Modern Germany is the period post World War II when Germany was split. In the Potsdam Conference the Allies divided the country into four zones and Berlin was divided into four sectors. It was a pathetic situation in Germany .The territory was invaded by foreign armies. Places and infrastructure were changed .The country was full of refugees facing hunger, sufferings, loss of homes and poverty.
In 1961
East Germany
separated itself from West Germany by building a wall through the middle of Berlin.
The situation changed in 1989. Berlin wall between east & West Germany was broken down bringing peace again. October 3, 1990 Germany was reunited again. The six federal states of East Germany were Brandenburg, Berlin, Mecklenburg, Saxony, Saxony-Anhalt, and Thuringia was under the Federal Republic of Germany. The German government signed a treaty with Poland on November 14, 1990, in which Germany's boundaries were extended along the Oder-Neisse line, Silesia, Farther Pomerania, and territories of East Prussia.
The first general elections took place on December 2, 1990 and Helmut Kohl became the first Chancellor of the country. The economy of East Germany was weak as compared to West. The reunion had created problems contributing a negative effect on the Economy of the country. The exchange rate of East German and West German currency was artificially inflated for political reasons. Though West Germany had large investments on business many East German businesses collapsed leading to fall of the whole countries economy.
As a result of the reunification, unemployment rate increased remarkably in some parts of the country. East Germans now continue to migrate to western Germany to find jobs, which resulted in the loss of highly educated and skilled workers in the eastern region.
The German Central Bank and many economists have rightly said that the cause of many problems in the German economy is actually reunification.
