French Invasion of the Ruhr in 1923

• The French Occupation of the Ruhr took place on March 1923 where French and Belgian soldiers invaded and occupied the Ruhr (German Industrial Area) after the Weimar Government was unable to pay the reparations.

• The French began to take coal, machinery and other resources from the Ruhr as payment for reparations.

• The Government decided to call on the workers in the Ruhr to go on strike with the aim of resisting the French Occupation.

• Although the French left the Ruhr, there was still a problem. The Government had printed much more money between March and November of 1923 as they needed to pay the striking workers. This led to Hyperinflation (where currency becomes almost worthless) and many people lost their savings and the price of goods increased.

• To solve the problem of Hyperinflation, the Weimar Republic asked the USA to loan money, which they could use to pay the reparations and invest in the German economy.

• They also decided to scrap the old currency and introduce a new one, which was called the Rentenmark. They then knocked off the noughts and strictly limited the amount of the new currency that could be printed before a new one was introduced.

• The League was ineffective in solving this dispute as the French and Belgian invasion was technically legal under the Treaty of Versailles.

Hyperinflation

The Government needed to pay reparations and the salaries of striking workers, so more money had to be printed. 

As a result, the economy declined, the German currency, savings and pensions became worthless, the prices of good increased and German citizens lost confidence in the Weimar government.