What problems did Great Britain’s postwar economy have?

1 answer:

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The economy of Great Britain was greatly damaged during World War II. During the war, the economy was modified in order to operate solely for the purposes of war. Therefore, postwar economy needed to be carefully rebuilt in order to satisfy the needs of peaceful Great Britain.

One of the first problems the country faced after the war was a harsh winter coupled with shortages of coal in 1946-1947. This meant that the economy did not significantly improve during this period. Another problem was the fact that there was a run on Sterling, as pounds were traded for dollars. This led to the devaluation of the British pound. In order to encourage trade, products were prioritized for exportation, which meant that rationing was extended in some way or another until 1954. Although the United States contributed with aid in order to encourage business, the money was mostly used to repay British debts, which made the modernization of the economy much slower than in other areas of Europe.

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