Coming from a geopolitical and socioeconomic perspective, the end of WWII marked a new of an new era in which the international community showed great resolve to work together in restoring the international economy. This is evident through international institutions that developed within the period 1944 to 1947 with broad goals of reconstruction in Europe, elimination of barriers to trade, and exchange rate stability. These initiatives had varying numbers of success, but were all effective in an outstanding regard: instilling overarching faith and reliance out there system.
Negotiations between Britain as well as the U.S. were beginning in the war. The immediate result was the Mutual Aid Agreement in 1941, which handled lend-loan agreements plus an exchange of ideas for collaborating among nations when peace was restored to rebuild a correctly functioning economy.
In April 1944, delegates from 44 nations met to draw in economic policies to meet this goal in Bretton Woods, NH. Two international institutions were developed, therefore: the International Monetary Fund (IMF) as well as the International Bank for Reconstruction and Development (IBRD) - the World Trade Organization (WTO).
The purpose of this meeting of delegates with the world's leading economies back then ended up being provide stable monetary policy by fixing the forex rates of member nations when it comes to either gold or dollars. Additionally, it sought to supply loans for reconstruction in Europe and, later, for economic growth initiatives in developing countries. In doing this, a monetary standard was created that today is historically referred to as the "Bretton Woods System."
Two other international institutions were developed in 1947 to stimulate world trade and investment: the Agreement on Tariffs and Trade (GATT) and the European Recovery Aid (ERA). Twenty-three nations met in Geneva, Switzerland to devise GATT - now the World Trade Organization by 1995 - and negotiated the reduction of tariffs on over 45,000 items, which represented nearly 50% of world trade. In 1949, GATT had 34 members, representing 80% of world trade. Inroads were designed to move nearer to a no cost trade system through the reinforcement in the Most-Favored Nation (MFN) clause, first seen beneath the Gold Standard from the late Nineteenth century.
A powerful resolve from the international community as well as the formation of international institutions to compliment market processes played an important role within this recovery from WWII. However, policymakers did not foresee the dollar gap that happened in the mid-1940s, due to the running of trade surpluses with the U.S. along with the resulting difficulty for Europe to export its goods, in addition to challenges in coming up with the dollars to buy U.S. imports.
The IMF was essentially useless in its first few years as the economic crisis in individual nations prevented this supranational organization from fixing forex rates within specific par values towards the dollar or gold. Nonetheless, one modest success was its role in allowing 19 countries in Europe to devalue their currency in 1949 by approximately 30% to bring back their balance of trade and improve its international competitiveness.
The achievements GATT was limited, as well. After 1949, there have been no further meetings for one more 5yrs due mostly to disagreements with the U.S. stemming in the proven fact that Europe was allegedly reaping substantially numerous advantages from trade agreements.
Economic reconstruction occurred rapidly in Europe following WWII and led toe the Golden Age era in Europe. This remarkable time period of rapid growth and productivity is attributable, simply, towards the formation of international institutions that devoted to stable monetary and trade policy. High numbers of investment, full employment, and low inflation as a result of Keynesian policies drilled into these supranational institutions also played a predominant role in the economic recovery. Technological spill-overs from trade boosted labor productivity and, hence, real incomes throughout Western Europe.
Although the catch-up period was generally an Eu phenomenon and significant elements of Eastern Europe was under Soviet rule, the condition of the international economy after WWII ended was good overall. Japan had approximately 8% real GDP growth and Africa, 2.5%. Worth noting is usually the fact the IMF, the IBRD (World Bank), and GATT (WTO) all carry on and play an important role in economic development today.
Author Resource:
Mark Vaccaro researches and writes extensively on the best practices in online marketing. Some articles that I recommend reading can be found on the topics of general interest and choosing home tuition .
![[Valid RSS feed]](http://www.look4articles.com/images/icon_Rss.png "XML Feed For RSS"){kind=icon}
Category Rss Feed
Print This Article
Add To Favorites
![[Valid RSS feed]](http://www.look4articles.com/images/rss.jpg "XML Feed For RSS")