To What Extent Did Industrial Development Under Witte Make Russia a More Stable and Prosperous Country

Topics: Economics, Investment, Economy Pages: 2 (685 words) Published: January 30, 2012
To what extent did industrial development under Witte make Russia a more stable and prosperous country? Even thought there were problems with Witte's approach to development is not to deny that Russia needed major reform. Its defeat by Western powers in the Crimean War (1853-1856), lack of industrial development, poor infrastructure, left it much weaker than its competitors in Europe. As finance minister, Witte pushed for greater exports, ambitious industrialisation and to get large foreign loans. With these policies he hoped to make Russia a more competitive with the rest of Europe. His plans for Russia's economic development, which, though ambitious and in some ways successful, created new ones, which created long-term implications for the country's economic and social making them unstable. Witte had decided to finance his ambitious industrialise through foreign loans as a way to stimulate economic growth. Once these loans were secured by Witte the county enjoy impressive economic growth, a healthy pace of modernisation as well as other aspects of modernisation within Russia. As by 1900 Witte had seen his ambitious industrialisation start to work from a Russian point of view as industrial production had increased significantly from 1880 to 1900 with coal output 5x higher from 3,290 to 16,160 (thousand tons), petroleum export increased 30x from 382 to 10,684 (thousand ton). Also the railways within 15 years had increase from 5,800km to 59,616km. However Russia failed to recognise is that these loans where short term to strengthen Russia military for the expected world war that was going to happen, which was one of the reason for French and British funding as at they saw Russia as the weak link in their plan if war was to breakout. They also failed to recognise that by taking out large foreign loans made the Russian market vulnerable as if the French economy was to faultier it would mean the end of the loans it needed. Which it did at the end of world war 1 as...
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