The State Steamshipping Enterprise during the Reign of Sultan Abdulhamid II : "Idare-i Mahsusa" and the Ottoman Navy

Abstract

"The Idare-i Mahsusa, or IM (The Special Bureau)" was a steamshipping enterprise managed by the Ottoman Navy during the reign of Sultan Abdulhamid II (1876-1909). Because private enterprise were not insufficiently capitalized to compete with foreign companies, the Ottoman government had to establish a national flag for the purpose of managing domestic steam navigation. Unfortunately this attempt failed in the end.This paper analyzes the financial documents of the IM in order to clarify why its business came to a standstill. The author argues that the IM was marked by two characteristics which seriously affected its management. One was its being under the direct control of the Navy, the other was its being obligated to undertake military and official transport services.Concerning the former, excessive interference by naval officers who knew little of the maritime business end prevented the IM from growing as a commercial enterprise. They failed to arrange operations in order to meet the needs of customers. Moreover, unplanned expansion of the fleet incurred tremendous expenditures. Furthermore, arbitrary personnel management on the part of the Navy gave the IM fewer chances to train their own civilian captains and navigation officers. On the other hand, the fares for military and official shipping, mainly for the transport of recruits, veterans, hajjis (pilgrims) and immigrants, had originally been set lower than the normal rate by the government. Moreover, payment was often delayed, so although on paper the accounts appeared balanced, the IM actually had perpetual difficulty in raising funds.The original aim of establishing the IM was "development of steam navigation, " but having attached so much importance to its public and military contribution, the IM not only suffered heavy burdens, but was also prevented from developing into an independent commercial shipping enterprise. From macroscopic points of view, the reason why Ottoman steam navigation failed to establish itself was its subordinated integration into the capitalistic world economy and the progression of peripheralization in the Ottoman Empire. Nevertheless, it is true that in the Ottoman state itself, there were vital problems that prevented its own shipping business from favorable development.