On the Export of Capital and the Rule of Borrowing Countries

Abstract

Since V.I. Lenin' "Imperialism"(1917), many considerations has been made on the capital export of European Powers and its relation to the acquisition of colonies. But, there still remains two important problems. One is the features of British, French and German capital export, and the other is why and how these capital export led to the rule of borrowing countries. In this article, I have tried, relying upon H. Feis' "Europe: the World's Bankei 1870-1914", to present some hypothesis on these problems. The conclusion is as follows. (1) The features of the capital export of European Powers had to be analysed in relation to the structure of national economy, especially sources of surplus capital and the method of capital export by various banks. (2) Each Powers had its own policy about capital export, that is, regulating foreign listings, adjusting it with national interest, favoring their own colony, securing concessions, and protecting investments. (3) These policies, especially securing concessions and protecting investments had led to the rule of borrowing countries, by taking the charge of railway construction and other public works, of financial revenues mortgaged. Thus, finally, capital lending led to the confiscation of public works, public finance, lands and the central bank. This was the colonization of borrowing countries. (4) The features of British, French and German Capital Export had to be clarified from above viewpoints.