3) industrial developments

development of heavy industry: positives

• governments rearment programme: huge orders for metallurgical companies to rebuild the baltic fleet

• industrial production grew

• technological development was taking place in Russia

• tsar visited aircraft designer Igor sokorsky: designed largest aircraft in world with four engines

• becoming less state led and less dependant on foreign investment

• 3 years leading up to 1913 russian entrepeneurs were investing in new factories, paper mills, mines and power plants

• growing internal market and production of consumer goods rose

• agricultural sector became more successfull and prices for farm produce increased

• a balanced economy was not created

development of heavy industry: negatives

• a balanced economy was not created

• growing internal market and production of consumer goods rose

• focus on military requirements meant that industry could not meet the demand for agriculutral tools and machinery

• chemical and machine tool industries remained weak, so these goods were still bought from abroad

• food processing supplied a disproportionate amount

industrial production growth

rate of 6% per anum until 1914

1914 produce

• worlds fourth largest producer of coal, pig, iron and steal

• 5th largest industrial power

number employed

employing over 1000 people in some plants tens of thousands

joint stock companies

started 774 joint-stock companies

consumer goods

actually fell from 52% to 45%

textile industry

1/3 in textile industry

Industrial transformation

• done by segei witte (finance minister 1892-1913)

• coal output increased

• 1897: introuduced new rouble, backed up by value ofm gold im order to strengthen currency and foreign investment

• capital used to fundrailways, telegraphs lines and electrical plants

• 1903-1913: government recieved more than 25% of income from industrial developments

coal output

1890: 183 million puds

1900: 671 million puds

foreign investment

france: 1/3 of all foreign capital

britain: 23%

germany:20%

belgium:14%

USA:5%

railways

• helped open up the russian interior and allowed more extensive exploitation of russias raw materials

• also linked to grain growing areas to the black sea ports, reinforcing export drive

• permitted development of new industries along length of expanding rail network

• transport costs fell bringing down price of goods, while government made money from foreign charges and passenger fares

railways length

1905: 59,616 Km of railways- 66% state owned

1913: russia had second largest railway network in the world, 62,200 Km

still behind USA’s 411,000 Km

Wittes policies

• state encouragement of heavy industry

• massive expansion of railways

• foreign loans, investment and expertise

• strong rouble, adapatation of gold standard

• high tarriffs on foreign indusrial goods

• raised level of taxation