The Recovery of Germany

  • Created by: iamme
  • Created on: 03-06-16 22:30

Paper 1 : Development of dictatorship : Germany , 1918-1945

The recovery of Germany, 1924-1929

  • Work of Stresemann
  • Rentenmark, Dawes and Young plan, US loans, Recovery of German economy


  • Temporary German currency established by Stresemann to tackle the hyperinflation.
  • He abolished the old mark.
  • This new currency is regulated by the central bank.
  • Rentenmark was trusted by the people as they were given insurance that if the Rentenmark failed, the Government promised to exchange them for shares in German industry.
  • Results :
    • Germany became stable.
    • Confidence in German currency was restored.
  • By August 1924, Stresemann was able to replace the temporary Rentenmark with a permanent currency called the Reichsmark.
  • The Reichsmark would be controlled by the Reichsbank.
  • Confidence in currency and banking system rose as number of deposits into the bank increased.

Dawes Plan (U.S. Loans) (1924)

  • Reparation costs were too high for Germany to pay.
  • As a solution, Stresemann and Allies agreed on the Dawes Plan.
  • The terms of Dawes Plan:
    • Annual payments were reduced to an affordable level.
    • American banks agreed to invest 800 million marks in the German industry.
  • The effects of Dawes Plan:
    • Germany resumed reparation payments
    • The French left the Ruhr
    • The German


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