Hall of Doh!

[lch]

Sombre said:
There are plenty of magic using mercs though.

That Starspawn guy might be the only usable merc in the case described. Otherwise it's a bit of a chicken and-egg-problem: You'll need to outfit a mage with underwater breathing items to build a laboratory underwater. For that, you'll need a laboratory and research and the right magic paths. So your aquatic nation has to learn how to get mages with lungs real quick if they want to see any magic.