War reparations

War reparations are payments intended to cover damage or injury inflicted during a war. Generally, the term war reparations refers to money or goods changing hands, but not to the annexation of land.

History

Making the defeated party pay a war indemnity is a common practice with a long history.

In ancient times, the imposition of reparations on a defeated enemy was often the beginning of forcing that enemy to pay a regular tribute.

Rome imposed large indemnities on Carthage after the First and Second Punic Wars.

Some war reparations induced changes in monetary policy. For example, the French payment following the Franco-Prussian war played a major role in Germany's decision to adopt the gold standard. The 230 million silver taels in reparations imposed on defeated China after the Sino-Japanese War led Japan to a similar decision.

Europe

Following the Greco-Turkish War (1897), defeated Greece was forced to pay a large war indemnity to Turkey (£4 million). Greece, which was already in default, was compelled to permit oversight of its public finances by an international financial commission.