3.1.2
Economic Loans, 1924-1928
Stresemann and the Dawes Plan
Stresemann and the Dawes Plan
Gustav Stresemann was German chancellor from 1923 to 1924 and later became the Foreign Minister. He helped improve the German economy through ending hyperinflation and negotiating deals to help Germany pay reparations.
Stabilising the currency
Stabilising the currency
- The interim Rentenmark, which Stresemann had introduced to deal with hyperinflation, was replaced by the Reichsmark in 1924. Inflation was controlled by limiting the money supply and keeping interest rates quite high.
The Dawes Plan
The Dawes Plan
- As foreign minister, Stresemann negotiated a financial deal with Charles Dawes from the United States of America.
- Reparations would be 1,000 million marks, after five years it would rise the 2,500 million, and then at a varying levels according to Germany’s economic performance.
- The allies maintained control of the railways, the Reichsbank and customs duties.
- Germany was given an 800 million mark loan from the American banks to help stabilise the currency after the hyperinflation of 1923.
Domestic hostility to the Dawes Plan
Domestic hostility to the Dawes Plan
- The German right wing were against war guilt and reparations. From their point of view, the Dawes Plan achieved nothing.
Other economic agreements
Other economic agreements
- The German economy was also being helped by international economic agreements. These included:
- Franco-German agreements on potash and aluminium.
- European cooperation on raw materials production.
Reparations and the Young Plan
Reparations and the Young Plan
The Young Plan, written in 1929 and adopted in 1930, reduced the amount of reparations Germany had to pay to the Allies.
Motive behind the Young Plan
Motive behind the Young Plan
- It became apparent that Germany was unwilling to pay the amount of reparations laid out in the Treaty of Versailles.
- Whilst the Dawes Plan had helped Germany, it was not a permanent solution.
Terms of the Young Plan
Terms of the Young Plan
- The Young Plan reduced the amount of reparations by 20%.
- In theory, the reparations would continue until 1988.
The Wall Street Crash
The Wall Street Crash
- But the Young Plan could not come to fruition because of the Wall Street Crash in 1929.
- This meant that the money which supported the plan was recalled.
1Political & Governmental Change, 1918-1989
1.1Creation & Collapse of Weimar, 1918-1932
1.2Nazi Dictatorship, 1933-1945
1.3Return to Democratic Government, 1945-1989
2Opposition, Control & Consent 1918-1989
2.1Opposition to Government, 1918-1989
2.2Controlling the People, 1918-1989
3Economic Developments & Policies, 1918-1989
3.1Reacting to Economic Challenges, 1918-1932
3.2Controlling the Economy, 1933-1945
3.3Creating the Social Market Economy, 1945-1989
4Aspects of Life, 1918-1989
4.1Attitudes Towards Women, 1918-1989
4.2Education & Cultural Developments, 1918-1989
5Historical Interpretations
5.1Influence of German History
5.2Hitler & Foreign Policy
5.3Contribution of Other Nations to WW2
5.4Reasons for Invading Poland
Jump to other topics
1Political & Governmental Change, 1918-1989
1.1Creation & Collapse of Weimar, 1918-1932
1.2Nazi Dictatorship, 1933-1945
1.3Return to Democratic Government, 1945-1989
2Opposition, Control & Consent 1918-1989
2.1Opposition to Government, 1918-1989
2.2Controlling the People, 1918-1989
3Economic Developments & Policies, 1918-1989
3.1Reacting to Economic Challenges, 1918-1932
3.2Controlling the Economy, 1933-1945
3.3Creating the Social Market Economy, 1945-1989
4Aspects of Life, 1918-1989
4.1Attitudes Towards Women, 1918-1989
4.2Education & Cultural Developments, 1918-1989
5Historical Interpretations
5.1Influence of German History
5.2Hitler & Foreign Policy
5.3Contribution of Other Nations to WW2
5.4Reasons for Invading Poland
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