Austria's Post-Wwi Reparations: A Heavy Price Paid

After World War I, the victorious Western powers imposed a series of harsh treaties on the defeated nations, which included significant reparation payments. The Treaty of Saint-Germain-en-Laye of 10 September 1919, established the Republic of Austria, consisting of most of the truncated German-speaking regions of the Habsburg state. Austria was to pay reparations, but the exact value was to be determined later. In 1921, the Reparation Commission determined that Austria was unable to pay reparations due to its economic state, so the Commission decided that the credit of the property taken from Austria by the Treaty of Saint-Germain-en-Laye was sufficient payment. Austria also lost over 215,000 square miles of land holdings.

The Treaty of Saint-Germain-en-Laye

The treaty covers 381 articles divided into 14 parts and is written in French, English, and Italian. The first part includes the Covenant of the League of Nations, which the United States did not sign, instead opting for the US–Austrian Peace Treaty of 1921. The treaty's second part covers the frontiers of Austria, establishing fixed boundaries enforced by a boundary commission. Austrian territory was reduced to the borders of Austria alone, leaving it at around 40% of its pre-war size.

The treaty also included political, military, naval, and air clauses. Austria was to renounce further territory in favour of Italy, the Serb-Croat-Slovene State, the Czechoslovak State, and Romania. The Austrian Army was limited to 30,000 volunteers, and conscription was abolished. All warships and submarines were to be surrendered, and air forces were to be abolished.

The treaty included reparations, with Article 177 forcing Austria to accept responsibility for starting the war. Although no exact amount was defined or collected, Austria was required to compensate for damage to civilian populations and their property, as determined by a Reparation Commission. The treaty also included financial clauses, such as requiring the Austrian government to pay the total cost of the armies of occupation and banning the sale of gold.

Austria's economic state

The Treaty of Saint-Germain-en-Laye of September 10, 1919, established the Republic of Austria, consisting of most of the truncated German-speaking regions of the former Habsburg state. The treaty also barred Austria from compromising its newly formed independence, effectively prohibiting unification with Germany.

The Allies recognised that Austria did not have the ability to pay reparations due to its poor economic state. In 1921, the Reparation Commission determined that Austria was unable to pay and decided that the credit of the property taken from Austria by the Treaty of Saint-Germain-en-Laye was sufficient payment.

Austria's liability for reparations

After World War I, the victorious Western powers imposed a series of harsh treaties on the defeated nations, which included significant reparation payments. The Treaty of Saint-Germain-en-Laye of 10 September 1919, established the Republic of Austria, consisting of most of the truncated German-speaking regions of the Habsburg state. Austria was to pay reparations, but the exact value was to be determined later. The treaty also ceded crown lands to newly established successor states like Czechoslovakia, Poland, and the Kingdom of Slovenes, Croats, and Serbs, which became Yugoslavia in 1929. Austria also relinquished the South Tyrol, Trieste, Trentino, and Istria to Italy, and Bukovina to Romania.

In 1921, the Reparation Commission determined that Austria was unable to pay reparations due to its economic state. The Commission decided that the credit of the property taken from Austria by the Treaty of Saint-Germain-en-Laye was sufficient payment. This was a substantial amount, considering Austria lost over 215,000 square miles of land holdings.

Austria was also liable for reparations after World War II, paying around $2 billion to the Soviet Union, although this was offset by the massive amount of aid given by the United States through the Marshall Plan.

Austria's loss of territories

Austria's territorial losses were not only limited to the Treaty of Saint-Germain-en-Laye. Under the Treaty of Versailles, Austria's former ally Germany was forced to cede territories to Belgium, Czechoslovakia, and Poland. Germany also lost its overseas colonies, which became League of Nations Mandates. The treaty also demanded the demilitarisation and occupation of the Rhineland, and special status for the Saarland under French control.

Austria's economic situation after the war was so poor that few to no reparations were paid, and the requirements were eventually cancelled. The credit of the property taken from Austria by the Treaty of Saint-Germain-en-Laye was deemed sufficient payment. Considering the substantial loss of territories, this was quite a substantial concession.

Austria's reparations after WWII

After World War II, Austria was split into zones of influence and occupied by Allied Forces for ten years. This occupation was less about punishment and more about rebuilding the country and establishing the borders of the Iron Curtain. However, Austria did pay around $2 billion to the Soviet Union, which was somewhat offset by the massive amount of aid given by the United States through the Marshall Plan.

Austria was not punished as severely as Germany after World War I, perhaps because it became a part of Germany. However, Austria did lose over 215,000 square miles of land holdings, which was considered sufficient payment by the Reparation Commission.

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