Alex iii economy

• Who was in charge under Alex III?


  Vyshegradsky - 1887-1892
• Who did Alexander III appoint in 1892?

  Witte
• What was Witte like?

  Enthusiastic, passionate and capable - he carried things out with gusto - he had energy that his predecessors didnt and a holy passion for railways
• Why was Witte lucky?

  There were no weather issues to affect crops
• What action did Witte take?

  • State sponsored development of heavy industry
  • Foreign loans, investment and expertise
  • High tariffs on foreign industrial goods
  • Rouble put on gold standard
  • Increase in taxation
  • Export of grain
• Witte's state sponsored development of heavy industry

  1. Iron coal, steel factories opened

  2. Used railways as springboard - infrastructure and enabled trade and economy

  3. Stimulated metallurgical and engineering industry
• 60% of iron and steel was used for railways
• 4/5 of locomotives were built in Russia
• Transiberian railways had 25 factories producing 39 million worth of rails
• 1890’s Railway boom :

  • Invested millions of rubles into railways and heavy industry - all state money
  • State owned 70% of railways - 1899
  • 30% privately owned - offered loans, subsidies and profit guarantees
  • led to more investment
• Foreign loans, investment & expertise

  • Good at negotiating loans and used French
  • 1/3 capital inn joint stock companies was foreign investment
  • 45% all industrial enterprises
  • Hughes brothers - Russia still needs guidance
  • 1888 - 16 foreign companies - 1900 - 269
  • Set up in areas untapped - south and oil
  • Was criticised for his dependence on foreign
  • Encouraged Russians to form a middle class of entrepeneurs
• Explain high tariffs

  • . Stimulated internal Russian market
• Explain putting the rouble on gold standard

  • old value doesn’t fluctuate loads - link currency means currency doesnt fluctuate
  • Gained enough gold reserves to do it in 1897
  • Brilliant fo reinvestment and export
• 1891-92 - Great famine - weakened by hunger and susceptible to typhoid and cholera - over 350k died
• 1892 - Russian budget in surplus