How far did Witte improve and modernise the Russian economy?
Witte was a major influence in the improvement and modernisation of the Russian economy. Prior to the ‘Witte system’, Russia lacked in key factors required for rapid industrialisation, which would be the starting point of economic growth. Russia had a very little business class with vast numbers of peasants whom did not have complete freedom, which limited their migration. Also they didn’t have the significant funds to invest in an industrial revolution.
So Witte introduced a plan for economic growth known as the ‘Witte System’. The government were to sponsor and direct the economic growth, emphasising the production of capital goods. Also, due to lack of funds, Russia gained financial backing from foreign countries such as Britain, which was a major factor for the development. Finally, the ‘Witte System’ enforced extra taxes to the over taxed peasants, creating more funds. Already Witte was making major progress for the ‘economically backward’ Russia and he would go on to make further progress, as industrialisation was finally starting to emerge in Russia, which modernised income greatly in comparison to the grain export industry that they so heavily relied on. The Witte system made continued progress for the Russian economy by the construction of the Trans-Siberian railway line, which ran 7000km across the Russia Empire, from St Petersburg in the West to Vladivostok in the East. Due to the Trans-Siberian railway, communication was vastly improved as it connected the whole of the vast size of Russia. Also, as it reached the Pacific Ocean, it meant Russia could trade with Asian countries such as China and Japan, due to shipping ports, and could reach back to St Petersburg. The Trans-Siberian railway helped the growth of Russian influence in the Far East.
The Impacts of the Witte system helped improve and modernise the Russian Economy greatly. Coal, Iron and Oil production all rapidly rose in Russia...