On November 11, 1918, a depleted Germany agreed to an armistice in what was then known simply as the Great War, putting a merciful end to four years of conflict that killed some 10 million soldiers and left 21 million more wounded. The legacy of the First World War didn't end there, however, nor did it end seven months later, when a formal peace treaty was signed in the glittering Hall of Mirrors in Versailles, France. The Versailles Treaty required Germany to acknowledge its guilt in causing the war, and to pay hefty economic reparations in compensation for the losses and damages of the Allies. Widespread hatred of the treaty in Germany helped fuel the rise of Adolf Hitler, whose unchecked aggression led directly to a second devastating world war just three decades later.

Now, almost 92 years after the armistice was signed, the last chapter of World War I has finally come to an end. As reported by the British newspapers the Telegraph and the Daily Mail, Germany made its final reparations payment of £59.5 million (or around $94 million) on October 3, 2010. According to Germany's best-selling newspaper, Bild: "On Sunday the last bill is due and the First World War finally, financially at least, terminates for Germany." Most of the money will go to private individuals, corporations and pension funds that own long-term bonds agreed upon under the Treaty of Versailles.

A Controversial Treaty

The Treaty of Versailles was controversial from the beginning. When Germany asked for a general armistice in October 1918, it did so on the basis of U.S. President Woodrow Wilson's famous Fourteen Points, which laid out the terms of what he called a "peace without victory." Once treaty negotiations began, however, the other Allied nations—especially France, whose land and people had been decimated by the war—argued strongly that Germany should be punished for its role in the war, and that the country should never again be allowed to pose a military threat to the rest of Europe.

The final version of the Versailles Treaty, signed on June 28, 1919, demanded that Germany accept responsibility for the war and ordered the country to pay 226 billion Reichsmarks (later reduced to 132 billion, the equivalent of $33 billion at the time) in reparations. Germany's leaders were disillusioned by the treaty proceedings, and the entire cabinet quit in protest at one point in the spring of 1919. They weren't the only ones: John Maynard Keynes, representative of the British Treasury, had resigned from the conference in frustration, warning that "Germany will not be able to formulate correct policy if it cannot finance itself."

Another War

True to Keynes' predictions, a crippled economy—exacerbated by the harsh terms imposed in Versailles—hampered Germany's transition from a monarchy to a democracy in the post-war years, as Germans turned against the leaders that had agreed to such a hateful peace. Public opinion in Britain and the United States in the post-war years also came to view the treaty as unfair to Germany, and two acts of legislation—the Dawes Plan (1924) and the Young Plan (1929)—drastically reduced the country's reparations burden. Germany's economic woes reached a new low after the Great Stock Market Crash of 1929, and the Lausanne Conference of 1932 formally suspended all repayments. Still, Hitler's National Socialist (Nazi) Party was able to channel hatred of the treaty into a powerful groundswell of support. After becoming chancellor in 1933, Hitler consistently defied the military and territorial restrictions imposed on Germany at Versailles, eventually leading to the outbreak of World War II in 1939.

At a conference in London in 1953, the new West Germany—but not communist East Germany—took on the responsibility of paying Germany's remaining war debts incurred before World War II (including a much reduced amount of the reparations assigned at Versailles). The balance was settled by 1980, but a clause in the London Debt Agreement had mandated that the interest on the sizeable foreign loans taken out by Germany during the Weimar Republic era (after the First World War) must be repaid if Germany were ever reunited. The country began making these payments in 1996, and the last bill is due on Sunday, October 3—the anniversary of German reunification—bringing an end to a complicated and tragic chapter in the history of Germany, Europe and the world.