Conflict over Germany, 1947–49; Bizonia and currency reform

What were the USA and Britain keen to do by 1946?

Establish a degree of economic recovery in their zones

What were the British absorbing?

Huge numbers of German refugees expelled by the Poles and the Czechs

What problems were the other allies having with the USSR? (3 points)

* There was a continuing dispute with the USSR over the scale of reparations that it could demand from the Western zones
* The Soviet Union systematically removed industrial plant and other resources from Germany in order to restore its own industrial recovery
* The USSR wanted more reparations than the other allies could accept

What did Clay announce in May 1946?

That no further reparations to the USSR would be allowed until there was an overall plan agreed for Germany’s economic recovery.

What did the USSR see General Clay’s announcement as?

An American strategy designed to create a German economy based on the Western capitalist system.

What was the merging of the British and American zones into Bizonia an indicator of?

That the four-power control of Germany had failed

What was the American position on the creation on Bizonia?

That it was consistent with the Potsdam Agreement

What was the Soviet response to the creation of Bizonia?

To oppose it

What happened at the Moscow Conference? (3 points)

* The Council of Ministers, consisting of Britain, France, China, the USA and the USSR, met
* The USSR demanded that a new central administration should be created
* This Soviet attempt failed and no firm decisions on the future of Germany were reached

What happened at the London Conference? (3)

* This was a failure
* The USSR accused the West of unjustly denying it the reparations it was due, and the West feared that a centralised administration would lead to a Soviet-controlled Germany.
* The outcome of this conference was that the Western powers now recognised that four-power control of Germany would not work, and that there was now some urgency to strengthen the economy of the Western zones of Germany and move towards the creation of a West German state that was aligned to a Western alliance.

Who attended the London Conference of allies?

Britain, France, the USA and the Benelux states

What decisions were made at the London Conference of allies? (2)

* The decision to introduce a new currency into the Western Zones of Germany
* The decision that West Germany should have a formal constitution

What would the introduction of a new currency into the Western zones of Germany do?

This would not only move these zones towards greater economic stability but it would represent the beginnings of the formation of a separate and distinct West German state.

How was the decision to create a West German state brought about?

Through pressure from both the USA and Britain