On This Day August 8, 1953: Germany’s Debt is Forgiven by the United States, England– Greece– and Other Nations


The London Agreement on German External Debts, also known as the London Debt Agreement closed on August 8, 1953, with countries like the United States, England— including Greece— forgiving massive loans the Germans had amassed both pre and post World War II.

Economist Thomas Piketty on Germany’s opposition to restructuring Greece’s debt today and the London Agreement of 1953:

“When I hear the Germans say that they maintain a very moral stance about debt and strongly believe that debts must be repaid, then I think: what a huge joke! Germany is the country that has never repaid its debts…

“We never would have managed this unbelievably fast reduction in debt through the fiscal discipline that we today recommend to Greece… Think about the London Debt Agreement of 1953, where 60% of German foreign debt was cancelled and its internal debts were restructured.”


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