Poland and Lithuania, the new direct neighbours, protected their markets from German agricultural products by way of high customs duties and ceased being important sales markets. Trade with former Russia collapsed due to revolution, civil war and systemic change.
Conversely, imports of important craft and industrial goods, especially coal, fertiliser and machinery, became more expensive. Due to the locational disadvantages, higher interest was charged for loans in the province than in the rest of the Reich. It was not only agriculture that was in economic distress.
To promote trade, the "Deutsche Ostmesse" (German eastern trade fair) was established in Königsberg in 1920. Several state measures served as "Osthilfe" (Eastern Aid) from 1926 onwards to relieve the debts of agricultural enterprises and helped to distribute land of unprofitable estates to small farmers. The influential large landowners benefitted particularly from the subsidies. This injustice contributed to political radicalisation and rejection of the old elites.
Illustration:
Reich President Friedrich Ebert opened the first "Ostmesse" (eastern trade fair) in Königsberg in 1920, which soon became – after Leipzig – the most important trade fair in Germany.
Photo: District community Königsberg