Study finds captives traded for oil in former East Germany

BERLIN (Reuters) - Political prisoners in former East Germany were traded for oil, copper and silver in the 30 years before reunification and human trade with the West formed a lucrative economic linchpin, the author of a new study said.

From 1963-1990, the West German government paid a total of 3.44 billion Deutsche Marks, roughly 1.8 billion euros ($2.62 billion), in goods for the release of nearly 32,000 prisoners and 2,000 children from the communist East.

German historian Matthias Judt, who spent months scouring records of state bank accounts, has discovered that the goods were traded on international commodity markets with profits mainly used to service debt in the stricken East German economy.

"It was a very safe and secure business for them," Judt, at the Potsdam Centre for Research on Contemporary History, told Reuters. "It is a deal where you are selling a person and getting money out of it. And no one talked about it."

The bribe money was supposed to be used for purchasing Western consumer goods for East Germans, but only 11 percent of the money was used in this way according to Judt.

"There is this myth around it -- you can see in a lot of literature that people who were involved in this business said goods were delivered in order to supply the population. It is not right to continue with that myth," he said.

The only money spent on consumer goods was in 1966 and 1969 on cocoa beans and around one in five deals made through the East German department for commercial coordination involved the trade of prisoners, Judt said.

One of the first transactions took place in 1962 when the Protestant church struck a bargain to free 15 employees held in the East. The church often acted as an intermediary between bribe payers and businesses on both sides of the Wall.

In 1963 the Western federal government organised for 350,000 Deutsche Marks (roughly 180,000 euros) of bribes to be handed over at Berlin's Friedrichstrasse rail station in a suitcase.

It was this cloak-and-dagger cash deal which prompted authorities to set up a more efficient platform for human trade, according to Judt. "They came up with the idea that they would give goods and they administered special bank accounts."

One account, controlled on behalf of East German leader Erich Honecker, served as the basis of Judt's study, 'Prisoners for Bananas,' which was published in the German Quarterly Journal for Social and Economic History this month.

Money garnered from the final transaction, just before the fall of the Berlin Wall in 1989, was spent on bananas at the West German government's request, who said it had to be spent on exotic fruit for the benefit of the East German public.