gth at the
beginning of 1905 of 1002 m., and an extension of about 104 m. to
Pirapora, on the Sao Francisco river. It was formerly known as the "E.
de F. Dom Pedro II.," in honour of the sovereign who encouraged its
construction. The main line has a gauge of 63 in. (1.60 m.) and
affords an outlet for a number of inland metre-gauge lines. The first
two sections of this great railway, which carry it across the coast
range, were opened to traffic in 1858 and 1864. The series of trunk
lines terminating at the port of Santos are owned by private companies
and are formed by the Sao Paulo, Paulista and Mogyana lines, the first
owned by an English company, and the other two by Brazilian companies.
The Mogyana carries the system entirely across the state of Sao Paulo
into the western districts of Minas Geraes. The principal trunk lines
(the Sao Paulo and Paulista) have a broad gauge, while their
extensions and feeders have a narrow gauge. The comparatively short
lines extending inland from the ports of Sao Salvador (Bahia),
Pernambuco, Maceio, Victoria and Paranagua serve only a narrow zone
along the coast. To encourage the investment of private capital in the
construction of railways, the general railway law of 1853 authorized
the national government to grant guarantees of interest on the capital
invested. Under this law companies were organized in England for
building the Sao Paulo railway, and the lines running from Bahia and
Pernambuco toward the Sao Francisco river. Political considerations
also led to the construction of similar lines in the states of Rio
Grande do Norte, Parahyba, Alagoas, Sergipe, Espirito Santo, Parana,
Santa Catharina and Rio Grande do Sul. The result was that the
national treasury became burdened with a heavy annual interest charge,
payable abroad in gold, which did not tend to diminish, and had a long
period to run before the expiration of the contracts. The government
finally determined to take over these guaranteed lines from the
foreign companies owning them, and a statement issued in October 1902
showed that 1335 m. had been acquired at a cost of L14,605,000 in
bonds, the interest on which is L584,200 a year against an aggregate
of L831,750 in interest guarantees which the government had been
paying. In addition to this economy it was calculated that the lines
could be leased for L132,000 a year. The loan finally issued in London