Empire Rising: Spain

The influx of foreign capital was something Carlo hadn’t anticipated, but it is a good thing for Spain.

The companies listed on the stock exchange have benefited from this, especially the share prices of railway companies, which have increased by at least ten percent.

The biggest impact on Spain is that many railway companies have thereby obtained additional funds, making the completion of the railway constructions planned in the third five-year development plan a certainty.

The influx of French capital has its pros and cons, but for the current Spain, the benefits far outweigh the drawbacks. The large influx of funds from French capital can accelerate Spain’s industrial development, making its five-year development plan more effective.

Although this will also allow French capital to have a deeper influence on Spain, the extent of this influence is controllable.

Spain is on the path of state capitalism, with the largest domestic capitals being the government and the Royal Family. In this situation, unless all French capital is transferred to Spain, a portion of it cannot influence the decision-making of the Spanish Government.

In some cases, these foreign capitals may even become lambs to the slaughter; should the relationship between Spain and France break down, the industries and properties into which French capital has invested in Spain would be forcibly reclaimed by the Spanish Government.

Because the Spanish Government did not prevent the influx of French funds into Spain’s stock exchange, it led to rapid growth in the stock prices of all companies involved in railways.

At this time, Spain is indeed a relatively good destination for French capital. Because of the impact of the previous economic crisis, the economies of European countries have yet to fully recover.

In contrast, Spain, which was not significantly affected by the economic crisis, is currently experiencing one of the fastest economic growth rates in all of Europe.

It is not just the railways in the five-year development plan that have attracted the attention of French capital; other plans related to industrial construction have also attracted capital from France and even other European countries.

The influx of large amounts of money has sparked an investment boom in the Spanish stock market, with many investors seeing their assets increase several times over in just a few days.

With Spain welcoming the influx, French capital quickly formed close cooperation with Spanish enterprises. These capitals are not content with merely purchasing the shares released by Spanish companies; they even want to directly purchase large-scale shares from the shareholders of some railway companies.

Regarding these actions of French capital, Carlo took a laissez-faire attitude.

At least for now, French capital poses no threat to Spain; instead, they can accelerate Spain’s industrialization, strengthening Spain’s capital power even more.

If Spain relied solely on domestic capital to promote its industrialization, by the time Spain completed its industrialization, other European Powers would have already achieved more advanced levels of industrial progress.

Even if only to accelerate the progress of Spain’s industrialization, absorbing these foreign capitals is very necessary.

Since it is already certain that a substantial amount of capital from France and even other countries is flooding into Spain, the most important task now is to use these foreign capitals rationally to promote Spain’s economic development.

Currently, foreign capitals are mainly concentrated in Spain’s railway construction, investing primarily in industries related to railways.

As long as a way can be found to get them interested in Spain’s other industries, there is hope for a comprehensive economic growth in Spain.

With Carlo’s intentional push, Spanish newspapers started reporting news related to other industries, and even industries related to finance began predicting that some sectors would experience significant development in the future.

Although it did not have effects similar to that of the railway industry, it did attract a small portion of foreign capital to invest in Spain’s agricultural product processing industry, manufacturing industry, and other sectors.

It can be foreseen that with the push from these foreign capitals, Spain’s other industries will also enter a golden stage of development.

Although the influx of these foreign capitals will cause some local small and medium-sized enterprises to face larger-scale competition or even the crisis of bankruptcy, it is beneficial to the entire industry.

As long as all sectors in Spain can develop quickly, sacrificing some small and medium-sized enterprises is very necessary. This era is inherently the age of monopolistic giants, and these small and medium-sized enterprises do not have such significant roles in Spain, so there is no need to regret for them.

Of course, development must also include the prevention of overcapacity issues.

The risks posed by overcapacity are considerable, and it could even trigger a new round of economic crisis. Although Carlo wishes for Spain’s economy and industry to develop rapidly, he is more against Spain facing a severe economic crisis.

For this reason, as foreign capital drives rapid economic development in Spain, Carlo has issued several requirements to the Cabinet Government, the main ones being the prevention of overcapacity and blind development.

Spain’s development should be purposeful, focusing on building the industries that are scarce and greatly needed in Spain, rather than focusing primarily on those that are already quite strong.

For example, in the field of steel manufacturing, Spain’s steel production already ranks fifth in the world; there’s currently no need to pursue greater steel output unless the domestic demand for steel products expands.