You are here

Chapter 15

Illegitimate Bank-notes--Hampering the Bank's work--The grand
fiasco of the Tobacco Corporation--Magnificent behaviour of the
natives--The Mullahs and tobacco--The nation gives up
smoking--Suppression of the monopoly--Compensation--Want of
tact--Important European commercial houses and their
work--Russian and British trade--Trade routes--The new Persian
Customs--What they are represented to be and what they
are--Duties--The employment of foreigners in Persia--The Maclean

The work of the Imperial Bank has at various times been hampered by speculators who tried to make money by misleading the public. Their speculations were always based on the prestige of the bank. For instance, take the Bushire Company and the Fars Trading Company, Limited, companies started by native merchants. They illegally issued bank-notes which, strangely enough, owing to the security found in the Imperial bank-notes, found no difficulty in circulating at a small discount, especially in Shiraz.

Naturally, the Imperial Bank, having in its conventions with the Persian Government the exclusive right to issue bank-notes payable at sight, protested against this infringement of rights, but for a long time got little redress, and some of the fraudulent bank-notes are to this day circulating in Southern Persia.

Sooner or later this was bound to interfere with the bank, as the natives, unaccustomed to bank-notes, confused the ones with the others. Moreover, the enemies of the bank took advantage of this confusion to instigate the people against the Imperial Bank, making them believe that the word "Imperial" on the bank-notes meant that the issuing of bank-notes was only a new scheme of the Government to supply people with worthless paper instead of a currency of sound silver cash. In the southern provinces this stupid belief spread very rapidly, and was necessarily accentuated by the issue of the illegal bank-notes of local private concerns, which, although bearing foreign names, were merely Persian undertakings.

Necessarily, the many foreign speculations to which we have already referred, cannot be said to have strengthened confidence in anything of European importation; but the grand successive abortions of the Belgian and Russian factories--which were to make gas, sugar, glass, matches, etc.--are hardly to be compared in their disastrous results to the magnificent English fiasco of the Tobacco Corporation, which not only came to grief itself, but nearly caused a revolution in the country. It is well-known how a concession was obtained by British capitalists in 1890 to establish a tobacco monopoly in Persia, which involved the usual payment of a large sum to the Shah, and presents to high officials.

The company made a start on a very grand scale in February, 1891, having the whole monopoly of purchase and sale of tobacco all over Persia. No sooner had it begun its work than a commission of injured native merchants presented a petition to the Shah to protest against it. A decree was, however, published establishing the monopoly of the corporation all over Persia, and upon this the discontent and signs of rebellion began.

Yet this affair of the tobacco monopoly showed what fine, dignified people the Persians can be if they choose. The want of tact, the absolute mismanagement and the lack of knowledge in dealing with the natives, the ridiculous notion that coercion would at once force the Persians to accept the tobacco supplied by the Corporation, fast collected a dense cloud of danger overhead. Teheran and the other larger cities were placarded with proclamations instigating the crowds to murder Europeans and do away with their work.

But the Persians, notwithstanding their threats, showed themselves patient, and confident that the Shah would restore the nation to its former happiness. In the meantime the company's agents played the devil all over the empire. It seems incredible, even in the annals of Persian history, that so little lack of judgment could have been shown towards the natives.

The Mullahs saw an excellent opportunity to undo in a few days the work of Europeans of several scores of years. "Allah," they preached to the people, "forbids you to smoke or touch the impure tobacco sold you by Europeans." On a given day the Mugte halh, or high priest of sacred Kerbalah, declared that the faithful throughout the country must touch tobacco no more; tobacco, the most cherished of Persian indulgences.

Mirza Hassan Ashtiani, mujtehed of Teheran, on whom the Shah relied to pacify the crowds now in flagrant rebellion, openly preached against his Sovereign and stood by the veto of his superior priest at Kerbalah. He went further and exhorted the people to cease smoking, not because tobacco was impure, but because the Koran says that it is unlawful to make use of any article which is not fairly dealt in by all alike.

At a given date all through the Shah's dominions--and this shows a good deal of determination--the foreigner and his tobacco were to be treated with contempt. Tobacco was given up by all. In the bazaars, in the caravanserais, in the streets, in the houses, where under ordinary circumstances every man puffed away at a kalian, a chibuk (small pocket-pipe) or cigarette, not a single soul could be seen smoking for days and days. Only the Shah made a point of smoking in public to encourage the people, but even his wife and concubines--at the risk of incurring disfavour--refused to smoke, and smashed the kalians before his eyes. In house-holds where the men--ever weaker than women--could, after weeks of abstinence, not resist the temptation in secrecy, their wives destroyed the pipes.

For several weeks not a single individual touched tobacco--a most dignified protest which quite terrified the Shah and everybody, for, indeed, it was apparent that people so strong-willed were not to be trifled with.

In many places the natives broke out into rebellion, and many lives were lost. Nasr-ed-din Shah, frightened and perplexed, called the high Mullah of Teheran to the palace (January 5th-6th, 1892). By his advice the tobacco monopoly was there and then abolished by an Imperial Decree, and the privileges granted for the sale and export of tobacco revoked. Furthermore, the Mullah only undertook to pacify the people on condition that all foreign enterprises and innovations in Persia should be suppressed; that all people imprisoned during the riots should be freed, and the families of those killed fully indemnified.

The sudden end of the Tobacco Corporation necessarily led to much correspondence with the British Minister, Sir Frank Lascelles, on the question of compensation and damages to the company which, depending on its monopoly, had entered into agreements, and had already paid out large sums of money. It was finally agreed that the Shah should pay £500,000 sterling compensation, and take over the assets of the company, supposed to be some £140,000, subject to realisation.

With the assistance of the Bank of Persia, a six per cent. loan was issued, which was taken up principally by the shareholders of the Tobacco Corporation. The interest and the sinking fund of this loan were punctually met until the year 1900 when it was repaid in full on the conclusion of the Russian loan.

In England this failure seems to have been ascribed to Russian intrigue, but it must in all fairness be said that had the Russians tried a similar scheme in a similar manner, they would have fared even worse than we did. Even Persian concerns established on European principles have serious troubles to contend with; but it was madness to believe that an entire Eastern nation could, at a moment's notice, be forced to accept--in a way most offensive to them--such an article of primary use as tobacco, which, furthermore, was offered at a higher price than their own tobaccos which they liked better.

There are in Persia a few important European commercial houses, such as Ziegler and Co., and Hotz and Son, which have extensive dealings with Persians. Ziegler and Co. deal in English imports and in the exportation of carpets, etc., whereas Hotz and Son import Russian articles, which they find cheaper and of easier sale. Both are eminently respectable firms, and enjoy the esteem of everybody.

Notwithstanding the Swiss name, Ziegler and Co. is an English firm, although, as far as I know, it has not a single English employee in its various branches in Persia. The reason, as we have seen, is that foreigners are considered more capable. It has in the various cities some very able Swiss agents, who work most sensibly and excellently, and who certainly manage to make the best of whatever business there is to be done in the country. For over thirty years the house has been established in Persia, having begun its life at Tabriz and then extended to Teheran, Resht, Meshed, Isfahan, Yezd--the latter so far a non-important branch--and Shiraz, Bushire, Bandar Abbas and Bagdad, where it has correspondents working for the firm.

The house imports large quantities of Manchester goods and exports chiefly carpets, cloths, opium and dried fruit. The carpets, which are specially made for the European market, are manufactured chiefly at Sultanabad where thousands of hands are employed at the looms, scattered about in private houses of the people and not in a large factory. The firm takes special care to furnish good wool and cottons coloured with vegetable dyes, and not with aniline. Ancient patterns are selected and copied in preference to new designs. Of course, besides these, other carpets are purchased in other parts of the country. Carpets may be divided into three classes. The scarce and most expensive pure silk rugs; the lamsavieh or good quality carpets, and the mojodeh or cheaper kind. There is a good demand for the two latter qualities all over Europe and in America.

Articles specially dealt in are the cotton and wool fabrics called ghilim, the designs of which are most artistic; and to a certain extent other fabrics, such as the vividly coloured Kashan velvets, the watered silks of Resht, the Kerman cloths resembling those of Cashmir, the silver and gold embroidered brocades of Yezd, and the silk handkerchiefs manufactured in the various silk districts, principally Tabriz, Resht, Kashan and Yezd.

The stamped and hand-drawn kalamkars in stringent colours upon white cotton also find their way in large quantities to Europe, but are more quaint than beautiful. Large and ill-proportioned figures are frequently attempted in these designs. When of truly Persian manufacture the colours are said to be quite permanent under the action of both light and water.

The firm of Hotz and Son deals in well-nigh everything, and has made good headway of late years. It has large establishments at Isfahan, Shiraz and Bushire, and two agencies, one at Ahwaz on the Karun River, and one in Teheran (Groeneweg, Dunlop, and Co.); while it has correspondents in Bagdad, Busrah, Hongkong and Rotterdam, the head offices being in London. Its carpet manufacturing business in Sultanabad is now carried on by the Persian Manufacturing Co. The exports are similar to those of Ziegler and Co.

There are also smaller firms, particularly in Teheran, such as the Toko, Virion, and others who do a retail business in piece goods and articles of any kind, and are entirely in the hands of foreigners, Belgians, Austrians, and French. Without reference to statistics, which are absolutely worthless in a country like Persia, the yearly foreign trade of Persia, divided between the Gulf ports and the north and north-western and south-western frontiers, may be put down roughly at some nine or ten millions sterling.

The Russian trade in the north may be considered as about equal to the British in the south. Then there are the goods brought by the Trebizonde-Tabriz trade route from Turkey and the Mediterranean, and by the Bagdad-Kermanshah, another very important route.

The extravagant system of farming prevailing until quite lately in Persia, as well as the uncertainties of Customs and revenue returns, makes it difficult to give trustworthy figures; but in future, probably this year, we may expect some more reliable data from the new Belgian customs office, a really sensible and well-managed administration organised by Monsieur Naus, who is, indeed, to be congratulated on the success with which his efforts at bringing about so radical a reform in the system of collecting duties have in so short a time been crowned. We often hear in England that the Customs of Persia are absolutely in the hands of Russia, and are worked by Russian officials. Even serious papers like The Times publish misleading statements of this kind, but nothing could be more erroneous. M. Naus, at the head of the Customs, is a Belgian, and so are nearly all the foreign employees (there are one or two French, I believe) in Persian employ, but not a single Russian is to be found among their number. That the Russians hold a comparatively trifling mortgage on the Customs as a security for their loan is true, but, as long as Persia is able to pay interest on it, Russia has no more power over the Persian Customs than we have. Under regular and honest management, like the present, the Customs have already given considerable results, and were it not for the weakness of the Government in the provinces, the Customs receipts might easily be doubled, even without a change in the tariff.

The duties levied in Persia are determined by the treaty of Turkmantchai with Russia in 1828, by which a uniform and reciprocal five per cent. for import and export was agreed to, a special convention, nevertheless, applying to Turkey, which fixed a reciprocal 12 per cent. export and 6 per cent. import duty, and 75 per cent. on tobacco and salt. An attempt was made to negotiate a new commercial treaty with Russia last year, but unfortunately, matters did not go as was expected by M. Naus, who was very keen on the subject. A high Russian official was despatched to Teheran who caused a good deal of trouble, and eventually the whole matter fell through.

Regarding the employment of foreigners by the Persian Government, it is not out of place to recall the Maclean incident.

An agreement had been entered into with Mr. Maclean, a British subject, and a former employee of the Imperial Bank, to take charge of the Mint, in order to bring it up to date and work it on more business-like principles than at present. This led to a demand from the Russians that a similarly high office in the Shah's Government should be given to a Russian, so that this appointment might not be taken as a slight against Russia; or, if this were not possible, that two or three Russians might be employed instead in minor capacities in the new Customs. The Persian Government would not agree to this, but owing to the pressure that had been brought to bear by the Russians they felt obliged to dismiss Mr. Maclean. The British minister necessarily then stood up for British rights, and a great scandal was made of the whole affair, and as an agreement for three years had been signed, the Persian Government had to pay the salary in full for that period, although they had only availed themselves of Mr. Maclean's services for a few months.

It is to be regretted that the Sadrazam acted in so reckless a manner, for the whole matter might have been settled quietly without the slightest disturbance and unpleasantness. Anyhow, this led to a decree being passed (in 1901) that in future no British subject, no Russian, and no Turk will be accepted in Persian employ. This includes the army, with the exception of the special Cossack regiment which had previously been formed under Russian instructors. It can safely be said that there is not a single Russian in any civil appointment in Persia, no more than there is any Britisher; but, in the Customs service particularly, M. Naus being a Belgian, nearly all the employees are Belgian, as I have said, with only one or two French lower subordinates.

The Customs service is carried on with great fairness to all alike, and the mischievous stories of Russian preference and of the violation of rules in favour of Russian goods are too ridiculous to be taken into consideration. One fact is certain, that any one who takes the trouble to ascertain facts finds them very different from what they are represented to be by hasty and over-excited writers.