Section 4: The Winds of Change 1947-67 Chapter 21: Trade and Commerce
Chapter 21: Trade and Commerce
How Important was the Empire/ Commonwealth to the Post-War Reconstruction of
Britain?
Statistics
Rest of the world 717 34.6 927 27.5 2009 43.2 2281 39.6
Rest of the World 475 29.1 646 24 1427 37.7 1939 39.6
• Trade outside the commonwealth and outside Western Europe was very important – as it always had been
• Europe was of growing importance to Britain
• Britain had had to sell its overseas investments overseas and lost income from its invisibles which used to make up the
trade deficit
Background
• 1947 – devaluation of the pound – made exports cheaper (encourages exports), however, it reduced investment
• Try to develop their colonies with the CDaWAs
In what ways did the USA rise to global economic predominance after WW2?
• The world was dominated economically by the USA – only nation that wasn’t damaged economically by the war. Lots of
nations had borrowed from the USA – came out as the world’s creditors
• Dollars become the main currency
• The US Marshall plan of 1948-52 provided Britain with $3.3bn
How did Britain attempt to meet the challenge to pay for vital imports in the post-war period?
• In order to buy vitally needed goods, Britain needed to earn dollars and build up foreign exchange reserves with which to
pay for imports
• It counited rationing at home to reduce food imports and prioritised British industrial production for the export rather
than the domestic market
• They also tried to develop the productive and export capacities of the colonies, particularly in Africa, where the relative
under-development of local resources offered huge opportunities for growth
Why was trade with the Empire and Commonwealth important up to the 1960?
• Areas like Malaya were a major contributor to the Hard Currency Pool (Hard Currency Pool – having to keep some
reserves in another currency so you trade with other nations)
Chapter 21: Trade and Commerce
How Important was the Empire/ Commonwealth to the Post-War Reconstruction of
Britain?
Statistics
Rest of the world 717 34.6 927 27.5 2009 43.2 2281 39.6
Rest of the World 475 29.1 646 24 1427 37.7 1939 39.6
• Trade outside the commonwealth and outside Western Europe was very important – as it always had been
• Europe was of growing importance to Britain
• Britain had had to sell its overseas investments overseas and lost income from its invisibles which used to make up the
trade deficit
Background
• 1947 – devaluation of the pound – made exports cheaper (encourages exports), however, it reduced investment
• Try to develop their colonies with the CDaWAs
In what ways did the USA rise to global economic predominance after WW2?
• The world was dominated economically by the USA – only nation that wasn’t damaged economically by the war. Lots of
nations had borrowed from the USA – came out as the world’s creditors
• Dollars become the main currency
• The US Marshall plan of 1948-52 provided Britain with $3.3bn
How did Britain attempt to meet the challenge to pay for vital imports in the post-war period?
• In order to buy vitally needed goods, Britain needed to earn dollars and build up foreign exchange reserves with which to
pay for imports
• It counited rationing at home to reduce food imports and prioritised British industrial production for the export rather
than the domestic market
• They also tried to develop the productive and export capacities of the colonies, particularly in Africa, where the relative
under-development of local resources offered huge opportunities for growth
Why was trade with the Empire and Commonwealth important up to the 1960?
• Areas like Malaya were a major contributor to the Hard Currency Pool (Hard Currency Pool – having to keep some
reserves in another currency so you trade with other nations)
