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Economic Effects of the Peace Treaties on Europe

$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$. Economic Effects of the Peace Treaties on Europe. $ Europe as a whole. Low levels of production Food shortages Raw material shortages (b/c these came from colonies) Large debts Rising inflation International trade diminished

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Economic Effects of the Peace Treaties on Europe

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  1. $$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$ Economic Effects of the Peace Treaties on Europe

  2. $ Europe as a whole • Low levels of production • Food shortages • Raw material shortages (b/c these came from colonies) • Large debts • Rising inflation • International trade diminished • Industry failing because of total war (all production was for war causes)

  3. Russia • War & civil war caused economic crisis; communist takeover of industry/end of private ownership did not stimulate economy • Agricultural situation was worse—gov’t took grain from farms to feed soldiers, left peasants starving & unpaid

  4. Germany • Lost US and Britain as trade partners; blockade • Lost colonies & their raw materials • Financed WWI by borrowing money, then double blow of paying that back + reparations • Needed US loans to grow economy back • Inflation…

  5. A loaf of bread in 1918 cost: .63 marks

  6. A loaf of bread in 1922 cost: 163 marks

  7. A loaf of bread in 1923 cost: 201,000,000,000 marks

  8. The Successor States • Experienced similar difficulties, undeveloped agriculture and industry • Tariffs (taxes on trade) were used heavily by the US and the successor states to cause imported items to cost too much

  9. Yugoslavia • Kingdom of Serbs, Croats, and Slovenes • Serbia had been at war since the Balkan war of 1912 • Economy almost entirely based on agriculture • New borders made trade more difficult • Yugoslav economy made a brief recovery until 1929 when world food prices dropped and they saw widespread unemployment

  10. Czechoslovakia • Contained a large supply of raw materials—coal and iron ore • Gained much of the former industrial area of Austria-Hungary • By 1923 production levels were much higher than those in the same places before war • Great Depression/1929 when overseas trade ended, Czech economy suffered

  11. Poland • Eastern Poland was farmland, people were hit hard by the Great Depression like everyone else • Western Poland (taken from Germany) experienced major inflation; government slashed spending, froze wages, increased taxes; decreased standard of living in Poland • Some industry growth in the north because of coal

  12. Austria • Hyperinflation like Germany (currency fell to 1/15 it’s normal rate) • Economy was saved by large LoN loans • Wages cut, resulting in lower standard of living • Political extremism grew as people became dissatisfied with their government • End of decade agricultural improvements, development of hydroelectric power

  13. Hungary • Treaty of Trianon’s borders created loss of raw materials and lines of communication • 1921-23 economic loss, but received a LoN loan • New industries were built, mines opened • New employment came with this • Like Germany, recovery was based on foreign loans (which would end with the Great Depression)

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