An English Capital Initiative in the Ottoman Empire: The Ottoman Financial Association (Şirket-i Maliye-i Mahdûde-i Osmanî)

Abstract

International trade and foreign capital investments are the main spreading channels of capitalist system to the periphery. Having completed the Industrial Revolution, the encounter of England with the protectionist foreign trade policies in Continental Europe has directed it to the other parts of the world in order to meet its raw material and market needs. The Ottoman Empire with its rich natural resources and transportation facilities open to development, has become an attractive investment area for developed countries in need of raw materials and markets. Foreign capital investments made by English capitalists in the Ottoman Empire are an important component of the post-1838 period. Especially in the period following the Crimean War, England made investment initiatives in many diferent areas in the Ottoman Empire. One of these initiatives is the Ottoman Financial Association which was established in London and opened branches in diferent cities of the Ottoman Empire. Although the company was established to encourage cotton production in Ottoman lands due to the cotton shortage, price increases and high proftability that emerged in the international markets during the American Civil War, it did not turn into a long-term venture. In this study it is aimed to detail the economic and historical background of a diferent foreign capital initiative carried out in the Ottoman Empire. In this context, its establishment process, activities and the reasons of termination of its activities are investigated using the archival sources and newspapers of the period. The fndings of the study reveal some relations extending to the Panic of 1866.