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BERLIN — In the debate about the possible bankruptcy of the Greek state, one largely dormant argument has resurfaced with increasing frequency: the widespread damage inflicted by the Nazi regime during World War II means that Germany still owes Greece major wartime reparations. While the claims for payment of damages are based on very real facts, one could argue that over the course of 60 years or so, those claims have been satisfied under international law. What is at stake? Without having been provoked, the Wehrmacht — the Third Reich's armed forces — took over both Greece and Yugoslavia on April 6, 1941. In both countries, German soldiers set up a brutal occupation regime. As was usually the case in European nations invaded by the Germans, the high cost of the occupation was borne by the occupied country — and the Greek economy was plundered through forced exports. This resulted in galloping inflation and a radically lower standard of living for Greeks. Additionally, the Third Reich forced the Greek National Bank to lend Hitler's Germany 476 million reichsmarks interest-free. After Germany's surrender, the Allied powers organized the Paris Conference on Reparations in the fall of 1945. Greece laid claim to $10 billion, or half the total amount of $20 billion the Soviets suggested that Germany pay. The suffering caused to Greece by the Nazis is undeniable. Yet at the same time, human suffering cannot really be measured. Independent historians unanimously agree that the total economically measurable damages suffered by Greece as a result of the German occupation, in both absolute numbers as well as proportionate to the population, put Greece in fourth place after Poland, the Soviet Union and Yugoslavia. (Is the Greek bailout falling apart?) At the Paris Conference on Reparations, Greece was finally accorded 4.5% in material German reparation and 2.7% in other forms of reparations. Practically, this meant that Greece received mainly material goods — like machines made in West Germany — worth approximately $25 million, which in today's money amounts to as much as $2.7 billion. However, the stipulations made at the Paris conference were all but irrelevant given that the U.S. opposed heavy economic penalties. U.S. leaders recalled what happened after World War I, when Germany's first democracy, the Weimar Republic, was massively weakened economically by having to pay off reparations. Indeed, one of the consequences of this policy was the rise of Hitler.

All Four Allies Agreed - That is why under the terms of the 1953 London Debt Agreement, reparation payments were put off until a peace treaty was signed. That finally happened in 1990, which didn't require Germany to pay further reparations to other countries like Greece. Greece accepted the treaty, though clearly it had little choice. After decades of partnership with Germany (Greece has been a member of NATO since 1952 and associated with European organizations since 1961), it would have been politically difficult to demand huge reparations — although the issue of compensation was periodically raised by Greek politicians, mostly to score points in domestic politics. (source : Time )