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Marshall Plan

Known officially following its enactment as the European Recovery Program, the Marshall Plan was a United States plan for reconstruction of Europe after World War II. The initiative is named after secretary of state Gen. George Marshall, who in a speech at Harvard University (5 June 1947) outlined the U.S. government's preparedness to contribute to European recovery. President Harry Truman signed the Marshall Plan into law on April 3, 1948.

Between 1948 and 1951, the United States contributed more than thirteen billion dollars (nearly $100bn at present-day U.S. prices) of economic and technical assistance toward the recovery of 16 European countries which had joined (16 April 1948) in the Organisation for European Economic Co-operation (OEEC, forerunner to today's OECD) in response to Marshall's call for a joint scheme.

The plan was rejected by the Soviet Union and its eastern European satellite countries owing to U.S. insistence on economic liberalisation and pan-European co-ordination of recovery efforts, but gave impetus to the formation in the west of the North Atlantic Treaty Organization and to the European Economic Community.

The Marshall Plan has often been cited as an example of how massive economic assistance can produce prosperity. However, some have pointed out that post-war reconstruction of Europe was a far easier problem than the development or reconstruction of areas in today's Third World. In the case of Europe, despite being devastated by war, there was still significant physical infrastructure along with technical skill in the population. In the case of the Third World, the infrastructure and technical skills do not exist to the same extent.

Critics of the Marshall Plan's claim to a decisive role in Europe's recovery point out that growth in many European countries revived before the large-scale arrival of U.S. aid, and was fastest among some of the lesser recipients. While Marshall aid eased immediate difficulties and contributed to the recovery of some key sectors, growth from the post-war nadir was largely an independent process. European socialists argue that a similar amount of reconstruction money could have been obtained by nationalizing the holdings of wealthy Europeans who deposited their money in US banks during World War II.

Marshall Plan Expenditures

Economic Assistance, April 3, 1948 to June 30, 1952 (in millions of dollars)

COUNTRY Total Grants Loans
Total for all countries $13,325.8 $11,820.7 $1,505.1
Austria 677.8 677.8 --
Belgium-Luxembourg 559.3 491.3 68.0a
Denmark 273.0 239.7 33.3
France 2,713.6 2,488.0 225.6
Germany, Federal Republic of 1,390.6 1,173.7 216.9b
Greece 706.7 706.7 --
Iceland 29.3 24.0 5.3
Ireland 147.5 19.3 128.2
Italy (including Trieste) 1,508.8 1,413.2 95.6
Netherlands (*East Indies)c 1,083.5 916.8 166.7
Norway 255.3 216.1 39.2
Portugal 51.2 15.1 36.1
Sweden 107.3 86.9 20.4
Turkey 225.1 140.1 85.0
United Kingdom 3,189.8 2,805.0 384.8
Regional 407.0d 407.0d --


  • a. Loan total includes $65.0 million for Belgium and $3.0 million for Luxembourg: grant detail between the two countries cannot be identified.
  • b. Includes an original loan figure of $16.9 million, plus $200.0 million representing a pro-rated share of grants converted to loans under an agreement signed February 27, 1953.
  • c. Marshall Plan aid to the Netherlands East Indies (now Indonesia) was extended through the Netherlands prior to transfer of sovereignty on December 30, 1949. The aid totals for the Netherlands East Indies are as follows:
    Total $101.4 million, Grants $84.2 million, Loans $17.2 million.
  • d. Includes U.S. contribution to the European Payments Union (EPU) capital fund, $361.4 million; General Freight Account, $33.5 million; and European Technical Assistance Authorizations (multi-country or regional), $12.1 million.


Statistics & Reports Division
Agency for International Development
November 17, 1975

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