Germany’s War Debt to Greece: A Burden Unsettled by Nicos Christodoulakis (review)

This book was published a year before a new Greek government led by SYRIZA (Coalition of the Radical Left) formalized and quantified on 6 April 2015 the country’s claim for war reparations from Germany for damages to life and property caused during World War II. SYRIZA presented a figure of €279 billion as Germany’s debt to Greece. This figure includes war reparations, restitution for objects taken, and the repayment of the occupation loan that Nazi Germany extorted from the Bank of Greece and whose present value is estimated at €10.3 billion. The campaign for reparations has been gaining momentum since 2010, when Greece was on the verge of bankruptcy and the European Union and the International Monetary Fund (IMF) offered a bailout loan. Greece won a second bailout in 2012, and, at the time of writing this review, press reports in Germany indicated that discussions were underway to provide a third bailout. Unable to overhaul its economy and tackle its debt, Greece has blamed the persistent crisis on the tough austerity measures demanded by its creditors, especially the Germans. Greece borrowed about €15 billion directly from Germany, and settling this debt with reparation funds, beginning with the immediate repayment of the occupation loan, seems to many Greeks the easiest short-term fix. It is in the context of this debate about money but also about compensatory justice and its ability to reconcile and heal that Nicos Christodoulakis’s book is topical.

Christodoulakis is not the first to deal with this very specialized and complex topic, but his attempt to estimate the loan’s value “with precision” (3) is useful, especially since the calculations by Greece’s General Accounting Office might remain classified. Christodoulakis deplores the damaging effect of publicized exorbitant figures that were not officially corrected, which caused the Greek public to believe that repayment of such sums would be the solution to all of Greece’s fiscal and economic troubles. He believes that a more conservative estimate of the loan might improve Greece’s chances of achieving its repayment and thus makes the calculation of the loan’s current value the primary goal of his short book.

As a professor of Economic Analysis at the Athens University of Economics and Business, as well as a former Greek Minister for Economy and Finance (2001–2004), Christodoulakis brings expertise and insider knowledge to this issue. The back cover promises that the book provides “a close study of Greece’s economic history and present crisis.” But this is not what this book offers. Moreover, as Christodoulakis clarifies in the preface, his purpose is not “to provide a historical or legal analysis of the issues connected to the Occupation Loan or the war reparation claims at large” but to propose “a feasible and mutually admissible way in which this longstanding dispute between Greece and Germany can be settled for good” (ix). He enters the discussion convinced that Greece’s claim has been substantiated by other scholars and bases many of his arguments on a monograph by Tasos Iliadakis (2012) and an article by Antonis Bredimas (2012). Both authors have not consulted material on the topic in German archives and have bypassed the challenge of having to prove whether this was a normal credit arrangement or another case of wartime theft. In April 1945, Dr. S. Nestler, Oberre-gierungsrat to the economic department of the Office of the Reich Foreign Ministry Special Plenipotentiary for the Southeast, who had participated in the loan negotiations, repeatedly explained that the credit arrangement was more or less an “optical” prop to the Greek government aimed at appeasing Greek public opinion about the swelling national deficit (Nestler 1944, 82; Etmektsoglou 1996, 2005).

In his first three chapters, Christodoulakis offers a sketchy overview of wartime and postwar negotiations on the issue of the occupation loan. He concludes that the loan “was not a voluntary credit facility” (4), pointing to...