THE EGYPTIAN CRISIS.

In order to understand the true significance of the crisis which has recently occurred in Egypt, it is necessary to realise the conditions by which the crisis was preceded, and under which it took place. Having resided at Cairo, with brief intervals, throughout the period embraced between the final formation of the new Ministry by Mr. Rivers Wilson's arrival in Egypt, and its disruption by the dismissal of Nubar Pasha, and having from personal relations been in a position to know more than ordinary residents of what was going on in the world of Egyptian politics, I can perhaps throw some light on a chapter of Anglo-Oriental history which is worth studying, not only from its intrinsic importance, but from its bearing on a number of similar issues, of far greater gravity, with which England, at no distant period, must be called to deal. I see that in many quarters the crisis is regarded as a proof of the arbitrary and unaccountable caprice which is the characteristic of Eastern despotisms. The assumption is plausible, but erroneous. If my view is correct, the abrupt dismissal of the Prime Minister of the Egyptian Cabinet was a deliberate act, pursued in accordance with a settled policy; a long foreseen move in the game which is being played out between the European Powers on the one hand and the Khedive on the other. How this came to pass it is my object, if possible, to explain.

I am not going to repeat once more the weary tale of the causes which have brought Egypt into her present embarrassments. I intend to assume that the general history of England's relations with Egypt during the last five years is, in the main, familiar to my readers. It is enough for my purpose to say that with the appointment of the Commission of Inquiry in the spring of 1878, England finally abandoned the attitude of non-intervention in the affairs of Egypt to which she had adhered so pertinaciously, and, as I have long held, so ill-advisedly. It is true that this Commission was in theory established at the instance, and in the name, of the Khedive. But, as a matter of fact, it was forced upon his Highness, sorely against his will, by the direct pressure of the French and English Governments, and was only accepted by him in virtue of a belief, whether well or ill founded, that the security of his throne

would be endangered by continued resistance to their demands. From the date, therefore, when the Commission was appointed, the era of direct European, or, more strictly speaking, Anglo-French, intervention may be said to have commenced. The Commission eventuated in the establishment of the existing Egyptian régime. The true character of this régime, difficult as it is of explanation in any case, is utterly unintelligible unless we bear in mind the origin of the anomalous investigation to which it owes its existence. At the close of 1876, the Khedive, being then apparently on the verge of bankruptcy, concluded an arrangement with his European creditors, as represented by Mr. Goschen and M. Joubert, in accordance with which he consolidated his debts, and pledged himself to pay an annual sum as interest and sinking fund, which, for present purposes, may be stated as being in round numbers seven per cent. upon a capital of a hundred millions. Before, however, twelve months had elapsed, the Khedive alleged that the above arrangement had been concluded on the faith of erroneous, if not fraudulent, returns; that the country was utterly unable to meet the drain upon its resources caused by the payment of the interest on its debt, and that this debt must be reduced if Egypt was not to be ruined by the burden of taxation. His Highness further proposed that a fresh Commission should be appointed to investigate the resources of Egypt. In itself the request was not, primâ facie, an unreasonable one: and it would, under the circumstances of the case, have been acceded to without serious objection, if any confidence had been, or could have been, reposed in the good faith of its author. But after the endless conflicting representations which had been made at various times, on the authority of the Khedive himself, as to the resources and liabilities of Egypt, no such confidence was forthcoming. At the time the proposal for a reduction of the debt interest was thus mooted by his Highness, Nubar Pasha was residing in Paris in exile, and was in close communication with parties by whom Egyptian securities were largely held in France. If I am not mistaken, the ex-Minister was the first to advise that no demand for a reduction of interest should be entertained, till steps had been taken to ascertain, independently, not only what the Khedive really owed, and what he could pay, but how his embarrassments had been brought about. Great distrust of the Egyptian Government (or, more truly speaking, of the Khedive, for up to this time the Khedive and the Egyptian Government were identical) had long been entertained by its European creditors. This distrust assumed a more distinct form after the publication, in these pages, of an article professing to give an explanation of the true causes which had led to the financial difficulties of Egypt under the personal administration of Ismail Pasha. The importance of this article-as a link in the chain of events I am endeavouring to explain-lay not so much in the attention it excited as in the fact that it was underVOL. V.-No. 26. X X

stood, and rightly so, to express the views of Nubar Pasha, that is of the man who, next to the Khedive himself, was best qualified to know the truth as to the relations between Egypt and the Viceroy. The gist, I may add, of the article in question was to show that the Khedive had, during the thirteen years of his reign, possessed himself of one-fifth of the whole cultivated soil of Egypt; that he had established a gigantic monopoly, supported by measures absolutely fatal to the industrial development of the country; and that no settlement of the financial difficulties of Egypt could be of any permanent value which failed to overthrow this monopoly, and to destroy the iniquitous system by which it was maintained.

In accordance with, if not in consequence of, these disclosures, a demand was raised to the effect that the inquiry proposed by the Khedive must extend its investigations to the causes which had brought about the embarrassments of Egypt, and should not confine its labours, as the Khedive proposed, to ascertaining the actual capabilities of Egyptian revenue. This demand was vigorously supported by the French Government, at the instance of the Crédit Foncier and of other French financial associations which were interested in Egyptian securities. Our own Government hesitated at first about endorsing a proposal hardly consistent with the traditional principle of our State policy, that the interests of individual creditors who have lent money to foreign countries are not matters of public concern. In the end, however, a well-grounded reluctance to allow France to interfere single-handed in the affairs of Egypt, and a perhaps exaggerated estimate of the importance of co-operation with France on the eve of the Congress then expected to assemble at Baden-Baden, induced our Ministry to forego their original objections. In consequence, France and England together compelled the Khedive to -submit to an inquiry, notwithstanding his protest that an investigation of this kind, if conducted in the manner proposed, was a direct infraction of his sovereign authority. The Commission having been appointed, the Khedive suggested that the intended presidency should devolve upon the Egyptian Commissioner. This suggestion was rejected on the avowed ground that a native nominee of the Khedive would be disposed to stifle disclosures which might be inconvenient to his royal master; and the Khedive, again under pressure, was forced to allow the duty of directing the inquiry to devolve upon Mr. Rivers Wilson, in the absence of the President, M. de Lesseps. The importance of this incident is that it illustrates the true character of the inquiry, which was in fact, though not in name, a Court appointed to place the Viceroy upon his trial.

Theory, however, and facts did not correspond together. Nominally the Commission of Inquiry was an investigation undertaken at the wish and by the authority of the Khedive, to provide certain information for the benefit of his creditors. Its raison d'être was to ascertain how

far Egypt could continue to pay the present rate of interest on her debt; and if not, what amount she could reasonably afford to contribute. The inquiry into the system under which this debt had been incurred was only of a subsidiary character. This distinction between the two branches of the inquiry must not be lost sight of, as it forms the key to the whole existing situation. The Commission met in the March of last year, and forthwith set to work to ascertain the causes which had led to the sudden and gigantic indebtedness of Egypt during the present reign. It was found that the disclosures contained in the article to which reference has been made, were substantially, if not literally, correct. It was elicited, on indisputable evidence, that since 1864 the Khedive had, under his own name or that of his family, become the owner of one million of acres out of the five millions that constitute the land under cultivation in Egypt; that this colossal estate had been farmed by forced labour exacted in the most oppressive and ruinous manner; that the interests of the population had been wilfully and deliberately sacrificed to the individual advantage of the Khedive, as the owner of a gigantic monopoly obtained in the main by aid of the loans he had contracted abroad; and that this monopoly had been so miserably administered as to result in a loss not only to the country at large, but to the Khedive himself.

At a very early stage of the inquiry it became manifest that the Commission would report the charges brought against the Khedive to be substantially proved. Before, however, the Commission was in a position to make any definite report, an incident occurred which has a remarkable bearing upon subsequent events. The half-yearly coupon on the Unified Debt, which is the Egyptian stock chiefly held in France, falls due in May. During the early months of the year the receipts of the treasury had been suspiciously small, and, shortly before the date when the coupon became due, the Khedive announced that it would be impossible to pay the interest in full. The effect, of any default made at such a time would have been to cause a heavy depreciation in the Unified Stock, and would therefore have been greatly detrimental to the interests of the Crédit Foncier, who had some 6,000,000l. locked up in this security. For reasons into which I need not enter, the Government of the French Republic espoused the interests of the Crédit Foncier as being matters of national concern, and intimated to the Khedive that the interest on the Unified Debt must be provided for. I am not concerned now with the equity of this action, though I admit there was more to be said in its favour than might be thought at first sight; I am simply narrating what occurred. If I am rightly informed, the Khedive was given to understand that persistence in his alleged inability to provide the coupon would lead to decisive steps on the part of France, though I am by no means sure that the exact nature of these steps was explicitly indicated. Upon this, his Highness asked for advice

from England as to the course he should pursue. Our Consul-General at Cairo was, I believe, personally of opinion that the payment of the coupon ought not to be insisted upon in the interest of Egypt. But his opinion was overruled from home. The Congress was at last about to meet at Berlin. For the success of our policy the support of France was deemed all important; and in order to secure this support it was thought essential to avoid any conflict with the action of the French Foreign Office in Egypt. Such, at least, is the only plausible explanation of the attitude adopted by our Government on the coupon question. Our consul at Cairo was instructed to impress upon his Highness the importance of making no default in his payments while the Commission of Inquiry was conducting its investigations. Upon finding that France and England were together, the Khedive, as usual, gave way at once. was accomplished. Whether the funds required to deficiency were provided by putting the screw once more upon the long-suffering fellahs, or by a loan contracted under the form of a fictitious sale of produce, or by advances from the private hoards of the Viceroy, has never yet been clearly ascertained. All that can be said is, that somehow or other the funds were found, and the coupon paid.

prepared to act

The impossible make good the

The result of this enforced payment of the May coupon, however objectionable on other grounds, was to impress the Khedive with a conviction that the era of non-intervention was at an end, and that he could only hope to retain his throne by very large concessions. After sitting for four months, the Commission found themselves justified in coming to the conclusion, that no real reform could be effected in the finances of Egypt so long as the Khedive remained in possession of the vast estates which he had acquired. It was therefore intimated to his Highness that he must surrender his private estates to the public treasury. No demand could have been more unwelcome; and for some time it was met with a point-blank refusal. As soon, however, as the Khedive saw reason to believe that unless he gave way the Commissioners would return home, and would report to their respective Governments that their mission had been rendered nugatory by his action, he yielded the point at issue. His submission was doubtless accelerated by the fact that his uncle Halim Pasha, residing in exile at Constantinople, had put himself forward as a candidate for the throne, and that his son and heir, Prince Teufik, had anticipated his decision by offering to give up the estates settled on the heir apparent. But, though these ominous incidents shook the Khedive in his determination, it was only when direct pressure was applied from abroad that he agreed to surrender the monster estates he had accumulated with such patience and at such a cost. The surrender was doubtless made with the hope that it might be cancelled hereafter. But, be this as it may, the Daira lands,