To attract investments by foreign countries
The main advantage that the South had at the beginning of the war was its large army and well-trained generals. The Confederacy, from this perspective, appeared more capable of winning the war at the beginning of the conflict. Moreover, as most of the fighting was carried out in the South, they also had the advantage of knowing the territory.
I do not think that the South failed to exploit its initial advantages. The Confederacy fought extremely well during the early stages of the war. However, the North's advantages were finally just greater. The South relied on agriculture, which was rendered unviable during the war. Moreover, it had a much smaller population, and its workforce was destroyed after emancipation. All of these put the Confederacy in a particularly difficult position.
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