Presentation on theme: "Peru The Great Depression. Government Peru had a constitutional republic A constitutional republic limits the governments power over citizens – those."— Presentation transcript:
Government Peru had a constitutional republic A constitutional republic limits the governments power over citizens – those part of the government (i.e- President) must govern according to existing constitutional law
Diversified Economy Peru’s economy was not hit as hard during the depression because of its diversified range of exports Cotton and industrial metals were its leading exports Peru had a rapid recovery as early as 1932
Industries during the Great Depression Exports kept a mainly open economy, didnt put up tariffs on imports. agricultural : cotton, sugar, wool and petroleum mining: silver gold, guano, lead, copper Fishing industry textiles Imports: capital goods and manufacture
Main Trading Partners US Brazil Bolivia Argentina Chile Canada
Social Class Structure -organized into 3 class structures -Upper class (minority): approx only 3% -Middle class: workers that depend on salary and job(60% of pop.) -Lower class: workers and rural people (farmers) -class structure consists with a majority of middle class people.
How hard was Peru hit by the depression? Demands for goods decreased so, less production of capital. Result: internal deflation, fall in value of Latin American Currencies, rise in unemployment Year after WallStreet Crash: government intervened to change economic policies to address crisis.
Government Action Internal deflation>unemployment Set prices and established max. level of production. Result: help economy gain strength Huge range of exports (cotton and new metals…) country began to recover export earning early as 1933. Export sector dominated by foreign companies, so losses during the depression, did not have direct effect on Peru Import Substitution Industrialization: encourage homegrown industries to replace Latin American dependence on foreign manufactured goods. -did not use this policy -instead foccussed on export growth. TradeEngage in bilateral trade agreements with industrialized countries. - There was a change in exports: shifted from cotton, copper and silver to oil during the 20s. Financial Reforms in the 20sResult: creation of central banks and regulatory institutions with clear rules Result: made govn. Intervention in this sector easier than other countries
Peru and the Depression During this time Peru was under the control of President Leguia. However, overthrown and the 1930s were rocked by civil wars for the next 3 years The policies that were developed during the depression as well as Peru’s export sector being dominated by foreign companies did not allow the Depression to affect them as much. Mining and Agriculture sectors, which made up a huge portion of Peru’s economy, were not hit as badly. Result: used to bring around recovery.