How Did Ww1 Affect The Canadian Economy

5. World Economy Canadian Economy

World War One The economic costs of war were high since many European cities, towns, farms, ports, railways, roads, ships, and factories had been destroyed. Many European governments had borrowed a lot of money from the U.S., and so by 1918 they owed more than $7 billion (U.S.) to the United States. Their economies were devastated. In 1919, world production of manufactured goods plummeted by 25%, and in Russia, production had dropped by 80%. After the war, man countries restricted international trade while they tried to rebuild. By 1918, WWI was costing the Canadian government more than $2.5 million dollars a day and income taxes had been temporarily introduced to help pay the costs. After the war, interest

Many delegates were opposed to this, however it happened anyway. The harsh conditions led to WWII, the very thing the treaty was supposed to prevent. As the world engaged in war, its economy plummeted and faced both short and long-term effects. The Treaty of Versailles, which was signed after World War I, was supposed to ensure peace by imposing harsh conditions on Germany in the form of reparations. Canadian, American, and other delegates warned that the reparations were too severe. In the end, the Treaty ended up crippling Germany and Austria with war debts that guaranteed another war: World War II. Although the Treaty of Versailles, in itself, did not impact Canadian economy that much, World War II

To try to pay its reparations, the German government printed huge amounts of money. Subsequently, marks -- German currency -- became almost worthless. A loaf of bread which used to cost 2 marks in 1918, became worth six million marks in 1924. People struggled to survive and more than 60 million people, both military and civilian, died. The war had short- and long-term affects on the Canadian economy. During the war, government spending increased and the manufacturing of arms, airplanes, and ships rose. Farming became more mechanized and unemployment fell. More than a million women joined the workforce, many for the first time. From 1939 to 1941, employment in Canada’s manufacturing sector rose by 50% and by the end of the war, less than 1% of Canadians were