On June 28, 1919, a £22 Billion reparation were set by the Allies – Britain, France and America – at the Treaty of Versailles as compensation and punishment for the 1914-18 war. After 92 long years Germany was finally clear of their debt and had paid of the final portion of the reparation on October 3rd 2010.

This large amount of reparation had taken an extremely long time to repay for several reasons. Firstly, Germany themselves had suffered financial crisis, hyperinflation, cancelled debts and broken promises. Germany had struggled to keep its economy high. The Treaty of Versailles had already taken so much from them, that it made it harder to repay. The German currency was extremely useless at one point in time and wheelbarrows of cash were need to buy a loaf of bread. Money was printed for absolutely everything, therefore devaluing their currency. Germany had also stopped paying their debts several times that other countries had to force them to do so. Furthermore, when the rise of the Nazi Party came along, all reparations was cancelled by Germany. Hitler reneged on reparations during his reign. Another reason why the payment rook so long was that Germany was split into East and West and a conflict about which side repays what came about.

The initial sum agreed upon for war damages in 1919 was 226billion Reichsmarks, a sum later reduced to 132billion.

It was obvious Germany didn’t agree with the terms set by the Treaty of Versailles. It angered them to sign the treaty and go through rough repayments. By paying all their depts and having a great burden lifted of their shoulders, it is sure that Germany was in relief and under less pressure.

Most of the money Germany had to repay was intended to go to Belgium and France, whose land, towns and villages were devastated by the war, and to pay the Allies some of the costs of waging it. Most of the money paid went to private individuals, pension funds and corporations holding debenture bonds as agreed under the Treaty of Versailles. The original purpose was to rebuild the French cities, but after 92 years, this purpose definitely would have changed. France’s cities were rebuilt long before Germany’s final repayment. The money now would be used in different ways.


1 Comment (+add yours?)

  1. ross4eva
    Dec 13, 2014 @ 17:48:29

    it was helpful. Keep it up! 🙂


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