Germany: Did Hungary open its borders in 1989 with financial exchanges?

So far, the official answer to whether the West German government helped in 1989 to relieve Hungary’s debt in exchange for opening its borders to East German citizens who wanted to escape to the West has been negative. However, two Czechoslovak secret service documents brought to light by German public radio (Deutschlandfunk) raise doubts. It is unknown who compiled them, who is hiding behind such sensitive information and of course how reliable they are.

Since May 1989, more and more citizens of the “German Democratic Republic” (GDR) fled across the Hungarian border to the West. In August there was a first mass exodus and on the night of 10-11 September 1989, Hungary opened its borders. In the following days, tens of thousands of GDR citizens fled to the West. The then Hungarian Prime Minister Miklos Nemet had emphasized that “Hungary does not sell people”. This sentence is quoted by the website of the German government. However, two previously unknown Czechoslovak intelligence documents, which are available to German public radio (Deutschlandfunk), cast doubt on the claim that Hungary received nothing in return for opening the border in 1989.

The first document (from the “Stasi Documentation Service”, which is in the German State Archives), dates from the fall of 1989 and is entitled: “Information of the Security Organs of the Socialist Republic of Czechoslovakia” and concludes that the West German government used targeted its financial resources to open Hungary’s borders for those who wanted to leave East Germany. The German translation was undertaken by the Ministry of State Security of the “German Democratic Republic” (GDR). Under the note “Translated from Czech” is written in capital letters “TOP SECRET!” and on the upper right by hand: “6.10.89 to the (comrade) Minister”. The translation is personally addressed to the infamous head of the Stasi, Erich Mielke.

“According to the information so far from diplomatic and financial circles of the Federal Republic of Germany (FDR), it is clear that Hungary’s actions in the case of GDR refugees have economic, fiscal and foreign policy reasons,” the document says. And this is because Hungary had large debts to the West German banks and to the Federal Republic of Germany (FDR) itself. “The country will have to pay creditors more than $2.5 billion, which represents about 50% of net foreign trade earnings,” the document also said.

“Information confirms that an agreement has been reached between the governments of the Federal Republic of Germany (FDR) and the People’s Republic of Hungary (HDR) on the payment of an amount to the refugees of the GDR equal to that paid to the German People’s Republic (GDR) in the past for the release of political prisoners,” the Czechoslovak secret service report also states. If her information is correct, the agreement between Budapest and Bonn was linked to this practice. The amount paid by West Germany to the East (GDR) amounted to about 90,000 DM per person towards the end of the second. For Hungary, this meant huge fiscal relief for paying off its debt in 1989. “Hungary will get 150 to 200 million (marks) this way. With this amount it reduced the payments it had to make to the FDR for a government loan granted to her in previous years,” the Czechoslovak Intelligence Service document in question estimates. “At the same time, the West German government promised to use its influence in banking circles so that private banks would accommodate Hungarian wishes,” he adds.

According to the report, Hungary was already on the way to its integration into the Western economic system in 1989 – in the form of participation of Western companies in the equity capital of Hungarians: “These actions will bring to the Hungarian People’s Republic (LDH) about 300 million dollars in 1989 alone. It is expected that West German companies will have a significant share of this amount.”

A second Czechoslovak secret service document, dated October 5, 1989, also available to the German public radio (Deutschlandfunk), concerns 230 East German refugees in the West German embassy in Warsaw. And this document is marked “Top Secret!” and it is translated into German by the Stasi, but from Russian. And it states that the (West) German government is putting targeted “politico-economic pressure on the current government of the Polish People’s Republic (PLD)” to achieve a “solution based on the Hungarian model. A ship is already ready to transport around 120 people in West Germany”.

Source: AMPE