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Trust Trust often refers to: * Trust (social science), confidence in or dependence on a person or quality It may also refer to: Business and law * Trust law, a body of law under which one person holds property for the benefit of another * Trust (bus ...
agency"), colloquially referred to as , was an agency established by the government of the
German Democratic Republic German(s) may refer to: * Germany (of or related to) **Germania (historical use) * Germans, citizens of Germany, people of German ancestry, or native speakers of the German language ** For citizens of Germany, see also German nationality law **Ger ...
to reprivatise/
privatise Privatization (also privatisation in British English) can mean several different things, most commonly referring to moving something from the public sector into the private sector. It is also sometimes used as a synonym for deregulation when ...
East German enterprises,
Volkseigene Betriebe The Publicly Owned Enterprise (german: Volkseigener Betrieb; abbreviated VEB) was the main legal form of industrial enterprise in East Germany. They were all publicly owned and were formed after mass nationalisation between 1945 and the early 1960 ...
(VEBs), prior to
German reunification German reunification (german: link=no, Deutsche Wiedervereinigung) was the process of re-establishing Germany as a united and fully sovereign state, which took place between 2 May 1989 and 15 March 1991. The day of 3 October 1990 when the Ge ...
. Created by the
Volkskammer __NOTOC__ The Volkskammer (, ''People's Chamber'') was the unicameral legislature of the German Democratic Republic (colloquially known as East Germany). The Volkskammer was initially the lower house of a bicameral legislature. The upper house ...
on 17 June 1990, it oversaw the restructure and sale of about 8,500 state-owned companies with over four million employees. At that time, it was the world's largest industrial enterprise, controlling everything from steel works to the
Babelsberg Studios Babelsberg Film Studio (german: Filmstudio Babelsberg), located in Potsdam-Babelsberg outside Berlin, Germany, is the second oldest large-scale film studio in the world only preceded by the Danish Nordisk Film (est. 1906), producing films since ...
.


Responsibilities

The Treuhand was responsible for more than just the 8,500 state-owned enterprises. It also took over around 2.4 million hectares of agricultural land and forests, the property of the former
Stasi The Ministry for State Security, commonly known as the (),An abbreviation of . was the Intelligence agency, state security service of the East Germany from 1950 to 1990. The Stasi's function was similar to the KGB, serving as a means of maint ...
, large parts of the property of the former
National People's Army The National People's Army (german: Nationale Volksarmee, ; NVA ) were the armed forces of the German Democratic Republic (GDR) from 1956 to 1990. The NVA was organized into four branches: the (Ground Forces), the (Navy), the (Air Force) an ...
, large-scale public housing property, and the property of the state pharmacy network. On the day of
reunification A political union is a type of political entity which is composed of, or created from, smaller polities, or the process which achieves this. These smaller polities are usually called federated states and federal territories in a federal governm ...
, 3 October 1990, it took over the property of the political parties and the mass organisations of the
German Democratic Republic German(s) may refer to: * Germany (of or related to) **Germania (historical use) * Germans, citizens of Germany, people of German ancestry, or native speakers of the German language ** For citizens of Germany, see also German nationality law **Ger ...
.


Opposition

Its operations drew criticism for unnecessarily closing allegedly profitable businesses, misuse and waste of funds and layoffs that were claimed to be unnecessary. It also drew substantial protest from the workforces affected, as 2.5 million employees in state-owned enterprises (out of 4 million in total) were laid off in the early 1990s. Supporters argued that not placing the former state-owned enterprises into private hands would have caused the loss of many more jobs and slowed economic recovery. On 1 April 1991, chairman of the Treuhand
Detlev Karsten Rohwedder Detlev Karsten Rohwedder (16 October 1932 – 1 April 1991) was a German manager and politician, as member of the Social Democratic Party. He was named president of the Treuhandanstalt, responsible for the privatisation of state-owned property in ...
was shot dead by an unknown assassin (possibly the
Red Army Faction The Red Army Faction (RAF, ; , ),See the section "Name" also known as the Baader–Meinhof Group or Baader–Meinhof Gang (, , active 1970–1998), was a West German far-left Marxist-Leninist urban guerrilla group founded in 1970. The ...
). He was succeeded by
Birgit Breuel Birgit Breuel (''née'' Münchmeyer; born 7 September 1937 in Hamburg-Rissen) is a German politician, representative of the German Christian Democratic Union (CDU). She is the former President of the Treuhand Agency, and Commissioner General of ...
. When its operations ended in 1994, it had amassed 260 to 270 billion DM in debt.


Successors

Total land sales by the BVVG amounted to around half the area of the state of Saxony-Anhalt Although the Treuhand ceased operations in 1994, it still retained much property and some other legal responsibilities. These were transferred to three successor agencies: * the ''Bundesanstalt für vereinigungsbedingte Sonderaufgaben'', BvS (Federal Agency for Unification-related Special Tasks), which managed remaining state-owned enterprises; * the ''Treuhandliegenschaftsgesellschaft'' (now TLG Immobilien GmbH), which manages the remaining state-owned urban and industrial real estate; * the ''Bodenverwertungs- und -verwaltungs GmbH'' (BVVG), a subsidiary of the Treuhand created in 1992, which manages the state-owned agricultural land, forest lands, and related real estate. The BvS ceased operations at the end of 2000, but it remains legally in existence; its remaining tasks are all delegated to other bodies. TLG and BVVG remain the largest real estate owners in the new federal states. In 2000, TLG was reoriented from focussing on privatisation of its assets to "active portfolio management" with a view to making profits for the German federal government. By 2007, having sold 45,000 properties in six years and reinvested 1.5 billion euros, it was still managing 1500 properties worth 1.4 billion euros. The planned privatisation of TLG itself was put on hold in July 2008 because of adverse economic conditions. In January 2020, TLG Immobilien was acquired by the Luxembourg-domiciled property company Aroundtown SA. In July 2008, the BVVG announced total privatization receipts of 3.5 billion euros since its establishment in 1992, which it had gained through the sale of around of agricultural land, with a similar amount of forest land and a small amount of other land. Total land sales amounted to around half the area of the state of
Saxony-Anhalt Saxony-Anhalt (german: Sachsen-Anhalt ; nds, Sassen-Anholt) is a state of Germany, bordering the states of Brandenburg, Saxony, Thuringia and Lower Saxony. It covers an area of and has a population of 2.18 million inhabitants, making it the ...
. At the end of 2007, it still owned over of agricultural land and just under of forest land."BVVG erzielt in 16 Jahren für den Bund über drei Milliarden Euro Überschuss"
BVVG press release 24 July 2008


References


Further reading

* Mark Cassell, ''How Governments Privatize: the Politics of Divestment in the United States and Germany'', Georgetown University Press, 2002. *
Vladimiro Giacché Vladimiro is a male given name deriving from the Slavic name Vladimir. Those bearing it include: * Vladimiro Montesinos (born 1946, in Arequipa), Peruvian intelligence officer * Vladimiro Schettina (born 1955, in Asunción), Paraguayan football ...
, ''Anschluss: Die deutsche Vereinigung und die Zukunft Europas'', Laika-Verlag, Hamburg 2014, German Edition, . {{Authority control Economy of East Germany 1990 establishments in East Germany Privatization funds