In the early 1800s, Egypt connected the enormous Ottoman Empire with the even larger African continent. The Ottoman Empire included parts of modern-day Europe, Africa and the Middle East. Both were huge areas of trade. However, they were both struggling to find their place in a rapidly industrializing world.

For centuries, the Ottoman Empire had been at the center of trade in Eurasia. It also was an important manufacturing center for popular handmade goods.

Soon, the Ottomans faced competition. Europe had begun industrializing. Their cheaper, machine-made goods became a competition for the Ottoman Empire. This caused increased unemployment and de-industrialization in the empire. Meanwhile, production in much of Africa had fallen after centuries of the Atlantic slave trade. Africa was seen as a place for collecting materials for European factories, not a place for factories themselves.

Muhammad Ali and Egypt’s industrial expansion

Egypt, however, was an African country that was still part of the Ottoman Empire. In the early nineteenth century, a new Egyptian ruler named Muhammad Ali wanted to quickly industrialize. He had to figure out how to work with the Ottoman sultans and the big European powers. He also could not ignore the Egyptian people.

Ali was given control of the Ottoman forces in Egypt at a pretty rough time. Egypt had recently suffered a crushing defeat during a war with France. Eventually, Britain helped to push the French out of Egypt. After the war, Egypt was still technically part of the Ottoman Empire. In reality, though, Ali made it an independent state. Ali set up a plan to modernize Egypt. He began with the military. He required Egyptian peasants to enlist, hired European advisers, and bought modern weapons. By 1831, he was an independent ruler of a stronger, more modern Egypt.

Some wealthy Egyptian leaders disagreed with modernizing. Ali kept these leaders happy by maintaining many Egyptian traditions. At the same time, he began modernizing Egypt’s economy. Egypt already produced small quantities of cotton that were sold to British cloth factories. Ali encouraged even more cotton production in Egypt. This changed life for most Egyptian peasants. Peasants usually grew cotton in the summer and fall and then rested in the winter. Now, they were forced to spend their winters growing cotton.

Ali’s government used this money from cotton production to make factories. These factories produced clothing, food and other goods. This would help Egypt profit from its own industrialization. By the late 1840s, it looked like Egypt would eventually become an industrial power. But by the 1850s, Egypt’s economy began to decline. The factories stopped producing. By the 1880s, Egypt was in serious debt to British banks. Egypt was technically independent. In reality, the British banks were in control and the country was functioning like a British colony.

What went wrong? Three explanations…

One explanation for the collapse of the Egyptian economy was a failure of leadership. Members of Ali’s family took over after his death, but some experts argue they were not very effective rulers. Most of their money came from cotton. This was dangerous if cotton crops failed. They also borrowed money from European banks to support their luxurious lifestyles. These banks used this debt to influence Egypt’s government.

A second explanation for Egypt’s failure was environmental. Egypt didn’t have the coal resources Britain and Europe had. As a result, Egyptian factories had to run their machines using donkeys and other animals. This system was more expensive and less efficient than burning coal.

A third explanation was that other countries purposely destroyed the Egyptian industry. These countries also made cloth. They did not want Egypt as their competition. They began taxing Egyptian cloth coming into their countries, making Egyptian products more expensive. At the same time, they forbid Egypt from taxing their products. In the end, Egyptian factories just could not match low European prices.

Reform and tradition

In this difficult economic climate, the Egyptian people had a problem similar to what many nations faced during industrialization. Some looked to modernize and become more like Europeans. Others wanted to return to their Islamic roots. Some Egyptian thinkers believed there was a middle ground between European and Islamic traditions.

One thinker was Rifa’a al-Tahtawi. Al-Tahtawi believed European beliefs about science and the military could work with Islam. However, he thought the French were not religious enough, and argued that religion was necessary to properly use science.

Meanwhile, Europeans kept meddling in Egypt. One reason was the Suez Canal, built between 1859 and 1869. The canal cut across Egypt, connecting the Mediterranean Sea to the Red Sea’s Gulf of Suez. European powers wanted to control the canal because it was a shortcut to their colonies.

Egypt’s leaders could not agree on how to deal with European involvement. They were already stressed after the cotton industry fell apart, leaving the country with no money. In 1875, the king sold his portion of the Suez Canal Company to the British. This gave the British control of an important national resource. A group of Egyptian military officers were not pleased and took control of Egypt’s government in 1881. The powerful British took advantage of this chaotic moment and seized the country. They restored the king, but only as a puppet ruler that they could control.

By 1882, Egypt’s industrialization and independence had come to an end. Egypt did not become an industrialized nation-state until much, much later. Even then, it happened on much worse terms than Muhammad Ali had originally planned.