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Excerpt from an Explanation of the Two-Year Plan for 1949/50 (June 30, 1948)

The Two-Year Plan of June 30, 1948, which laid out detailed plans for the economic development of the Soviet occupation zone/GDR for the years 1949 and 1950, took its economic cues from prewar figures. It highlighted the successes that had already been achieved in the nationalization of mineral resources and industries and in agricultural land reform. With the expansion of Agricultural Production Cooperatives [Landwirtschaftliche Produktionsgenossenschaften or LPGs] in 1952 and the extensive compulsory collectivization that followed in 1960, the guarantee of land ownership to farmers soon became irrelevant.

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With the dispossession of the Nazi and war criminals, ownership of key economic holdings in the Soviet occupation zone has passed into the hands of the people. Nationally-owned enterprises [Volkseigene Betriebe] are now the foundation of industry. In the first quarter of 1948, these enterprises represented only 8% of the total number of companies required to register, but they were responsible for nearly 40% of production in the most important branches of industry in the Soviet occupation zone. The majority of companies remained in private hands, but the rule of the monopolies was broken.

The following table shows the contribution made by nationally-owned enterprises to the overall production of German industry in the first quarter of 1948:

Industrial sector

Percentage of production from nationally-owned enterprises

1. Mining


2. Metallurgy


3. Machine building and metal processing industry


4. Electronics industry


5. Precision engineering and optics


6. Chemical industry


7. Construction materials


8. Wood processing industry


9. Textile industry


10. Light industry


11. Cellulose and paper industry


12. Electric energy and gas


Overall average production:

39 percent

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