Regarding the governnt’s developnt report, what Carlo was actually more interested in was the Spanish Governnt’s fiscal report.
After all, whether it was carrying out reforms or construction, it all required large amounts of pesetas. If the governnt’s funds situation was not monitored, perhaps the country would go bankrupt without anyone knowing.
Regarding the governnt’s fiscal situation, Pri Minister Primó actually had a lot to say as well.
“Your Majesty, according to the Ministry of Finance’s summary of the 1870 total fiscal report, our economic situation is relatively good, and it is expected to maintain fairly stable growth in ” Pri Minister Primó smiled as he spoke, appearing sowhat more relaxed when ntioning Spain’s economic situation.
Economic developnt is always interconnected. Although it seed the governnt had reduced taxes on farrs, once the farrs had money, whether they deposited it in banks or spent it on consumption, it would similarly stimulate Spain’s fiscal growth.
In addition, with Spain’s various construction projects, many jobs above the per capita inco level had erged, which were welcod by many Spaniards.
The most popular currently were the workers at the steel mills. Although working at steel mills was tough, the money earned was real.
Not to ntion anything else, just the steel mill that Carlo had integrated after recruitnt in 1870 alone hired over 400 workers in one year, and across all of Spain, there would only be more.
The public was getting richer, and their consumption levels would naturally rise steadily. The public’s consumption could also stimulate developnt in all industries, and Spain’s economy would naturally rise accordingly.
If Spain during Queen Isabella’s rule was more like a stagnant pool of murky water, then current Spain was more like living water connected to rivers, because the various construction projects advocated by the governnt and the Royal Family were gradually revitalizing the entire economic system.
Carlo nodded, appearing to listen attentively.
Just the Royal Family had earned quite a lot of funds during this period, so the governnt’s fiscal revenue should have seen considerable growth as well. After all, the Royal Family had beco one of the governnt’s major taxpayers so far, paying over a million pesetas in taxes to the governnt in
“According to incomplete statistics, our Gross National Product in 1870 was approximately 1828 billion pesetas, an increase of about 5% compared to
Fiscal revenue was approximately 48 million pesetas, accounting for about 7% of the Gross National Product. Our fiscal expenditure reached 8 million pesetas, with a fiscal deficit as high as 60 million pesetas.
However, because we issued national debt and obtained war indemnity from Morocco, we could barely cover our fiscal deficit.” Pri Minister Primó handed Carlo a detailed report on Spain’s finances and explained.
Understanding national developnt is also a right befitting a king, and Primó naturally would not refuse Carlo’s understanding of the national situation, as a king indifferent to state affairs was not a good thing either.
“60 million pesetas fiscal deficit?” Carlo felt a bit of a headache. Originally, hearing that Spain’s total fiscal revenue reached 48 million pesetas had put Carlo in a pretty good mood.
But after hearing that the fiscal deficit alone in 1870 was as high as 60 million pesetas, Carlo’s mood was not so great anymore.
60 million pesetas! Converted to pound sterling, that was nearly 3 million, which was absolutely a huge sum.
“Where did this 60 million pesetas go?” Carlo hurriedly asked.
No joke, the Royal Family’s total assets so far had not exceeded 60 million pesetas. Even the Royal United Bank’s total savings funds barely reached that figure.
The Spanish Governnt’s annual fiscal loss was as high as 60 million pesetas, which ant that just one year of governnt losses equaled the total property of the Royal Family?
Primó had anticipated Carlo’s question. Hearing it now, he was not panicked at all and smiled as he explained: “Your Majesty, our major expenditures currently consist of three items: military expenses, accounting for 1% of total fiscal expenditure, with approximately 6 million pesetas annually as military expenses.
The remaining two items are railway construction and industrial construction.
Over the entire year of 1870, we built over 500 kiloters of railways and 4,000 kiloters of roads. The construction costs for these railways and roads were also one of our major expenditures.
The Transportation Departnt’s expenditure was also as high as 23%, with our expenses in transportation construction reaching 95 million pesetas.
Industrial construction was not as exaggerated, but the funds spent on purchasing production materials from abroad, building industrial bases, and encouraging private enterprises also reached 70 million pesetas.
Adding in expenditures for education, dical treatnt, and other areas, as well as governnt personnel wages and so on, 8 million pesetas was already the result after the governnt had practiced frugality multiple tis.”
For Spain to achieve reform and industrial expansion, it was fundantally impossible without investing large amounts of funds.
Spain’s technology in the industrial aspect was already behind, requiring the purchase of large amounts of industrial equipnt and related technology information from abroad.
At the sa ti, building factories, laying production lines, and recruiting workers all required costs, which was also why the Spanish Governnt’s fiscal expenditure remained high.
However, all of this had returns, at least in Primó’s view;
these expenditures had hope of yielding results within the next three years, contributing to Spain’s economic developnt.
Just the various factories and enterprises blooming across Spain during this period destined Spain’s economy to enter a phase of stable growth in the future.
This was also why Primó was willing to have such huge governnt expenditures, because with investnt ca returns;
the funds spent would feedback to the governnt in various ways, allowing the governnt to earn even more in the future.
Hearing Pri Minister Primó’s reply, Carlo nodded, dispelling the doubts in his heart.
Although Spain did not have a large-scale navy, military expenses were still considerable. Especially in 1870, after successively experiencing the Cuban War of Independence and the Carlist faction rebellion, the military expenses for suppressing those two rebellions were not small.
In addition, the Spanish Governnt needed to maintain an army of over 100,000 people, so military expenses were actually not excessive and were within a reasonable range.
Fortunately, the indemnity from Morocco basically wiped out Spain’s 1870 financial loss.
Plus loans from the Italian Governnt, and the full-year total fiscal revenue in 1871, the upcoming Spanish Governnt still had plenty of confidence to handle new construction and expenditures.
In the end, it was because of the separatists in Cuba and the Philippines that Spain was forced to maintain an army size of over 100,
After all, these two regions not only loved to stir up independence, but were also separated from the Spanish Mainland by very long distances. Every suppression of rebellion required the governnt to pay a heavy price, and regardless of the final war outco, it was actually a loss for the Spanish Governnt.
Carlo nodded and continued to raise his question: “Is next year’s available fiscal budget sufficient? If next year’s finances still face huge losses, I’m afraid there will be no one to help us fill the gap.”
Primó had actually considered this question long ago: “The governnt’s current available fiscal budget is close to 150 million pesetas, plus next year’s fiscal revenue, continuing our construction is no problem.
1871 has hope of being a year of peace;
if there is no war, our military expenses can be reduced to around 75 million pesetas.
The reduced military expenses can be used for railway and road construction or industrial expansion, or to continue promoting literacy education, which is basically sufficient to et the governnt’s fiscal needs for the new year.”
Don’t think that Spain’s fiscal revenue of 48 million pesetas was high;
in reality, many of the governnt’s expenditures were fixed and basically impossible to reduce.
This was also why Pri Minister Primó had to calculate even millions of pesetas carefully. If a project overspent by a few million pesetas, adding up dozens of construction projects, the wasted funds would be enough to bankrupt the Spanish Governnt.
“Pri Minister Primó, since our fiscal budget is sufficient, then for the new year, the governnt’s focus should continue to be on the construction of heavy industry, as well as broader literacy education and infrastructure construction including railways and roads—what do you think?” Regarding the use of next year’s fiscal budget, Carlo planned to offer his opinion.
48 million pesetas in fiscal revenue seed like a lot, but converted to US dollars it was only about 21 million, and converted to pound sterling only 531 million pounds.
If this funds were only placed on a few key projects, perhaps certain results could be achieved. But if wanting comprehensive construction blooming in multiple areas, it was a bit too idealistic.
Carlo’s purpose was also simple: influence the governnt to focus on constructing heavy industry as much as possible, with secondary goals of literacy education and infrastructure construction;
everything else could be put on hold for now.
Fields like dical treatnt and agriculture currently had little room for developnt. Spain’s land situation determined that agriculture’s ceiling was just like that;
even achieving self-sufficiency was problematic, let alone large-scale export of agricultural products.
dical treatnt was completely limited by the current technology situation. If money was invested into dical treatnt, it might not break even within ten years.
For the funds-scarce Spanish Governnt, these two projects could be temporarily abandoned for now, and focus should be placed on the more profitable heavy industry.
Of course Carlo had the right to offer suggestions on so of the governnt’s work. Pri Minister Primó also did not oppose Carlo’s suggestions;
he just did not want Carlo to interfere too much in the governnt’s work and impose his own ideas on the governnt for execution.
“Your ideas are the sa as mine, Your Majesty.” Primó nodded, clearly recognizing Carlo’s ideas to so extent: “For current Spain, the developnt of agriculture and dical treatnt can be postponed for a while.
The governnt’s current focus will be on the construction of heavy industry and railways, and the promotion of literacy education will also be pushed forward as much as possible.
Before Spain’s finances have sufficient budget, other construction can be postponed;
currently, only heavy industry, education, and infrastructure construction are the most important to us.”
First update of 3,000 words, seeking support!
Day 6 of Riwandi, already updated 3,000 words, seeking support!
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