British dependence on German imports. Responses to the challenges of the World War I

Abstract

The COVID-19 pandemic has become a litmus test for both the resilience of economic systems and the ability of governments to ensure the national economies’ efficiency and security in an emergency. In 2020, EU political leaders recognized the dependency of health care and pharmaceutical production on imports of medicines (drugs), active pharmaceutical ingredients and intermediate goods from China. This is rather a next historical cycle of the situation that occurred 100 years ago – something worthy of attention when looking for answers to modern challenges. In 1914, the UK, as well as some other industrialized countries of Europe and the United States, was shocked to learn about being dangerously dependent on German imports, including synthetic drugs and chemical intermediates. The State, universities and companies joined forces to reduce the vulnerability of the industry and to address external threats. The purpose of the study is to draw on legislation, historical documents and publications in specialized publications to describe the state of the British pharmaceutical industry at the beginning of the World War I; to identify the causes of its dependence on imports; to summarize the policies adopted in response to the new challenges and assess their impact on industry and the economy as a whole. Based on the British experience, a historical and economic rationale was made for the relationship between public assistance mechanisms (in terms of building human resources and intensifying research for industry, providing public financial assistance to industrial enterprises and protecting key industries from imports) and accelerated modernization and development of a self-sustaining pharmaceutical industry. The author systematized policy measures and argued that their implementation had strengthened British companies, reduced dependence on imports, and increased the production of medicines and their components, based on national innovation.