As Europe's largest economy and most populous nation, Germany remains
a key member of the continent's economic, political, and defense
organizations. European power struggles immersed Germany in two
devastating World Wars in the first half of the 20th century and
left the country occupied by the victorious Allied powers of the
US, UK, France, and the Soviet Union in 1945. With the advent of
the Cold War, two German states were formed in 1949: the western
Federal Republic of Germany (FRG) and the eastern German Democratic
Republic (GDR). The democratic FRG embedded itself in key Western
economic and security organizations, the EC, which became the EU,
and NATO, while the Communist GDR was on the front line of the Soviet-led
Warsaw Pact. The decline of the USSR and the end of the Cold War
allowed for German unification in 1990. Since then, Germany has
expended considerable funds to bring Eastern productivity and wages
up to Western standards. In January 1999, Germany and 10 other EU
countries introduced a common European exchange currency, the euro.