Page:The Russian Review Volume 1.djvu/57

Rh Notable example of this kind are the works of Schmidt in Kovno, Otto Erbe in Riga, "Forum" in Zaverze, and many others.

Russian foundries and factories imported most of their machinery from Germany. German steam-engines, gasoline and electric motors were used almost exclusively.

As a matter of fact, most of the foundries and factories of Southern Germany, particularly in Westphalia, worked almost solely for the Russian markets. The fame of such manufactories as the machine works of Bergman and Co. was due almost entirely to their export trade to Russia. The Russian market was largely responsible for the rapid growth of German factories producing typographical supplies and materials.

All this was achieved by Germany in a comparatively short time. In 1904, the German exports to Russia amounted to only about 50,000,000 marks. But during the year following, taking advantage of Russia's weakened condition on account of the Russo-Japanese War, Germany succeeded in signing a commercial treaty with Russia, which practically compelled her to deal almost exclusively with Germany. This treaty made it possible for German exports to gain a virtual monopoly of the Russian markets. During the year preceding the declaration of war, German exports to Russia amounted to over 800,000,000 marks, which means that they increased sixteen fold during one decade.

But something else was needed besides a favorable commercial treaty in order to make such an enormous development possible. The moment the German manufacturers, merchants and exporters realized the value of the Russian markets, they began to apply all their energies towards obtaining control over them. Whole armies of German salesmen, and often the manufacturers themselves, travelled through the country, trying to induce the Russian businessmen to deal in goods of German make, in preference to all others. And they were, in most instances, very successful.

The exporters were not anxious, at first, to make large profits. On the contrary, they were satisfied with a very small return, as their main object was to place on the Russian markets as large quantities of their goods as was possible. They were not disturbed, or discouraged, by the fact that Russian businessmen are accustomed to buying on credit. Realizing that the rate of interest on investments in German government bonds is only two, or two and one half per cent, and that the rate paid by private banking institutions is only about three per cent, German businessmen were perfectly willing to extend credit to