This is in stark contrast to recent and current policy towards the southern countries of the euro area. Ironically, Germany was the biggest European debt transgressor of the 20th century, as Thomas Piketty and Albrecht Ritschl pointed out (Harlan 2015, Ritschl 2011). Germany insists that Greece, Portugal or Spain respect their commitments and forgets that Europe was built in part on debt absolution, so that new generations have not paid for the mistakes of the past. If we look at the LDA again, we can see how different the policies of the eurozone crisis have been and how this policy can help explain the duration of the related recessions. The London Debt Agreement (LDA) eliminated half of West Germany`s external debt. The following years saw unprecedented economic growth. The LDA has likely contributed to economic growth by creating fiscal space for public investment and social spending, restoring the full convertibility of the German mark and stabilizing inflation. The LDA resulted in a significant and statistically significant increase in per capita social spending compared to other categories of spending. Synthetic control methods also show that the counterfactual „no“ to debt cancellation could have reduced total spending by 17%. The LDA also facilitated Germany`s reintegration into world markets and the full conversion of the German mark by catalyzing the accumulation of sufficient reserves in US dollars. In response to the Allies, Adenauer informed them of Germany`s desire to repay its debts. The German External Debt Conference (also known as the London Debt Conference) was held from 28 February 1952 to 28 February 1952.
August 1952.  The agreement reached at the conference was signed in London on 27 February 1953.  The Agreement was ratified on 16 September 1953 by the United States, France and the United Kingdom, after which the Agreement entered into force. The deal was first rejected by the Bundestag and then approved in a subsequent vote.   Creditors systematically refuse to include such a clause in agreements with developing countries. This analysis has several limitations. While we can explain the immediate fiscal transformation that came with the LDA, it is more difficult to accurately quantify the impact on overall economic growth. The German economy had already grown by 8% between 1950 and 1952. It is hard to imagine whether the debt restructuring conditions would have been the same without the first signs of recovery from Germany.
As debt restructuring is linked to the Marshall Plan and is part of a wide range of European stimulus measures, it is difficult to see the success of the LDA without the conditions that were created by the monetary reform of 1948 and the creation of the European Payments Union. . . .