Examine the economic impact of the Cold War on two countries, each chosen from a different region.

The question requires that candidates examine the interrelationship between the Cold War and the economy of two countries, each chosen from a different region. Candidates may focus upon the impact of the Cold War upon the economies of US, the USSR and/or China and so consider the cost of the arms race; the need to provide aid to countries within their sphere of influence; and the cost of financial or military aid provided when proxy wars were being fought. For countries within the orbit of the superpowers, candidates may consider trade agreements; loans or investment in industrialization or infrastructure; pressure to adopt central planning or a free market system; and the pressure to increase expenditure on arms. Examples may include the economic impact on Cuba of aid from the USSR, as well as its withdrawal; or the economic dependence, both positive and negative, of many Latin American countries on the US. Candidates may consider both the advantages and the disadvantages of being within the economic sphere of a superpower. Candidates’ opinions and conclusions will be presented clearly and supported by appropriate evidence.

The question required that candidates examine the interrelationship between the Cold War and the economy of two countries, each chosen from a different region. This was another popular question although few candidates answered it well. Germany was a popular choice, although many responses failed to distinguish Germany from Berlin and, following 1949, to mention the emergence of the FRG and GDR. There were some quite good responses that chose to examine the Cuban economy although the scope of knowledge was often limited to embargoes imposed by the US and aid provided by the USSR. Candidates who chose the US and the USSR as examples mostly ignored the domestic economies, which were the focus of the question, describing, instead, how the two superpowers impacted the economies of other countries through initiatives such as the Marshall Plan and COMECON.