German exchange control and clearing system (New Plan, 1934)

The German exchange control and clearing system, formalised in Hjalmar Schacht's New Plan of September 1934, was the body of decrees and administrative regulation by which Nazi Germany placed all imports under licence, rationed every unit of foreign exchange through the state, and channelled foreign trade into bilateral clearing agreements. It converted instruments born of financial emergency into a standing legal architecture of economic power, simultaneously sanctions-proofing Germany and subordinating its weaker trading partners.

Provisions

The system rested on three legal layers. The foundation was the exchange-control regime introduced by emergency decree during the July 1931 banking crisis, which ended the free convertibility of the Reichsmark and made the Reichsbank the gatekeeper of all foreign payments. The New Plan, announced by Hjalmar Schacht as Reichsbank president and Economics Minister in September 1934, generalised control: some two dozen supervisory boards (Überwachungsstellen) licensed imports commodity by commodity, and foreign exchange was allocated only against approved transactions. The third layer was the network of bilateral clearing agreements, under which trade with a partner state was settled through offsetting central-bank accounts rather than transfers of free currency, supplemented by special blocked-mark instruments such as aski accounts (Ausländer-Sonderkonten für Inlandszahlungen) usable only for purchases inside Germany.

Trigger and procedure

The formal trigger was scarcity: by mid-1934 German reserves were close to exhaustion, rearmament demanded imports, and Germany had suspended service on much of its foreign debt. Procedurally, the regime operated through administrative discretion rather than open prohibition. An importer required a licence; a licence required an exchange allocation; an allocation followed the state's priorities. The same machinery that managed scarcity thereby became a general instrument of direction, deciding what Germany bought, from whom, and on what terms.

Employment history

Employment as economic statecraft is treated in the case entry Schachtian bilateral clearing and the Reichsmark bloc (1934-1939). Germany ran deliberate clearing deficits with south-eastern European suppliers, accumulating blocked balances that partners could realise only by buying German goods, and redirected trade away from the sterling-dollar world toward states it could dominate. Albert O. Hirschman analysed the system in 1945 as the deliberate manufacture of asymmetric dependence, the study that stands behind modern weaponised interdependence theory.

Effects

As law, the system demonstrated that exchange control and import licensing, instruments most states treated as temporary crisis management, could be assembled into a permanent offensive-defensive architecture: a shield against blockade and currency pressure, and a lever over every economy that depended on the German market. It is the principal interwar case of autarkic sanctions-proofing, engineered on the explicit German diagnosis that the 1914-1919 blockade must never be repeatable. Its effectiveness is contested: Hirschman's reading of Balkan subordination is qualified by later scholarship noting that clearing partners extracted real gains, and Tooze's account stresses the system's chronic foreign-exchange strain, which shaped rather than solved Germany's strategic timetable. Its descendants are visible wherever states weaponise market access and payment channels rather than armies.

The New Plan was an administrative system rather than one statute. It is expired and historical. Import licensing, foreign-exchange allocation, debt-transfer restrictions and each clearing agreement were separate legal and administrative components. Claims that the system deliberately subordinated trade partners remain interpretive and must be attributed rather than treated as a self-proving feature of the decrees.

See also

Schachtian bilateral clearing and the Reichsmark bloc (1934-1939) · Hjalmar Schacht · Autarky · Weaponised interdependence · Albert O. Hirschman · Economic warfare · Economic statecraft

Sources

• Federal Reserve Bulletin, May 1935, accessed 30 July 2026.
• Bundesbank, *From the Reichsbank to the Bundesbank*, accessed 30 July 2026.
• US Embassy report on German clearing agreements, October 1934, accessed 30 July 2026.
• Schacht correspondence, March 1934, accessed 30 July 2026.
• Albert O. Hirschman, *National Power and the Structure of Foreign Trade*, accessed 30 July 2026.
• Adam Tooze, *The Wages of Destruction*, accessed 30 July 2026.