Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: SATURDAY, May 19, 1990                   TAG: 9005190268
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A-1   EDITION: METRO 
SOURCE: The Washington Post
DATELINE: BONN, WEST GERMANY                                LENGTH: Medium

TREATY STARTS UNIFICATION IN GERMANY/ MERGER OF CURRENCIES FIRST STEP

In a festive ceremony at the desk of the first West German chancellor, Konrad Adenauer, the two German finance ministers signed a 114-page document that in many ways spells the end of East Germany's four decades of separate existence.

"What we are experiencing here is the birth of the free and united Germany," West German Chancellor Helmut Kohl said before stepping onto the terrace of Bonn's Schaumburg Palace to sip German sparkling wine with East German Prime Minister Lothar de Maiziere.

The unification of the two Germanys' currencies, economies and social security systems - all of which is to happen July 1 - makes the complete merger of the countries "irreversible," de Maiziere said at the ceremony, which was televised live in both Germanys.

The treaty details the legal changes involved when West Germany takes control of everything from banking to how much the East German government can spend. East Germans will give up the nearly worthless currency of their ousted Communist rulers in exchange for the West German mark, their ticket to the consumer society. East Germans will pay West German taxes, get West German unemployment checks and buy largely West German goods.

Calling the treaty both a "great work" and a "compromise," de Maiziere counseled East Germans to accept that their country had to give up its independence. Only hours before the treaty was signed, de Maiziere relented on one of his most steadfast positions, agreeing to let Western investors buy East German land and buildings.

"No one should forget what the East German mark would really be worth in a free market," the prime minister said. "We could not and cannot continue as before." Indeed, he said, "which country in Eastern Europe will get as good a start as we do with this treaty?"

De Maiziere's appeal stems from rising concern that East Germans are souring on the economic union, which threatens to put as many as a quarter of the country's workers out of work and bankrupt many East German businesses.

"I fear the worst," said East German Labor Minister Regine Hildebrandt. East Germany already has asked Bonn to be prepared to send riot police to the East on the day of monetary union. "The new economic order is coming without any transition," Hildebrandt said. "Our society is not prepared."

Unification is also wearing out its welcome in the West, where concern about the cost of absorbing the East was reflected in two local election defeats of Kohl's party last week. Bonn this week set up a Unity Fund that expects to spend about $70 billion over the next five years to pay for unification.

De Maiziere urged Germans on both sides to reject criticism that East Germany has given up too much. "I find it astounding that in some parts of Germany there are more fears than hopes," he said. "Too many here stand faint-hearted before the undeniable mountain of problems."

The treaty goes before the East German legislature in a special session Monday. The West German lower house, the Bundestag, is expected to ratify it next week. Bonn's upper house will not be able to consider the document until late June, about 10 days before the two currencies are to merge.