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The State Treaty between the FRG and the GDR on the Creation of a Monetary, Economic, and Social Union (May 18, 1990)

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ARTICLE 2: Principles
(1) The Contracting Parties are committed to a free, democratic, federal and social basic order governed by the rule of law. To ensure the rights laid down in or following from this Treaty, they shall especially guarantee freedom of contract, freedom to exercise a trade, freedom of establishment and occupation, and freedom of movement of Germans in the entire currency area, freedom to form associations to safeguard and enhance working and economic conditions and, in accordance with Annex IX, ownership of land and means of production by private investors.
(2) Contrary provisions of the Constitution of the German Democratic Republic relating to its former socialist social and political system shall no longer be applied. [ . . . ]


ARTICLE 10: Prerequisites and Principles
(1) Through the establishment of a monetary union between the Contracting Parties, the Deutsche Mark shall be the means of payment, unit of account and means of deposit in the entire currency area. To this end, the monetary responsibility of the Deutsche Bundesbank as the sole issuing bank for this currency shall be extended to the entire currency area. The issuance of coin shall be the exclusive right of the Federal Republic of Germany.
(2) Enjoyment of the advantages of monetary union presupposes a stable monetary value for the economy of the German Democratic Republic, while currency stability must be maintained in the Federal Republic of Germany. The Contracting Parties shall therefore choose conversion modalities which do not cause any inflationary tendencies in the entire area of the monetary union and which at the same time increase the competitiveness of enterprises in the German Democratic Republic.
(3) The Deutsche Bundesbank, by deploying its instruments on its own responsibility and, pursuant to Section 12 of the Bundesbank Law, independent of instructions from the Governments of the Contracting Parties, shall regulate the circulation of money and credit supply in the entire currency area with the aim of safeguarding the currency.
(4) Monetary control presupposes that the German Democratic Republic establishes a free-market credit system. This shall include a system of commercial banks operating according to private-sector principles, with competing private, cooperative and public-law banks, as well as a free money and a free capital market and non-regulated interest-rate fixing on financial markets. [ . . . ]
(7) The Deutsche Bundesbank shall exercise the powers accorded it by this Treaty and by the Law concerning the Deutsche Bundesbank in the entire currency area. It shall establish for this purpose a provisional office in Berlin with up to fifteen branches in the German Democratic Republic, which shall be located in the premises of the State Bank of the German Democratic Republic.

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