German economic expansion

Before 1871

During the institution of the German Customers Union (1834/Zollverein), plans were first developed for a "large-area economy" under German leadership. The manufacturing nations of Prussia and Austria were to assume hegemony over an area extending from the North Sea to the Black Sea. The countries of eastern and south-eastern Europe were assigned the status of producers of food and raw materials. At the same time they were to serve as markets for German products and as a trade bridge to the Middle East. Areas of Africa and Latin America were seen as "complementary zones".

This continental imperialism was to endow Germany with major-power status in competition with Russia and the naval powers of England and France. The economic penetration of large areas of eastern and south-eastern Europe was based on control of the Danube plus the construction of railroad lines, which Prussian and Austrian financiers were pushing ahead rapidly.


Beside economic penetration by means of railroad construction and the provision of capital, a nationalistic or racial (völkische) form of German expansionism arose during the second half of the 19th century, aiming at territorial annexation and the undermining and control of the targeted European states by, among other things, strengthening German minorities. This goal was fostered primarily by the leaders of heavy industry, large property owners (junkers) and the middle classes. Their most important mouthpiece became the "Pan-German Union" founded around 1890. A second faction, recruited primarily among circles of the newer industries such as the electrical, chemical and export industries, favoured the expansion and the securing of German economic hegemony in Europe by means of bilateral and multilateral trade agreements. Their prime representative institution before the First World War was the "Central European Economic Association" founded in 1903.

In spite of differences in strategy, both groups agreed on the goal of a European large-area economy under German dominance, that - as described in many plans, popular brochures and strategy papers - was meanwhile expected to extend from the North Sea to the Persian Gulf. Both factions subsumed this goal under the designation of "Central Europe". Because the peaceful penetration by means of capital loans and trade agreements met with difficulties and growing opposition, both factions agreed to seek a solution in the forcible establishment of a "major Central European economic region" over against England, France, Russian and the US. This was the primary German motive for unleashing the First World War.


Put on the defensive by the loss of the war and the ensuing peace treaties, German policy was first concerned with the prevention of multilateral trade agreements to which it was not a participant, e.g. a Danube Federation between Austria and eastern and south-eastern European states. German foreign policy activities in the Weimar Republic were directed in equal measure against the French "Pan-Europe Project", which was to preclude the possibility of German hegemony on the continent. One essential means of "quiet diplomacy" for the maintenance of large-area claims was the secret, liberal funding of German minorities in eastern and south-eastern Europe.

In 1925 a lobby organisation was formed, the German Group of the Central European Economic Conference, to promote the realisation of German large-area plans. Immediately after the world economic crisis of 1929/30 (and not only, as has been maintained by propaganda, after 1933 under Nazi rule) new plans for a now openly termed "German large-area economy". This aimed at the long-term subordination and control of large areas of eastern and central Europe through the conclusion of bilateral currency-free trade agreements. They proceeded on the basic assumption that German industrial products were to be traded for eastern and central European agricultural products and raw materials. The "new plan" of Minister for Economic Affairs Schacht in 1934 made such clearing agreements the decisive instrument of National Socialist foreign policy in preparation for World War II. Important segments of German import demand were re-routed from South America to eastern and south-eastern Europe, so that for war purposes a source of food and raw materials would be available that could not be blockaded. For the long-term implementation of an "organic division of labour" in the European large-area economy, strategists of the Central European Economic Conference under the leadership of IG Farben worked in cooperation with the German government during the nineteen-thirties for the restructuring of the eastern and south-eastern European economy. The goal of this effort was the extensive de-industrialisation of this area and the orientation of its agricultural production toward the demands of the German market. Beside the ransacking of important resources, this long-term goal continued to be pursued during World War II. Military hegemony over the economic "complementary area" was indispensible for the German war-waging capacity.


Through the Marshall Plan and the avoidance of reparations in the London Debt Agreement of 1952, Germany rapidly became the leading economic power in Europe. Former plans for a European large-area economy without trade barriers under German leadership were pursued through the establishment of and participation in the European Economic Community (EEC), later the European Community (EC) and the European Union (EU). As early as the nineteen-fifties the German economy already supplanted the American and West-European competition in the eastern and south-eastern European states. The Hallstein-Doctrine notwithstanding, Germany became the foremost trading power in eastern and south-eastern Europe after the Soviet Union. Credit agreements and an imbalance in the terms of trade were used to drive eastern and south-eastern European states into debt and long-term dependence.


After the end of the socialist system German economic interests strove for a separation of economically lucrative areas and production zones and their complete detachment from economically uninteresting and debt-ridden areas in eastern and south-eastern Europe.

This was the fundamental background for German support of the dissolution of Yugoslavia, Czechoslovakia and the Soviet-Union. The new Baltic states, the Czech Republic, Croatia and Slovenia were closely bound to the European Union by means of association treaties, whose conditions forced them to restructure their economies. This was combined with the louder and louder propagation of the idea of a Europe with a hard core (Kerneuropa), that is, the creation of a hierarchy within the European Union, the decision-making centre of which was to consist of Germany as the leading power and France as a junior partner. After an attempt by Wolfgang Schäuble and Karl Lamers in 1993 was firmly repulsed by the other states of the EU, the German concept of a European nucleus with concentric circles of varying depths of production and degrees of bonding has meanwhile been gradually implemented by Gerhard Schröder and Josef Fischer.