Haavara Agreement

The Trust and Transfer Office “Haavara” Ltd. places at the disposal of the Banks in Palestine amounts in Reichmarks which have been put at its disposal by the Jewish immigrants from Germany. The Banks avail themselves of these amounts in Reichmarks in order to make payments on behalf of Palestinian merchants for goods imported by them from Germany. The merchants pay in the value of the goods to the Banks and the “Haavara” Ltd. pays the countervalue to the Jewish immigrants from Germany. To the same extent that local merchants will make use of this arrangement, the import of German goods will serve to withdraw Jewish capital from Germany.

The Haavara Agreement (transfer agreement) was an agreement between Nazi Germany and Zionist German Jews signed on 25 August 1933. The agreement was finalized after three months of talks by the Zionist Federation of Germany, the Anglo-Palestine Bank (under the directive of the Jewish Agency) and the economic authorities of Nazi Germany. It was a major factor in making possible the migration of approximately 60,000 German Jews to Palestine in 1933–1939.

Baron Edmond de Rothschild, was the “father” of Palestine colonisation. It was Joseph Feinberg, the leader of the pioneers in Rishon-Le-Zion, the first of the Jewish colonies in Palestine, who obtained 50,000 francs from the Baron to enable the settlers to overcome their difficulties. Society received generous financial and moral help from the Baron in the establishment of the important colonies of Petach Tikvah, Zichron Jacob, Hederah, Rosh Pinah, Yesod Ha’ Ma’aleh, and most of the older Jewish colonies in Palestine. Over thirty of these colonies were founded with his aid between 1880 and 1895. The administration of the colonies was carried on through the Jewish Colonisation Association (Ica), but it was entirely financed by the Baron. Finally, the Palestine Jewish Colonisation Association (Pica) was created in 1924, under the Presidency of Mr. James de Rothschild, M.P., the Baron’s eldest son, in order to administer the Palestine colonies.

The agreement was designed to enable Jews fleeing antisemitic persecution under the new Nazi regime to transfer some portion of their assets to their refuge in British Mandatory Palestine. It provided some relief for Jews fleeing by allowing them to recover some of the possessions and assets they were forced to surrender before departing. A portion of those possessions could be re-obtained by transferring them to Palestine as German export goods. The agreement was controversial at the time, and was criticised by many Jewish leaders both within the Zionist movement (such as the Revisionist Zionist leader Ze’ev Jabotinsky) and outside it. For German Jews, the agreement offered a way to leave an increasingly hostile environment in Nazi Germany; for the Yishuv, the new Jewish community in Palestine, it offered access to both immigrants and some economic support; and for the Nazis it was seen as a way of breaking the Anti-Nazi boycott of 1933, which had mass support among European Jews and was thought by the German state as a potential threat to a fragile German economy.

Although the Nazis won the greatest share of the popular vote in the two Reichstag general elections of 1932, they did not have a majority, so Hitler led a short-lived coalition government formed by the NSDAP and the German National People’s Party. Under pressure from politicians, industrialists, and the business community, President Paul von Hindenburg appointed Hitler as Chancellor of Germany on 30 January 1933. This event is known as the Machtergreifung (seizure of power). In the following months, the NSDAP used a process termed Gleichschaltung (co-ordination) to rapidly bring all aspects of life under control of the party. All civilian organisations, including agricultural groups, volunteer organisations, and sports clubs, had their leadership replaced with Nazi sympathisers or party members. By June 1933, virtually the only organisations not in the control of the NSDAP were the army and the churches.

Within the Nazi party, a variety of “solutions” to the “Jewish problem” were proposed, including expulsion and the encouragement of voluntary emigration. Active persecution of German Jews began as soon as the Nazis were in power, embodying the genocidally antisemitic programme outlined by Hitler long before. For example, on 1 April, the Nazis organized a nationwide boycott of Jewish-owned businesses in Germany; under the Law for the Restoration of the Professional Civil Service which was implemented on 7 April, Jews were excluded from the civil service; on 25 April, quotas were imposed on the number of Jews in schools and universities. Jews outside Germany responded to these persecutions with a boycott of German goods, which caused concern among the Nazis because of their exaggerated understanding of Jewish economic power.

Meanwhile, in Mandatory Palestine, a growing Jewish population (174,610 in 1931, rising to 384,078 in 1936) was acquiring land and attempting to develop the agricultural economy.

Hanotea company

Transfer agreement used by the Palästina Treuhandstelle (Palestine Trustee Office), established specifically to assist Jews fleeing the Nazi regime to recover some portion of the assets they had been forced to surrender when they fled Nazi Germany.

Hanotea (the Planter) was a citrus planting company based in Netanya and established in 1929 by long-established Jewish settlers in Palestine involved in the Benei Binyamin movement. In a deal worked out with the Reich Economics Ministry, the blocked German bank accounts of prospective immigrants would be unblocked and funds from them used by Hanotea to buy agricultural German goods; these goods, along with the immigrants, would then be shipped to Palestine, and the immigrants would be granted a house or citrus plantation by the company to the same value. Hanotea’s director, Sam Cohen, represented the company in direct negotiation with the Reich Economics Ministry beginning in March 1933. In May 1933, Hanotea applied for permission to transfer capital from Germany to Palestine. This pilot arrangement appeared to be operating successfully, and so paved the way for the later Haavara Agreement.

The Transfer Agreement

CERTIFICATE
The Trust and Transfer Office “Haavara” Ltd. places at the disposal of the Banks in Palestine amounts in Reichmarks which have been put at its disposal by the Jewish immigrants from Germany. The Banks avail themselves of these amounts in Reichmarks in order to make payments on behalf of Palestinian merchants for goods imported by them from Germany. The merchants pay in the value of the goods to the Banks and the “Haavara” Ltd. pays the countervalue to the Jewish immigrants from Germany. To the same extent that local merchants will make use of this arrangement, the import of German goods will serve to withdraw Jewish capital from Germany.
The Trust and Transfer Office,
HAAVARA, LTD.
— Example of the certificate issued by Haavara to Jews emigrating to Palestine

The Haavara (Transfer) Agreement, negotiated by Eliezer Hoofein, director of the Anglo-Palestine Bank, was agreed to by the Reich Economics Ministry in 1933, and continued, with declining German government support, until it was wound up in 1939. Under the agreement, Jews fleeing persecution in Nazi Germany could use some of their assets to purchase German manufactured goods for export, thus salvaging some part of their personal wealth during emigration. The agreement provided a substantial export market for German factories in British-ruled Palestine. Between November, 1933, and December 31, 1937, 77,800,000 Reichmarks, or $22,500,000, (values in 1938 currency) worth of goods were exported to Jewish businesses in Palestine under the program. By the time the program ended with the start of World War II, the total had risen to 105,000,000 marks (about $35,000,000, 1939 values).

Emigrants with capital of £1,000, (about $5,000 in 1930s currency value) could move to Palestine in spite of severe British restrictions on Jewish immigration under an Immigrant investor program similar to the contemporary EB-5 visa. Under the Transfer Agreement, about 39% of an emigrant’s funds were given to Jewish communal economic development projects, leaving individuals with about 43% of the value of whatever assets they were able to transfer out of Germany after administrative and shipping costs.

The Haavara Agreement was thought among some Nazi circles to be a possible way to rid the country of its supposed “Jewish problem.” The head of the Middle Eastern division of the foreign ministry, the anti-Nazi Werner Otto von Hentig, supported the policy of concentrating Jews in Palestine. Hentig believed that if the Jewish population was concentrated in a single foreign entity, then foreign diplomatic policy and containment of the Jews would become easier. Hitler’s own support of the Haavara Agreement was unclear and varied throughout the 1930s. Initially, Hitler criticized the agreement, but reversed his opinion and supported it in the period 1937-1939.

After the German invasion of Poland in September 1939, the “basis of its existence [was] removed”, and the program was ended.

Responses

The agreement was controversial both within the Nazi party and in the Zionist movement. As historian Edwin Black put it, “The Transfer Agreement tore the Jewish world apart, turning leader against leader, threatening rebellion and even assassination.” Opposition came in particular from the mainstream US leadership of the World Zionist Congress, in particular Abba Hillel Silver and American Jewish Congress president Rabbi Stephen Wise. Wise and other leaders of the Anti-Nazi boycott of 1933 argued against the agreement, narrowly failing to persuade the Eighteenth Zionist Congress in August 1935 to vote against it.

The right-wing Revisionist Zionists and their leader Vladimir Jabotinsky were even more vocal in their opposition. The Revisionist newspaper in Palestine, Hazit Haam published a sharp denunciation of those involved in the agreement as “betrayers”, and shortly afterwards one of the negotiators, Haim Arlosoroff was assassinated.

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