I lived in country A for a few years, and made a number of purchases on the iTunes store for that country. I have now moved to country B, and want to start using the iTunes store from country B. If I change the country in my account settings, will I lose all my previous purchases, or will I still be able to re-download my purchases from country A from iCloud?
No, you will not lose your original iTunes purchases (songs, movies, apps, books, magazines, etc).
However, if you use iTunes on Macs or Windows to manage your apps, you'll only be able to download any app update(s) only if you switch your iTunes login (authenticate by typing in the correct password when prompted) to the same country that you purchased the apps.
If you use iPod Touch, iPhone, or iPad installed with the latest iOS 5, you'll be able to download updates from purchases made with different iTunes country ids. Again, you'll need to authenticate by typing in the correct password when prompted. But unlike iOS 4, you won't need to log out before switching iTunes id.
I am happily using two different iTunes id to buy content from different countries.
You will not lose purchases (songs and apps). I know because I switched from the US store to Canada when I moved, and all my songs and past app purchases from the US store are still available in my iTunes app.
BUT... you will lose the ability to re-download them if your computer crashes, etc. (So make sure you back up your iTunes and computer to the cloud on a regular basis. Or sign up for Match.) Also, app updates will not be possible for apps bought via the original store. Hopefully, most of your apps were free downloads.
Think of your Apple ID as a personal passport. Some people have 2 passports, but most don't. To keep 2 Apple IDs (passports) in 2 different countries, you are required to have a bank account or credit card with an address in each country. If you don't want the hassle of maintaining a foreign bank account, it's probably not worth having a second Apple ID.