Under Chancellor Adenauer West Germany declared its right to speak for the entire German nation. The Hallstein Doctrine restricted diplomatic relations to countries that refused to give East Germany the status of state.

The constant stream of East Germans fleeing to West Germany placed great strains on East German-West German relations in the 1950s. East Germany sealed the borders to West Germany in 1952, but people continued to flee from East Berlin to West Berlin. On August 13, 1961, East Germany began building the Berlin Wall around West Berlin to slow the flood of refugees to a trickle, effectively cutting the city in half and making West Berlin an exclave of the Western world in communist territory. The Wall became the symbol of the Cold War and the division of Europe. Shortly afterwards, the main border between the two Germanies was fortified.

In 1969, Chancellor Brandt announced that West Germany would remain firmly rooted in the Atlantic alliance but would intensify efforts to improve relations with Eastern Europe and East Germany. West Germany commenced this Ostpolitik, initially under fierce opposition from the conservatives, by negotiating nonaggression treaties with the Soviet Union, Poland, Czechoslovakia, Bulgaria, and Hungary.

West Germany's relations with East Germany posed particularly difficult questions. Though anxious to relieve serious hardships for divided families and to reduce friction, West Germany under Brandt's Ostpolitik was intent on holding to its concept of "two German states in one German nation." Relations improved, however, and in September 1973, East Germany and West Germany were admitted to the United Nations. The two Germanies exchanged permanent representatives in 1974, and, in 1987, East German head of state Erich Honecker paid an official visit to West Germany.

The unification of East and West Germany

Background

International plans for the unification of Germany were made during the early years following the establishment of the two states, but to no avail. In March 1952, the Soviet government proposed holding elections for a united German assembly while making the proposed united Germany a neutral state, as eventually did Austria. The Western Allied governments refused this initiative, while continuing West Germany's integration into the western alliance system. The issue was raised again during the Foreign Ministers' Conference in Berlin in Jan.-Feb. 1954, but the western powers refused making Germany neutral. Following Bonn's adherence to NATO on May 9, 1955, such initiatives were abandoned by both sides.

During the summer of 1989, rapid changes took place in East Germany, which ultimately led to German reunification. Growing numbers of East Germans emigrated to West Germany via Hungary after the Hungarians decided not to use force to stop them. Thousands of East Germans also tried to reach the West by staging sit-ins at West German diplomatic facilities in other East European capitals. The exodus generated demands within East Germany for political change, and mass demonstrations with eventually hundreds of thousands of people in several cities – particularly in Leipzig – continued to grow. On October 7, Soviet leader Mikhail Gorbachev visited Berlin to celebrate the 40th anniversary of the establishment of East Germany and urged the East German leadership to pursue reform, without success.

On October 18, Erich Honecker was forced to resign as head of the SED and as head of state and was replaced by Egon Krenz. But the exodus continued unabated, and pressure for political reform mounted. On November 4, a demonstration in East Berlin drew as many as 1 million East Germans. Finally, on November 9, 1989, the Berlin Wall was opened, and East Germans were allowed to travel freely. Thousands poured through the wall into the western sectors of Berlin, and on November 12, East Germany began dismantling it.

On November 28, West German Chancellor Helmut Kohl outlined a 10-point plan for the peaceful unification of the two Germanies based on free elections in East Germany and a unification of their two economies. In December, the East German Volkskammer eliminated the SED monopoly on power, and the entire Politburo and Central Committee – including Krenz – resigned. The SED changed its name to the Party of Democratic Socialism (PDS) and the formation and growth of numerous political groups and parties marked the end of the communist system. Prime Minister Hans Modrow headed a caretaker government which shared power with the new, democratically oriented parties. On December 7, 1989, agreement was reached to hold free elections in May 1990 and rewrite the East German constitution. On January 28, all the parties agreed to advance the elections to March 18, primarily because of an erosion of state authority and because the East German exodus was continuing apace; more than 117,000 left in January and February 1990.

In early February 1990, the Modrow government's proposal for a unified, neutral German state was rejected by Chancellor Kohl, who affirmed that a unified Germany must be a member of NATO. Finally, on March 18, the first free elections were held in East Germany, and a government led by Lothar de Maiziere (CDU) was formed under a policy of expeditious unification with West Germany. The freely elected representatives of the Volkskammer held their first session on April 5, and East Germany peacefully evolved from a communist to a democratically elected government. Free and secret communal (local) elections were held in the GDR on May 6, and the CDU again won. On July 1, the two Germanies entered into an economic and monetary union.

Settlement

During 1990, in parallel with internal German developments, the Four Powers – the Allies of World War II, being the United States, United Kingdom, France, and the Soviet Union – together with the two German states negotiated to end Four Power reserved rights for Berlin and Germany as a whole. These "Two-plus-Four" negotiations were mandated at the Ottawa Open Skies conference on February 13, 1990. The six foreign ministers met four times in the ensuing months in Bonn (May 5), Berlin (June 22), Paris (July 17), and Moscow (September 12). The Polish Foreign Minister participated in the part of the Paris meeting that dealt with the Polish-German borders.

Of key importance was overcoming Soviet objections to a united Germany's membership in NATO. This was accomplished in July when the alliance, led by President George H.W. Bush, issued the London Declaration on a transformed NATO. On July 16, President Gorbachev and Chancellor Kohl announced agreement in principle on a united Germany in NATO. This cleared the way for the signing in Moscow, on September 12, of the Treaty on the Final Settlement With Respect to Germany – in effect the peace treaty that was anticipated at the end of World War II. In addition to terminating Four Power rights, the treaty mandated the withdrawal of all Soviet forces from Germany by the end of 1994, made clear that the current borders (especially the Oder-Neisse line) were viewed as final and definitive, and specified the right of a united Germany to belong to NATO. It also provided for the continued presence of British, French, and American troops in Berlin during the interim period of the Soviet withdrawal. In the treaty, the Germans renounced nuclear, biological, and chemical weapons and stated their intention to reduce German armed forces to 370,000 within 3 to 4 years after the Conventional Armed Forces in Europe (CFE) Treaty, signed in Paris on November 19, 1990, entered into force.

Conclusion of the final settlement cleared the way for unification of East and West Germany. Formal political union occurred on October 3, 1990, technically executed – not without criticism – via Article 23 of West Germany's Basic Law as the accession of the restored five eastern Lander. On December 2, 1990, all-German elections were held for the first time since 1933. In fact, accession meant that East Germany was annexed by West Germany: the new country kept the name Bundesrepublik Deutschland, used the West German "Deutsche Mark" for currency, and the West German legal system and institutions were extended to the east. Berlin would formally become the capital of the united Germany, but the political institutions remained at Bonn for the time being. Only after a heated 1991 debate did the Bundestag conclude on moving itself and most of the government to Berlin as well, a process that took until 1999 to complete, when the Bundestag held its first session at the reconstructed Reichstag building.

Germany today

In the 2000s Germany has been arguably the centerpiece of the European Union (though the importance of France cannot be overlooked in this connection). The German government was a strong supporter of the enlargement of NATO and the European Union. German troops participate in the multinational efforts to bring peace and stability to the Balkans. The nation is doing fairly well economically, being the world's third-richest economy (nominal GDP) (behind the USA and Japan). It is among the top five countries in Internet access worldwide. Many Germans speak English and/or French, in addition to standard German and their local dialect of German (of which there are many).

Most of the social issues facing European countries in general -- immigration, aging populations straining social-welfare and pension systems -- are important in Germany. Employment is a particularly sensitive subject in present day Germany - figures released in February 2005 showed an unemployment rate of 12.6% of the working age population, or 5.2 million workers, the highest jobless rate since the 1930s.

In 2001 the discovery that the terrorist cell which carried out the attacks against the United States on September 11, 2001 was based in Hamburg, sent shock waves through the country. The government of Chancellor Gerhard Schroder backed the following U.S. military actions, sending a force of Bundeswehr troops to Afghanistan as part of a NATO effort to provide security in that country after the ousting of the Taliban.

Germany adopted a far more skeptical attitude toward America's 2003 invasion of Iraq; many commentators credit the SPD's re-election in autumn 2002 to strong opposition to the impending invasion. Most of the public was strongly against the conflict, and any deployment of troops. After a bitter defeat for the SPD in regional elections in the state of North Rhine-Westphalia (22 May 2005), Chancellor Schroder asked the German Bundestag (lower house of parliament) for a vote of no-confidence. Schroder argued that it had become increasingly difficult to push for the necessary socio-economic reforms because of the opposition majority in the upper house of the parliament, the Bundesrat, as well as the tensions within his own party. After receiving this vote (July 1st), Chancellor Schroder asked the German President, Horst Kohler, to call new national elections.

On 21 July 2005 Federal President Horst Kohler dissolved the parliament, thus agreeing to Chancellor Gerhard Schroder's request, and scheduled early parliamentary elections for September 18. The elections rulted in a stalemate for both major parties, SPD and CDU/CSU, as neither gained enough votes to archive a majority, unless they were to take multiple coalition partners. This was resolved on November 11th 2005, when both parties agreed to form a "Grand Coalition" led by Angela Merkel who became new chancellor of Germany.

Source http://en.wikipedia.org/wiki/History_of_Germany