Chapter 424

With the end of the economic conference, the power industry was listed as Austria's new pillar industry for the next ten years, accompanied by heavy industry.

Today, the scale of Austria's heavy industry was also an astronomical figure. The main industries involved were: steel, metallurgy, coal, machinery, chemical industry …

In terms of classification, power could also be considered a type of heavy industry, and the two were very closely related. However, because it had just started and the scale of its industry was very large, it was listed separately.

The number of pillar industries couldn't be many. Since power and heavy industry became the new pillar industries, naturally, there were industries that fell from the "pillar industries."

There was no doubt that the "railway" was replaced. It wasn't that the railway wasn't important, but after more than twenty years of hard work, most of the railways in Austria had been built.

The railway industry was beginning to reach saturation. In this state, what was needed was steady development, and the government didn't need to invest too many resources.

In addition to the railway, the development of agriculture had actually reached its limit. The growth rate of the local agriculture had already slowed down. The agricultural market was only so big, and the more food they planted, the more they earned.

The current growth rate of agriculture was similar to the growth rate of the population. Austria already occupied 70% of the international agricultural export market, and this share was almost impossible to increase further.

It wouldn't be long before Russia's agricultural products would make a comeback, and it would be very difficult to maintain the current market share.

In order to ensure the healthy development of agriculture, Austria's agriculture had been adjusted many times, from the initial direct export of agricultural products to the later export of refined agricultural products.

During this period, it also included the promotion of raw silk cultivation in Lombardy and Venetia, and the promotion of grape cultivation in the The Balkans, and the development of the wine industry.

These practices were all artificially reducing food production to ensure food prices. With the outbreak of the Prussian war, the international market lost the Russian competitor, and the recent years had been better.

However, these good days were coming to an end. The Tsarist government was negotiating with various countries, preparing to use food to offset the previous debts.

This was a forced sale. If the creditors didn't accept, then these debts would never be repaid. Without thinking, Franz also knew that Alexander II Of Russia's plan would succeed.

The Hairy Bear's debt wasn't easy to collect. Even with a discount, it was better to be able to recover part of it than to lose everything. Even if the governments of various countries had objections, the capital would make everyone compromise.

The dispute now was nothing more than a matter of interests, and it could be settled sooner or later. The diplomatic obstacles that prevented Russia's food from entering the international market had now been cleared by Alexander II Of Russia.

The market was only so big. If you sold more, others would naturally sell less. Although there were many places that lacked food in this era, only Russia had the purchasing power.

If it weren't for the Russian Empire's transportation system, which directly hindered their food exports, the international food prices would have collapsed immediately.

Franz had never doubted the Russians' ability to produce food. Alexander II, in particular, overturned the table when he opened up the wastelands.

In recent years, Alexander II had suffered more than 20 assassination attempts, which proved how hateful his reforms were.

Even the stupidest of nobles reacted to the situation. Unfortunately, the general trend was already set and the land had already been reclaimed. It was already too late to retreat.

Franz had no interest in the Tsarist government's internal strife. He wasn't optimistic about Alexander II Of Russia using food to pay off the debt.

No matter how good the policy was, it depended on the implementation. The food in the country didn't belong to Tsar. If they wanted to pay off the debt, they had to collect the food and transport it out.

Putting aside the financial pressure, someone had to carry out the purchase of food, right? Who could guarantee that the bureaucrats wouldn't be tempted in the face of interests?

During the land reclamation, Alexander II Of Russia kept a close eye on the farmers. Some people even docked the farmers' rations. It even caused riots more than once.

If they collected food in the form of taxes, there would be an overcharge of three to five buckets. Or something similar to "fire consumption" would appear, and it would be legally washed away.

If they used money to buy food from the people, the bureaucrats would do the same. They would buy the food from the farmers at a low price and sell it to the capitalists for profit. In the end, they would just leave some for Tsar to complete their mission.

Unless the Tsarist government set a high price, higher than the market price, and the bureaucrats could benefit from it, they wouldn't be able to collect much food.

The Tsarist government's plan couldn't be realized, but the impact of Russia's food would not be small. As long as there was profit to be made, the capitalists would still transport the food to sell.

Franz suspected that Alexander II Of Russia did it on purpose. First, they used the excuse of using food to pay off the debt to trick other countries into opening their markets.

Every year, the Tsarist government would symbolically give some food to pay off the debt, and then let the capitalists transport the food to sell.

Although it seemed like the Tsarist government didn't gain anything by doing this, in fact, as long as they sold the unmarketable food in the country, they would make a lot of money.

Even if other countries knew about the Russia's plan, they would most likely go along with it. For the food importing countries, being able to buy cheap food was always a good thing.

The real loss of interest was only the current food exporting countries, and Austria was the biggest victim. Before the political confrontation, Russia and Austria were the first to go against each other economically.

Now, there wasn't much room for Austria to choose. They could either use the advantages of transportation and agricultural technology to directly drive down the food price, making it unprofitable for the Russians to export food.

But doing this would be killing eight hundred and losing one thousand of their own. It should be known that Austria was the overlord of the international agricultural export market, and they could gain a lot of profits every year.

Even if they won the price war and occupied a larger market, it would still lead to a decrease in profits because of the decline in food prices. In the end, not only would they not be able to gain more profits, but they would also have to pay a big price.

The Russians were just barefoot challengers. If they failed, it would be the same as before. If they succeeded, they could gain a lot of benefits.

In the original Time and Space, the Americans played the price war, defeated all competitors, and established the hegemony of food exports. That was to achieve a strategic goal.

Now, Austria couldn't follow suit. Not to mention that it would cost a lot of money, the key was that it was the era of colonial empires. Britain and France had a large number of colonies.

If the local food was insufficient, they could make up for it from the colonies. Relying on the control of international food exports wouldn't scare them at all.

Otherwise, Franz would have long played with the food export alliance, roped in several food-exporting countries, and manipulated the international food market to obtain greater benefits.

Unable to achieve the strategic goal, and facing the challenges of many competitors, it could be said that after the basic accumulation of capital, the importance of agriculture had decreased.

The decline in importance didn't mean that it could be abandoned. In fact, agriculture was still one of Austria's most important industries. The industrial chain formed around agricultural production accounted for 38.6% of Austria's GNP.

Although this proportion was decreasing year by year, it still didn't diminish its importance. In the face of the challenge from the Russians, industrial restructuring was imperative.

Austria's agricultural industrial system had been perfected. From the most basic agricultural production to the terminal agricultural sales, the product added value was almost played to the limit.

For example: from wheat to flour and biscuits, from fruits and vegetables to canned food, from grapes to wine and raisins, from potatoes to chips …

In this era, it was all ecological agriculture. There were no fertilizers, pesticide additives, and there was no such thing as green food. The people were too poor, and there wasn't much market for branded agriculture.

A complete industrial chain increased the ability to resist risks, and when it was impacted, the impact on the economy would be greater.

The technical content of these industries was very low. European countries weren't completely without agriculture. They also had these industries, but they were limited by raw materials.

Once a large number of cheap raw materials appeared, the capitalists certainly wouldn't mind expanding production. Austria was even the largest buyer of Russia's food. In the face of profit, the capitalists' integrity had always been low.

The low tariff system of Russia and Austria created opportunities for Austria's industrial and commercial exports, but it also brought challenges.

In the face of cheap foreign food, these agricultural processing enterprises would definitely make choices that were in line with their own interests. In this regard, the government couldn't force them. After all, enterprises also had to survive.

Today, the profits of agricultural processing enterprises had also decreased significantly, from the initial 30-40% to the current 10%.

This was still the gross profit, and the net profit would be even lower. Under the cruel market competition, agricultural processing enterprises had entered the era of small profits, and they relied on volume to make money.

The ones with relatively high profits were all snack processing enterprises. However, the competition of these enterprises was even more brutal. Almost all the snack market had dozens or even hundreds of similar products.

The single unit profit was good, but the problem was that the sales volume wasn't large. There weren't many enterprises that could make a brand and earn huge profits.

Now Austria's agricultural industry technology had risen to the top of the era, and it had become the existence of the arena.

Fortunately, Russia's agricultural products were relatively simple. It was nothing more than potatoes, wheat, corn, fruits, and vegetables. Unless processed into canned food, they would rot before they were shipped out.

Obviously, Russia's industry hadn't caught up yet. The development of these industries wasn't good, and the products produced couldn't even be sold in the local market, let alone the international market.

At this point, it was imperative for Austria to adjust the agricultural industry. For example, reducing the output of agricultural products that would obviously be affected, and changing to other cash crops that were in short supply in the market.

It was easy to say, but difficult to do. There were so many farmers in Austria, and it wasn't a simple matter to change their planting habits.

Because market information wasn't transparent, even Franz couldn't accurately judge what agricultural products the market would lack in the future.

They didn't know what the market lacked, which made the government's guidance of agricultural products become empty words.

Unless it was a planned economy, otherwise, for a long time in the future, there would be chaos in agricultural products.

This was an unsolvable problem. The agricultural products that were in short supply this year might rot in the fields next year, and no one would care about it.

The farmers were also adjusting the direction of agricultural products based on their own judgment. There were too many people involved, and it was impossible to coordinate.

Franz had a headache.