chapter  1
6 Pages

Introduction

At the turn of the year from 1994 to 1995 the Treuhandanstalt was dissolved. It had, all in all, completed its task of privatizing Eastern Germany’s stock of enterprises. Eastern Germany is thus one of the first transforming economies of Central and Eastern Europe to have completed the process of privatizing the core stocks of the state-owned industrial sector. Privatization was in Eastern Germany-as it is in the other transition countries-part of a sweeping transformation program aimed at decentralizing economic decision-making and denationalizing broad segments of economy and society. A privatization process so broad in scope, one extending not only to individual enterprises and sectors but to the core areas of the economy as well, is historically unprecedented. In view of the dramatic cutbacks in production capacities and employment in Treuhandanstalt and former Treuhandanstalt enterprises, the agency’s privatization strategy continues to be controversial: the pace of privatization, the choice of privatization procedures, and the decision to refrain largely from investing in rehabilitation measures are, even today, the topic of a controversial discussion.