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The German Democratic Republic, informally known in English as East Germany, was a state within the Eastern Bloc during the Cold War period. From 1949 to 1990 it governed a region of Germany which was occupied by Soviet forces at the end of the Second World War — the Soviet Occupation Zone of the Potsdam Agreement, bounded on the east by the Oder-Neisse line. The Soviet zone surrounded West Berlin, but did not include it; as a result, West Berlin remained outside the control of the GDR. Soviet occupation authorities began transferring administrative responsibility to German communist leaders in 1948, and the GDR began to function as a state on 7 October 1949. Soviet forces however remained in East Germany throughout the Cold War, and in 1953 they helped the GDR police to suppress a popular uprising. Until 1989, political power in the GDR was monopolized by the Soviet-backed communist party, the Socialist Unity Party of Germany (SED). Other parties could only function within the SED-dominated National Front of Democratic Germany. The Stasi security force was used to repress dissent. The economy was centrally planned, and predominantly state owned. A subsidy system was used to keep down the prices of a large range of basic goods and services. Although the GDR had to pay substantial war reparations to the USSR, it became the richest economy in the Eastern Bloc. Nonetheless it did not match the economic growth of West Germany. Emigration to the West was a significant problem — as many of the emigrants were young well-educated people, it further weakened the state economically. The government tried to stop people leaving by fortifying its western borders and in 1961 by establishing the Berlin Wall. Several hundred people were killed by border guards. In 1989, a peaceful revolution in the GDR led to the destruction of the Berlin Wall and emergence of a government committed to democratization. The following year, free elections were held, and international negotiations led to the signing of the Final Settlement treaty on the status and borders of Germany. The GDR was dissolved and Germany was reunited on 3 October 1990.
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