Why did the UK lose its status as a world power after the Second World War? The two World Wars had a tremendous impact on the British economy. Similarly but worse than the World War l, Britain experienced a huge loss of her wealth after the Second World war (1939‐1945). The extinction of British Empire mainly started with the outbreak of the Second World War. As a result her status as a world power weakened. There are many various factors that affected Britain so that she lost economic and political power to an extent that she became almost bankrupt and only escaped the situation of insolvency in 1946 after the US offered a loan of a $3.5 billion (Brown, 1988). and the last payment was made only in 2006 (http://news.bbc.co.uk). There are several issues that have strong connection with the decline of Britain in the post-war period(1945‐1960): hard hit industry; decolonisation; government’ s policies regarding modernisation and science; deconolisation and the subsequent economic impact, all of which will be discussed in this essay.
Firstly Britain was severely damaged over the period although she won the war. She was not in war as long as France, Germany or Russia was but many industrial facilities were destroyed to a great extent because of Battle of Britain many industrial facilities were destroyed. Also, the national defense system against war that Churchil implemented from the beginning of war was needed for war but brought decline in economy. Britain could have compensated for the losses and damages as a war winner by charging war reparations on defeated countries or plundering her colonies if it were after the First World War. However, this was not possible after the Second World War because her enemy country Germany did not have colonies to get benefit from, most of the industrial facilities were destroyed due to the intensive attacks by British air force and the country was divided into two after the war, all of which left Germany incapable to pay...
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