THE INTERWAR PERIOD HIST 1301 | History
Postwar Recession and Prosperity
The international economy was decimated by international War I. The labour force in Europe
had been disturbed by four long years of fighting and losses, not to mention the
governments' fiscal projections. Britain and France intended to pay off their own debts
through the reparations that Germany owed, but doing so also built an unstable economic
house of cards. The war's economic repercussions were also felt in South America, Asia, and
Africa. Prior to the war, Germany constituted the majority of European commerce with subSaharan Africa, and African countries had engaged in considerable trade with Europe. Due to
the difficulty of trade with the warring states, many European commodities increased in price
once the conflict started, making them unaffordable for many Africans. In order to survive
financially after the war, Britain and France turned to their colonies in Africa as well as
Germany's former colonial holdings. Britain and France both prioritised the advancement of
agriculture. This sometimes meant giving White settlers more chances to benefit both
themselves and their own nation while giving Black Africans less possibilities. French officials
promoted coffee exports in the part of Cameroon they were allocated to manage following
the war. However, they also limited the amount of land that Black Africans could farm and
granted licences to produce the crop mostly to Europeans. White coffee producers had a
ready supply of agricultural labourers who were compelled to accept low salaries because
Black people lacked opportunities. Likewise, in British Tanganyika (modern-day Tanzania),
Europeans only had the authority to harvest and sell wood. Following the war, Britain and
France made significant investments in the construction of railroads throughout Africa, and
Britain also lavished money on mining ventures in South Africa, Nigeria, and the Gold Coast
(Ghana). The war also had an impact on East Asian nations, and once it ended, the economy
of some of them—including China and Japan—saw expansion. China profited from the decline
in worldwide rivalry brought on by Europe's economic problems even though it had not yet
undergone significant industrialization. The Japanese economy was battered by booms and
recessions, inflation, the Great Kanto Earthquake of 1923, and a major financial crisis in 1927
during the Taisho period in the 1920s. Japan's urban economy was now being threatened by
protectionism, which was implemented by both the American and European markets in the
form of import taxes, since the country had grown largely dependent on trade with the
United States. Nonetheless, when the nation started to invest in China and boosted military
manufacturing, Japan's economy grew even more in the 1920s. Although there was inflation,
the government countered it with austerity measures. After the war, Japan was able to boost
its exports even more than China did, and commerce rose significantly with the US in
particular. After the conflict, the economies of the countries in Latin America barely changed
at all. Many still relied heavily on agricultural exports to fuel their economies and had few
industry. As more and more parts of the world started to export goods like rubber, some
faced increased rivalry for these commodities. Oil was one Latin American product that did
see increase, especially in Venezuela, since it was becoming more and more significant in
international markets. South America's highly industrialised nations, including Brazil, Peru, and Argentina, offered steady but modest economic development. They focused their
production on the export market, but during the 1920s, domestic monetary policy shifts and
tariff rates kept them back. Unlike the other Allies, the United States did not experience the
physical destruction of war. It came out of the war as an economic force to be reckoned with,
a country that owed Britain and France money for loans made during the war. As a result, the
1920s were a prosperous decade for the nation, with the perception of opulence being
increased by technical advancements. Large shops were prepared to provide new products
to customers via credit lines that they would eventually pay off, such as refrigerators, electric
stoves and hoover cleaners. Wages rose, unemployment was low, and domestic life became
much simpler. For Americans, the future appeared promising.
Postwar Recession and Prosperity
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