying, "Only if Bismarck respects the status quo can I guarantee peace. If he brings the southern German states into the North German Confederation, our cannons will fire automatically."

Bismarck understood that German unification would inevitably lead to war with France, and his task was to provoke a war, with Luxembourg as the breakthrough point.

Even before the Austro-Prussian War, Bismarck had verbally promised France that it could annex Luxembourg. At the time, Napoleon III believed that Prussia would be severely weakened in the Austro-Prussian War and dreamed of extracting more benefits from Prussia. Therefore, he did not require Prussia to sign a treaty to make a written commitment to this matter.

To his utter surprise, the Austro-Prussian War ended so quickly that Prussia not only was not weakened but became even stronger. Napoleon III then demanded that Bismarck honor his promise, suggesting that France and Prussia form an alliance to support his annexation of Luxembourg, and requesting that Prussia provide military assistance should France decide to annex Luxembourg by force.

But Bismarck no longer needed France at this point, and was even plotting a decisive battle with France, so how could he agree to this request?

Unable to secure Prussian support, Napoleon III resorted to threatening the Netherlands with force, demanding that they sell Luxembourg to France. The Dutch king reluctantly agreed, but insisted on informing Berlin, hoping to leverage Prussia's power to counter France. Bismarck immediately saw this as a golden opportunity to diplomatically isolate France and promptly leaked the information. Upon learning that France was about to forcibly annex Luxembourg, German nationalism was ignited, and public opinion strongly opposed France's shameless act.

As Bismarck had predicted, the leak of news that Napoleon III intended to forcibly annex Luxembourg provoked strong resentment in Britain. The security of the British mainland relied entirely on the relatively narrow English Channel, making Britain extremely sensitive to any territorial changes across the Channel. Belgium, in particular, was a stronghold, with its renowned port of Antwerp only 300 kilometers from London. Luxembourg served as a buffer for Belgium, and Napoleon III's annexation of Luxembourg was, in effect, aimed at Belgium.

Subsequently, an international conference on the Luxembourg crisis was held in London at the initiative of Britain. Participants included Prussia, France, Britain, Russia, Austria, Italy, and the Netherlands. Neither Prussia nor France had the upper hand, so the conference ultimately made arrangements most favorable to Britain: Luxembourg became a neutral country, and all participating countries jointly guaranteed its independence and security.

Napoleon III suffered a complete defeat at this conference. The deal that had been agreed upon was ruined by Bismarck, and he was forced to recognize Luxembourg's neutrality, thus offending Britain as well. He lost both his wife and his army.

After the Luxembourg Crisis, Napoleon III truly realized that Prussia had not only grown too powerful for him to control, but had also become France's most dangerous adversary. In preparation for the future Franco-Prussian War, Napoleon III began actively pursuing diplomatic alliances. However, as mentioned earlier, Napoleon had offended almost every nation, and no one would help him as emperor; France was utterly isolated.

(End of this chapter)