In both cases the German directors took care that the really profitable concessions obtained by the railway and rendered workable solely by its co-operation should benefit only themselves. The Anatolian Railway as a whole, though under German direction, had maintained, to a certain extent, its international character. But it became increasingly a milch cow for the enterprises that the Germans reserved for themselves. After five years of conflict against opposition from Russian, British, and latterly French interests, an additional convention was signed on June 2, 1908. This agreement laid down the route to be taken through the Taurus and Amanus Mountains, and made provision for construction as far as Helif. The Mosul route was chosen owing to the oilfields in that neighbourhood. The Second Bagdad Loan, with a capital of 108 million francs, was finally floated in June 1910. Meanwhile, the progress of construction led to a desire for the floating of the Third Bagdad Loan, the amount of which had been fixed at 119 million francs. At this moment (1910) the enterprise had been well advertised, and the necessary capital might have been obtained. But Turkey was endeavouring to raise loans for other purposes; and the French, to whom she turned, began to demand in return an increased measure of control in Turkey. The Entente Cordiale, with its policy of distrust of Germany, was beginning to make itself felt, and the English CasselBabington Smith group of financiers, from whose desire to invest in Turkey great things had been hoped, were, to use the German comment, whistled back' by the combined Entente Governments. It was at this time that the Paris Temps' made the oft-quoted statement'Londres ne veut pas; Berlin ne peut pas.' 6 The Germans were determined to show that Berlin both could and would. Helfferich, then Director of the Deutsche Bank and later a Cabinet Minister, was sent by the Kaiser to Constantinople in December 1910. His orders were at all costs to prevent any increase of French influence and power. Helfferich arranged a loan to Turkey of 7 million Turkish pounds (160 million francs) at an interest of 4 per cent. Germans and Austrians rallied to its support under the leadership of the Deutsche Bank. In the course of the year 1911 (the year of the Agadir incident), the loan was floated at 86. The proposed Third Bagdad Loan, being both smaller and, if anything, on better security, would have been easier to place on the market. But the interests of the railway had to be subordinated to those of Germany in her rivalry with France; and the Bagdad Railway thus lost its last chance of financial success, as it forfeited finally its claim to be considered an international enterprise. The Turkish Revolution of 1908 had left German influence, after a period of eclipse, as strong as before; and the extremists among the men who had overthrown Abdul Hamid continued enthusiastically his Pan-Islamic policy. But the Revolution, and the temporary confusion arising out of it, had led to a considerable increase in the cost of labour and material. The calculations of the Construction Company were thus thrown out, and their profit turned into loss. Nevertheless, in spite of growing French and British mistrust, the bonds of the Third Bagdad Loan were thrown on the market at the end of 1911. Every effort was made to bring it to success. The Anatolian Railway subscribed 24 million francs. The unfortunate Construction Company, which never yet had paid a dividend, proffered the 12 million marks which comprised its entire capital and reserves. 5 The part played by the Anatolian and Bagdad Railways, which were administered and worked as one, during the years of war, is fairly well known. The German General Staff in their reports on the Balkan War attributed the preservation of Constantinople and its European hinterland largely to the Anatolian Railway and the ferry service worked in connexion therewith. The Great War hastened and completed the ruin of the Bagdad Railway; but it merely accelerated an inevitable conclusion. The accompanying balance sheet to Dec. 31, 1916, the last definite statement of accounts possible under the circumstances, bears witness to the utter breakdown of the scheme. No account is taken of the loss through capture by the British of the SamarraBagdad line (which cost 27 million francs), nor of the |