In the early 1920's, hyperinflation and £6600m worth of war reparation payments sent Weimar Germany into deep finiancial decline and a economic slump. It was in 1924, shortly after Gustav Stresemann introduced the Rentenmark when the situation started to improve, started by implementation of the American 'Dawes plan' in August.
The key factors of this plan were the agreement that the reparations should paid over a lengthened period of time, and the £100m worth of gold given to Germany to strengthen the currency. Passive resistance in the Ruhr was no longer supported by the Weimar government. Employment rose to healthier levels, and reparation payments began at their new rate.The Locarno treaties signed by Britain, France, Italy, Poland, Czechoslovakia, and Belgium in October 1925 assured fixed boarders in western Germany to France and Belgium.Germany was admitted to the League of Nations in 1926.
This reopened international relations and earned her place on the world stage once again. This was also a sign that Germany was witnessing a upturn in its fortunes thanks to the steady leadership and decent economic conditions, which meant extremists like the Nazis and Communists gathered little public interest.Wise political decisions by Weimar chancellor Gustav Stresemann ensured stability and good progress for Germany following recovery of civil and economic unrest in the early years after WWI. The Dawes plan contributed to this significantly, enabling Germany to concentrate on becoming a peace-loving country rather than purely focusing on paying reparations.
Unfortunately, the economic progress made by this plan collapsed with the Wall St crash of 1929. The sudden decline in America’s economy suddenly lead to the loaned money to Germany being recalled. Money lent to Britain and France during the war was also being recalled by US banks, which was sought by the two countries in reparations from Germany -In conclusion, the 1924-1929 Weimar Germany period was one of good recovery from the national crisis in the early 1920's, and a return of Germany to international negotiations that appeared to show competence on the government's part before the start of the Global Depression.
