Devlog #5 - Debts & Loans

Hello everyone!

Welcome to this fifth Devlog of Fields of History: The Great War. Today we will speak about Debts and Loans.

In our last Devlog about the Industrial Production, we talked about Wealth production. You should know that in FoH, you can borrow money to invest quickly or provide loans to other countries to earn Interests.

We have developed this system of loans to mimic the indebtedness of States. In the course of History, debts had a major influence over the destiny of many nations.

For example, at the end of the 19th century, the Ottoman Empire was so indebted that it had to accept the creation of the OPDA (Ottoman Public Debt Administration). This establishment, although officially independent in its operation, was in fact in the European banks hands.

It was the same for the critical economic situation of the Russian Empire in the early 20th century. During years, Russia had been forced to accumulate loans in order to modernize its infrastructures, pay its old debts and restore its finances after its debacle during the Russo-Japanese War.
After the Bolsheviks came to power in 1917, the Russian debt, which was largely held by Europeans (mostly French and British), was unilaterally repudiated on 29 December 1917 by a decree of the Russian Soviet Republic.

Thanks to our loan system, we can reproduce similar situations in FoH, whether historical or not.

In FoH, if you have accumulated Debts (by taking out loans with another country or issued government bonds) you will have to pay Interests each day. These will lower your Wealth production. The Sovereign Debt of a country is obtained by accumulating its Domestic Debt and its Foreign Debt.

The Domestic Debt is composed of:

  • War Bond - Government Bond with a term of 1 to 2 years at an average interest rate (only available during war)
  • Treasury Bill - Government Bond with a term of 1 year and a high interest rate
  • Treasury Note - Government Bond with a term of 2 to 10 years at an average interest rate
  • Treasury Bond - Government Bond with a term of more than 10 years with a low interest rate

The Foreign Debt is composed of:

  • Loan (Taken) - Loan you have taken out with another country
  • Loan (Given) - Loan you have granted to another country

From the Diplomatic Menu, you can either Offer a Loan or Ask for one. Of course, in case of war, it will be impossible to Negotiate a Loan with an enemy country.

In a Loan Negotiation, several criteria come into play. The borrowing and repayment capacities (calculated from the Sovereign Debt and the Industrial Power), the diplomatic relationship between the countries, the geopolitical situation (alliance, war, embargo, etc.).

The amount, duration and rate of a Loan (whether Taken or Given) may vary depending on the situation.

We have worked to ensure that our Artificial Intelligence can adapt during negotiations. It's not because you have good relations with a Nation that it will necessarily accept your offers and requests.

Throughout a Negotiation, you will know the opinion of your Diplomats (via a textual summary) who will estimate the chances of success. You will have to be clever and make reasonable proposals if you want to get an agreement.

However, a country can change its mind over time. No proposal is 100% sure and you will have to choose the right timing to negotiate.

Borrowing can be very useful when you need important liquidity (financing a new army, structural investment, purchase of resources, etc.) but be careful, even if it may seem attractive at first, be sure to not enter in and indebtedness spiral that could quickly ruin your country.

In extreme cases (like War), you can ask your Allies to suspend Debts Repayments you have with them and they can also ask for the same from you.
It will be up to you if you prefer to relieve an Ally so that it can fully engage in the War or stick to a cold collection of interests to increase your cash flow.

You will also have the opportunity to renegotiate your loans with a country if it's in a favorable situation (solid finances and good relations).

Of course, a nation that becomes your enemy will immediately suspend its repayments but have no fear, you can assert your rights if you force your enemy to sign a Peace Treaty and claim your due.

That's all for today, before closing this Devlog, we warmly thank the french magazine Guerres & Histoire for putting forward our game in their February edition!

We hope you liked this Devlog, we wish you a good week and see you soon!

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