Germany finishes paying WWI reparations, ending century of 'guilt'
Few people in Germany noted the country's final $94 million WWI reparations payment on Sunday. Some historians say that's for the best.
(Page 2 of 2)
Paying, a step toward normalization
Following World War II, Germany was again looking for financial support in rebuilding a war-torn nation. As a way of reassuring investors, Chancellor Konrad Adenauer, in a breakthrough 1953 agreement in London, committed the newly created Federal Republic of Germany to resuming the pre-war debt leftover from Versailles.Skip to next paragraph
Subscribe Today to the Monitor
"Germany wanted to prove to the world it was going to be an absolutely reliable creditor. It needed fresh cash, and it could only get fresh cash if it repaid its old debt," says Rombeck-Jaschinksi. "That was the basis for Germany’s ‘Wirtschaftswunder’ [economic miracle]. It was important for the reintegration of Germany into the Western world."
But Chancellor Adenauer also argued that the interest on foreign bonds stretching between 1949 and 1952 should be paid by the entire country – not only Western Germany – which meant those payments should only be paid after Germany was reunited.
By the early 1980s, the debt from the London agreement had been reduced and Germany had repaid its bonds. On Sunday, the German government paid foreign investors $94 million in the 20th and final installment of interest payments on those bonds, though a group of American investors have launched law suits, arguing that they are still owed money in connection with the bonds.
A new Germany
And maybe that's for the best, says Professor Holtfrerich.
"The issue of reparation was so hot politically between the two wars that I think one should keep those old wounds closed, especially in the sake of Franco-German relations," he says. "The lesson drawn was the creation of a unified Europe after World World I that should prevent any other war. I think that the lesson has been drawn."
Rombeck-Jaschinks says that the Versailles Treaty was signed too long ago for most people to remember. But perhaps, she adds, the last "guilt clause" payment can serve as a reminder to Germans of how far their country has come over the past century.
"It’s important for our normalization," she says. "We know that after reunification, we have our full sovereignty. Step by step, we became a state accepted by our neighbors, a democratic state."