this
composition was:

Privileged debt L22,609,000
Unified debt 58,018,000
Daira Sanieh loan 9,513,000
Domains loan 8,500,000
-----------
L98,640,000

The rate of interest was, on the Privileged debt and Domains loan, 5%;
on the Unified debt and Daira loan, 4%. Under this settlement the total
annual charges on the country amounted to L4,500,000, about half the
then revenue of Egypt. These charges included the services of the
Privileged and Unified debts, the tribute to Turkey and the interest on
the Suez Canal shares held by Great Britain, but excluded the interest
on the Daira and Domains loans, expected to be defrayed by the revenues
from the estates on which those loans were secured. The general revenue
of Egypt was divided between the bondholders and the government, any
surplus on the bondholders' share being devoted to the redemption of the
capital.

The 1880 settlement proved little more lasting than that of 1876. After
a brief period of prosperity, the Arabi rising, the riots at Alexandria,
and the events generally which led to the British occupation of Egypt in
1882, followed by the losses incurred in the Sudan in the effort to
prevent it falling into the hands of the Mahdi, brought Egypt once more
to the verge of financial disaster. The situation was an anomalous one.
While the revenue assigned to the service of the debt was more than
sufficient for the payment of interest and the sinking fund was in full
operation, the government found that their share of the revenue was
altogether inadequate for the expenses of administration, and they were
compelled to borrow on short loans at high rate of interest. Moreover,
to make good the losses incurred at Alexandria, and to get money to pay
the charges arising out of the Sudan War and the Arabi rebellion, a new
loan was essential. On the initiative of Great Britain a conference
between the representatives of the great powers and Turkey was held in
London, and resulted in the signing of a convention in March 1885. The
terms agreed upon in this instrument, known as the London Convention,
were embodied in a khedivial decree, which, with some modification in
detail, remained for twenty years the organic law under which the
finances of Egypt were administered.

Provisions of the London Convention.

The principle of dividing the revenue of the country between the Caisse