chapter  9
The ‘colonial question’ and towards colonial reform, 1930–40
Pages 19

The commercial and financial collapse which overwhelmed the British economy in 1930 and 1931 led to two major breaks with past economic policy. In September 1931 a massive haemorrhage of the Bank of England’s gold and foreign exchange reserves caused the gold standard to be jettisoned and the pound to float: within three months it had lost 31 per cent of its gold value. In February 1932, the policy of free trade, which had been the cornerstone of British international commercial practice for at least 70 years, was abandoned as the new National government introduced a general 10 per cent import levy. The end of free trade meant that the government was at long last in a position to introduce a system of imperial tariff preference. The imperial economic conference, scheduled for Ottawa in July, was the venue for implementation of the long-held dream of the ‘imperial visionaries’ of an empire trade bloc.1