Section Three-Trade and Commerce Between the Wars

Question 1

What happened to British policy towards imperial trade during the inter-war period?

Answer 1

Two distinct phases occurred:

1) -In the 1920s, Britain tried to recreate the economic system which had existed before 1914. Britain returned to the gold standard in 1925
2) -In aftermath of Great Depression, much greater emphasis was placed on importance of Empire for British commerce and imports from Empire increased; Britain forced to abandon gold standard in 1931

Question 2

How did Britain soften the impact of the damaging effects of the collapse of the international economy due to the Great Depression?

Answer 2

Most countries of Empire fixed the value of their currencies to sterling and some kept their national reserves in sterling- this gave access to British market for countries in Sterling Area, while ensuring profitable outlet for British overseas investment