There’s a really good book called “Blue and Gray Diplomacy” by Howard Jones that really goes into a lot of depth on this subject. It’s definitely worth checking out.

For starters, the Confederacy knew the North was industrially and technologically superior well before the war even broke out. They knew the North was more advanced. However, they were convinced that the fighting wouldn’t last more than a couple of months before the North gave into the South’s demands. They had no idea that the war would last as long as it did, and were completely unaware that the war would get to the point where they had to worry about their production capabilities versus the north’s. Additionally, the South thought that France and Britain would quickly join on the side of the Confederacy. They were actually almost right, as Britain came very close to doing so at one point. With the help of France and Britain, the Confederacy knew that the Union alone wouldn’t stand a chance against two of them combined, let alone three. And that’s what they were hoping for when the war began.

As for the second part, the Confederacy actually did put forth a ton of effort in trying to get Britain and France to ally themselves with the south. And it almost worked too. However, France was weak and Britain did not want to get involved in yet another low-benefit and costly war in North America after Lincoln threatened war if Britain were to intervene.

Hope that answers your question!