The Great Depression’s magnitude was unprecedented, and its effect rippled well beyond Europe and the United States. Because many countries and colonies in Africa, Asia, and Latin America were nearly totally dependent on one or two commodities for income, the implementation of protectionist trade policies by the leading industrial nations had devastating effects.

The Great Depression hit the vulnerable commodity economies of Latin America especially hard. With foreign sales plummeting, Latin American countries could not buy the industrial goods they needed from abroad. The global depression provoked a profound shift toward economic nationalism after 1930, as popularly based governments worked to reduce foreign influence and gain control of their own economies and natural resources. These efforts were fairly successful. By the late 1940s factories in Argentina, Brazil, and Chile could generally satisfy domestic consumer demand for the products of light industry. But as in Hitler’s Germany, the deteriorating economic conditions in Latin America also gave rise to dictatorships, some of them modeled along European Fascist lines (see “Why did populism emerge as such a powerful political force in Latin America?” in Chapter 31).

The Great Depression marked a decisive turning point in the development of African nationalism. For the first time, educated Africans faced widespread unemployment. African peasants and small business people who had been drawn into world trade, and who sometimes profited from booms, also felt the economic pain, as did urban workers. In some areas the result was unprecedented mass protest.

While Asians were somewhat affected by the Great Depression, the consequences varied greatly by country or colony and were not as serious generally as they were elsewhere. That being said, where the depression did hit, it was often severe. The price of rice fell by two-thirds between 1929 and 1932. Also crippling to the region’s economies was Asia’s heavy dependence on raw material exports. With debts to local moneylenders fixed in value and taxes to colonial governments hardly ever reduced, many Asian peasants in the 1930s struggled under crushing debt and suffered terribly.

When the Great Depression reached China in the early 1930s, it hit the rural economy the hardest. China’s economy depended heavily on cash-crop exports and these declined dramatically, while cheap foreign agricultural goods — such as rice and wheat — were dumped in China. Agricultural prices in 1932 were only 41 percent of 1921 prices, and rural incomes fell by over 50 percent between 1931 and 1934. While Chinese industrial production dropped off after 1931, it quickly recovered. Much of this growth was in the military sector, as China tried to catch up with the West and also prepare for war with Japan.

In Japan the terrible suffering caused by the Great Depression caused ultranationalists and militarists to call for less dependence on global markets and the expansion of a self-sufficient empire. Such expansion began in 1931 when Japan invaded Chinese Manchuria, which became a major source of the raw materials needed to feed Japanese industrial growth (see Chapter 29). Japan recovered more quickly from the Great Depression than any other major industrial power because of prompt action by the civilian democratic government, but the government and large corporations continued to be blamed for the economic downturn. By the mid-1930s this lack of confidence, combined with the collapsing international economic order, Europe’s and America’s increasingly isolationist and protectionist policies, and a growing admiration for Nazi Germany and its authoritarian, militaristic model of government, had led the Japanese military to topple the civilian authorities and dictate Japan’s future.