Chapter 346

The year 1850 passed quietly in the midst of all the chaos. It seemed like an ordinary year, but the impact it brought to Austria was far-reaching.

A large amount of foreign capital poured into Austria, which led to the development of the domestic economy. All kinds of factories sprung up like mushrooms after the rain.

The most direct impact of economic growth was the increase in government revenue. Although many industries were given preferential treatment of tax reduction, the government also received a large amount of tax in the upstream and downstream links.

The industrial and commercial tax in 1850 increased by 8% compared to 1849, which was more than 4 million guilders. It didn't seem like a big number, but Franz was very satisfied.

This was just the beginning. When the tax exemption period ended, it would be the explosive period of tax growth.

The benefits of industrial and commercial development obviously wouldn't just be this little. The supporting industrial chain of the enterprise would also develop along with it.

This was reflected in the production of raw materials, product sales, transportation, catering, entertainment, and other industries, and could be seen in the financial sector.

In 1850, Austria's economy grew by 18.7%, and the government's tax revenue increased by 9.4%.

This wasn't a high number. Any country that opened its market would usher in rapid economic growth. There were examples of a sudden increase of 30% to 40%.

But compared to Europe at the same time, Austria's economic growth was considered to be the fastest.

There was no doubt that the dividends brought by economic growth were directly invested into the military and couldn't continue to be invested into reproduction.

Of course, Franz didn't dare to invest into reproduction. If it weren't for the limitations of communication and transportation in this era, Austria's hot economic growth would be even faster.

It didn't mean that rapid economic growth was necessarily a good thing. For a country, the most important thing was sustainable development. If the market didn't keep up with the short-term economic boom, then excess production capacity was inevitable.

Excess production capacity meant that a large number of goods couldn't be sold and would rot in the warehouse. Rich enterprises could still reduce production capacity and transform, but weak enterprises could only go bankrupt.

Enterprises went bankrupt, unemployment increased, and the market's purchasing power continued to decline. Capitalists had to continue to reduce production capacity and layoffs. A vicious cycle began, and the economic crisis broke out.

To some extent, this arms race also extended the period of rapid economic growth in Austria. The military itself was a consumer group, and the expansion of the military also expanded the consumer market.

Currently, the fastest development in Austria was the railway. Construction began in 1849, and now there were as many as hundreds of sections under construction.

The annual mileage of the railway increased by 265 kilometers. Don't get me wrong. The railway was built a few years ago and was completed in 1850.

The railway that was built in 1849 was still visible. This was different from the road. Roads could be built and paved with concrete, but railways were different. Unless a section of the road was completed, even if the tracks were laid, no one would dare to run trains, right?

However, by 1852, it was estimated that part of the road in the plains would be open to traffic. Whether or not it would be put into operation earlier, only the railway company itself would know.

The Austrian government would not ask about such a small issue. These private railway operators were responsible for their own profits and losses and had nothing to do with the government.

To encourage people to build the railway, the Government of Austria. Starting from the establishment of the railway project, the railway operation tax would not be levied for the next ten years.

If you wanted to make money, you had to build the road in advance. Delaying the construction period would be against your wallet.

Taking advantage of the railway's hot environment, the Government of Austria packaged a large number of railway lines to private railway companies. The demolition costs could be paid by the government. The prerequisite was that after obtaining the railway construction rights, construction must start within a year and must be open to traffic within ten years.

As far as Franz knew, so far, the Government of Austria had sold more than 40,000 kilometers of railway lines.

God knows how many unfinished projects would be left behind. Anyway, the government wouldn't lose money. Even if they took over the unfinished projects, it would be cheaper than building from the beginning, right?

The railway company was also aware of these problems, but the hot market could deceive people. Austria's economic growth also deceived many people.

Coupled with the financial groups adding fuel to the fire, it fueled the ambition of investors. Many speculators wanted to wait until the highest point to sell the stock and make a big profit.

If you wanted to raise the stock price, you naturally had to make a beautiful report. If a railway company only had a few hundred kilometers of railway in its hands, no matter how much you boasted, it wouldn't attract many people.

If there were thousands of kilometers or even tens of thousands of kilometers of railway, then there was no need to boast. Someone would give you a development blueprint.

Relying on the railway to make money was only one aspect. After controlling the railway network in certain areas, even if you invested in other industries, you could also use the transportation network in your hands to squeeze out competitors. A conceptual business empire would appear.

In the hottest era of Europe's railway industry, there might be four or five railways operated by different companies between two cities, directly competing in the market.

At least the Government of Austria didn't authorize the same section to different railway companies. This gave many people an opportunity.

Was there a more profitable business than a "monopoly" in the world? Even if the railway line was not of high economic value, once a market monopoly was formed, it would be a big profit!

Franz wouldn't admit that he was using people's mentality to trick the capitalists to invest in the railway. Monopolization is fine as it avoids the waste of resources caused by market competition. As long as it does not affect China's economy, Franz doesn't mind monopolizing the railways.

If the freight charges were too high and affect China's economy, then the people who set the rules can also change the rules. For example, the Bureau of Commodity Prices, state-owned railways … …

The Austrian government would never tell their investors about these discordant topics. Otherwise, how could the British consortium be tricked into coming here?

Franz doesn't mind doing what the Americans had done before. No matter what, I must trick you to fix the railways first. When the railways are no longer useful, I can consider falling out with you.

To Franz, in his previous life, Hong Kong's public infrastructure projects must not get more than 15% profits. This is a good policy.

If the Government of Austria were to copy this policy, the people would support it. As for the railway companies, 15% profits can also let them live comfortably.

When can the investors recover the construction costs? This is a problem that no one knows. Anyway, the investors at the front had made a profit, and the buyers at the back were always unlucky.

The development of the railway naturally stimulated the iron and steel industry. Many iron and steel enterprises expanded their production capacity, preparing to get a piece of the pie in the upcoming feast.

To effectively integrate resources and increase the competitiveness of the companies, in March 1850, the Austrian Ministry of Industry ordered to merge seven state-owned steel companies into the Austrian Steel Group.

Austria's first steel giant with an annual output of 12,000 tons of steel and 184,000 tons of iron was born. With some artistic modifications, the annual output was 200,000 tons, and the world's number one steel company was born.

Whether it is really the world's number one steel company is still unknown. But it is a fact that it is Austria's number one steel company. Half of the Austrian Empire's steel production is in this company.

In this era, there are only a few countries that produce more than 100,000 tons of steel. Only the British can produce more than 1 million tons of steel.

If it wasn't for the fact that everyone was stuck at this level, the Austrian media would not dare to boast about this. In general, the journalists of this era still have their principles.

After the merger, these steel plants began to divide the work. According to the geographical location of each place, they fully utilized their own resource advantages to integrate production.

Simply put, according to the quality of the iron ore, all the suitable ones will be used to make steel, and the suitable ones will be used to make iron. There is no need for a mixed production model.

The most important thing was to gather the core technologies of several companies together and use the advantages of each in industrial production. At the same time, a smelting technology R&D department was set up to promote technological innovation.

According to the plan, the Austrian Steel Group's production capacity will increase to 240,000 tons in 1851, 320,000 tons in 1852, and 450,000 tons in 1853 …

These plans are not random. They are completely based on the needs of the market. How can they compete for orders without expanding production capacity?

The construction of Austria's railway network is a big fat piece of meat, and all related companies want to take a bite.

According to the calculation of 60 kilograms of steel per meter of railway, one kilometer will consume 60,000 kilograms of steel. In other words, the Austrian railway network plan will consume more than 2 million tons of steel.

With such a good opportunity, if the steel companies don't expand production capacity, they will be stupid.

In order to support the steel companies, the Government of Austria has decided not to take profits from the newly formed group in the next five years. They also injected a million Dunn into the company for technological innovation.

Not only the steel companies, but many related industries are desperately expanding production capacity. Franz is also making a fortune quietly.

Don't look down on small things like sand and stones. In fact, people who have been involved in engineering know that the profits of these inconspicuous things are not low at all.

Preliminary estimates show that pouring concrete for each kilometer of railway will consume tens of thousands of tons of sand and stone aggregate. The thick layer of gravel on top will require an astronomical amount of stone.

The larger the volume of any commodity, the higher the profit. These inconspicuous things are in fact no less profitable than the steel plant producing the railway.

It is just that most of the time, they are scattered in the hands of countless individual investors, so they look inconspicuous. Franz only used his foresight to plan ahead and monopolize the operation.

Of course, he will not admit to monopolizing the operation. If you don't believe it, you can check the contracts between the railway company and the Austrian mining group to prove the existence of a monopoly.

However, the insiders will not say anything, and the media will not report it.

The explanation to the public is that the Austrian mining group is only an agent. These mines are distributed under the names of dozens of companies. In order to avoid vicious competition, they formed a group to negotiate with the railway company.

That's right, this is the truth. In order to avoid being pressured by the railway company, everyone joined forces. Didn't you see the final transaction price? It is almost the same as the market price.

If it is a monopoly, the price will definitely increase. Since there is no significant increase, then it is not a monopoly.

In 1850, Franz finally understood what it means to make money lying down. Just this inconspicuous small business has earned him an annual profit of 1.23 million Dunn.

This is just the beginning. With the advancement of the railway construction, he will be able to make money lying down for a long time in the future.

Unfortunately, after the railway construction is completed, there will be no market for the sand and stone mines in the wild. If he wants to make a big profit, he can only wait for the construction of the road network. Looking at the current situation, there is no hope for the next 30 to 40 years.