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For comparison Germany unification has now cost roughly ~100billion per year for 20 years, so far. So roughly 2 trillion total. Given that the DDR was actually
by orbifold 12y ago
For comparison Germany unification has now cost roughly ~100billion per year for 20 years, so far. So roughly 2 trillion total. Given that the DDR was actually in relatively good shape compared to North Korea, that is there weren't any famines, it had a more or less working industry and a very good education system, I believe South Korea would have to bear much higher costs per annum.
- pgodzin 12y agoAny idea how much the initial conversion of currency at below going rate cost?
- kalms 12y agoAs to my knowledge, most industries became obsolete after reunification, since they only built and developed state sanctioned products that wasn't needed after that event.
- lgierth 12y agoMost of the industrial production means was sold to western capital in the early 90s by the Treuhandanstalt (trust agency), and the companies were closed. Edit: this was of course one of the biggest waves of privatization Germany has seen. The English Wikipedia has a bit more information: https://en.wikipedia.org/wiki/Treuhand https://en.wikipedia.org/wiki/Treuhand
- justincormack 12y agoThey were sold. That means they were not closed, you do not buy something and then shut it down. Some was shut down later, or repurposed.
- blahedo 12y ago> You do not buy something and then shut it down. An ironic comment on Hacker News, of all places.
- kamaal 12y agoBuying something to shut it down, might work for internet business which large Internet MegaCorps wish to shut down if they are working on something similar in house. But a country wide railway line, or a underground cable network and things like that don't just get shut down to suppress competition.
- lgierth 12y agoWith industrial production means, I meant machines. The machines were sold, and the companies/factories shut down. Not much to produce without machines :)
- orbifold 12y agoI believe the majority opinion is that most of the east german industries were not competitive, as you say. Others suggest that the immediate privatisation gave western companies in the same sectors the opportunity to eliminate competition at a very low price.
- harryh 12y agoNorth Korea also has a 50% larger population compared to East Germany at the time of reunification (~24M vs ~16M) which, it seems to me, would only increase the costs.
- justincormack 12y agoAnd it is much poorer, and far behind technologically.
- restalis 12y agoNitpick: The East Germany had indeed 16 million people at the reunification, but the West was far over 24 million! I don't know where you took your figures from, but Wikipedia says over 63 million: http://en.wikipedia.org/wiki/West_Germany#Population http://en.wikipedia.org/wiki/West_Germany#Population
- fairthinkum 12y agoThe 24 million he is referring to is the population of North Korea.