KQ4: Economic stagnation in the 1980s

Question 1

Give evidence of the growing national debt

Answer 1

• GDR debt to the West doubled between 1977 and 1981

Debt to capitalist countries
1980 = 30 billion DM
1989 = 46 billion DM

Question 2

Give evidence of high spending on health and welfare

Answer 2

16.8% of GDP in 1979 and remained high

Question 3

Give evidence of the poor quality/lack of availability of consumer goods

Answer 3

• people could wait up to 13 years to be connected to a telephone

Question 4

Give 4 factors contributing to economic stagnation.

Answer 4

1. Honecker’s return to central planning
2. Withdrawal of favourable trading conditions withe the USSR via COMECON
3. Trade deficit and fuel shortages
4. Growing national debt (compounded with increased interest rates)

Question 5

Give evidence of massive loans from the FRG.

Answer 5

The GDR and the FRG negotiated two massive loans.
1983 = DM 1 billion
1984 = 950 million

Question 6

Give evidence of poor housing in the GDR

Answer 6

60% of housing lacked central heating

33% still had outdoor toilets