Time Slip Reiwa Japan

A.D.1937 - 041 - German Machinations

After providing volunteer troops and supplies to the Soviet Union and Spain, Germany faced a problem that could not be overlooked: the depletion of the national treasury. Due to the hostile policies of the G4 – mainly France – Germany's economy was weak, especially as it was in a position where it was difficult to stimulate economic activity outside of Europe.

The economic policies of Hitler's regime led to a dramatic increase in employment, but the lack of economic scale did not lead to higher wages or increased consumer activity. Therefore, tax revenues did not increase and the national treasury remained in a difficult situation. Under these circumstances, the cooperation with the Soviet Union and Spain, which consumed foreign currency, weighed heavily on Germany.

Although the shortage of resources was relieved by imports from the Soviet Union, *1 Germany had a serious shortage of foreign currency. This led Germany to look for ways to sell its industrial products to non-G4 countries. China was the biggest buyer, followed by South American countries.

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China

The anti-American momentum of the Chinese people, sparked by the Chinese Communist Party, was unabated. In many parts of China, ordinary Americans were increasingly subjected to crime. As a result, the US government called on its citizens to refrain from activities outside the Frontier Republic, Shanghai and Hong Kong. As a result, the number of American products distributed in mainland China decreased.

In order to fill this gap, Germany launched an export offensive against China. Since the relationship between Germany and China had been good from the beginning, China purchased a large number of German-made tanks and fighter planes in anticipation of the war against the United States. *2

Germany was aware that its own Panzer III had an advantage over the American M2 tank in attack power and mobility, but was at a slight disadvantage in armor, and proposed an improved version of the Panzer III to China, the Panzer III Ausf C. It was a model with a reinforced engine and chassis, and reinforced armor on top of that. With a weight of 29 tons, 4 tons more than the Ausf A, the Panzer III Ausf C was nerve-wracking to operate on slopes, but the sales pitch that it was a new and improved tank based on the lessons learned in the Siberian War of Independence captured the hearts of China.

In addition, the Panzer III Ausf C, which looked strong even from the outside, was a favorite of the Chinese. In the end, China ordered as many as 400 Panzer III Ausf C tanks from Germany. It was decided that 200 would be imported as finished products from Germany, 100 would be shipped to China for assembly, and the last 100 would be manufactured in China. It was also agreed between Germany and China that further purchase contacts would be concluded depending on operational performance.

At the same time, a military advisory group was invited from Germany, and China would devote all its energy to the training of its armored forces. At this point, the Frontier Republic only had enough tanks for two tank brigades of the Frontier Republic Army and the US Mechanized Division, over 200 tanks. The Chinese were calculating that they could win if they hit them with twice as many tanks.

In addition, in order to secure air superiority, China placed a large order with Germany for fighter planes. The lessons of the Siberian War of Independence, brought to China via Germany, had made China aware of this threat. No matter how large the number of tanks, if they were crushed from the air, it would be meaningless—the Soviet army had suffered enough damage from aircraft to make them think that. Germany agreed to sell China fighter planes equipped with the latest 100 horsepower water-cooled engines.

. . .

Germany

Germany's economy was not small enough to make up for the shortage in the national treasury by trading with China. This led Hitler to make a decision to take control of Central Europe. Even if Poland, which made no secret of its hostile actions against Germany, was not possible, annexing Austria and neighboring countries would allow the German economy to take a breather by seizing the assets in the central banks of those countries. On top of that, the German economy would have access to workers.

Initially, a partnership with Turkey was thought to be a possible source of workers, but that idea was scrapped when German got close to the Soviet Union. This led them to Central Europe, the Middle East, and South America.

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Central Europe

The anti-German solidarity movement, spearheaded by France and Poland, did not have a significant impact on Austria and Czechoslovakia, which were Germany's backyard. Instead, the political instability caused by the World War led to the rise of fascism and a feeling of closeness to Germany, which led to a return to Greater Germanism.

Hitler took advantage of this situation. Despite the risk of war with France and Poland, the foreign currency and gold held by the central banks of Central European countries were too attractive for Germany, which was suffering from a shortage of foreign currency. Germany will deepen its propaganda for the great unity of Greater Germanism and the establishment of a Germanic sphere of existence.

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Middle East

Germany's response to Britain's soft landing in the Middle East was to act in direct opposition to the independence movement. It secretly contacted pro-independence groups in various regions to help them study in Germany, and it also arranged jobs in Germany for brain workers and ordinary workers alike.

In addition, they were also involved in the clandestine sale of arms. The main items were small arms, but some of them were even tanks. These were mixed in with exports to Italian East Africa to deceive the British. The land in the Middle East was already well-lubricated by Japanese oil demand, so it became a good source of money for Germany. At this point, Britain was only aware of the increasing number of students studying in Germany, and was unaware of the German plot.

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South America

Germany's main target as a source of funds was Venezuela, which was under a military dictatorship. Venezuela was basically pro-US, but by bribing the leaders of the regime, they were able to force them to adopt a conciliatory policy toward Germany. In addition, they promised to sell the latest weapons, such as tanks and armored vehicles, without hesitation.

The US had South America as its backyard, but because of this, it was cautious about selling weapons that could undermine the stability of the region. This backfired and allowed Germany and Venezuela to get closer. Germany used its access to Venezuela as a foothold to reach out to the former fascist regime in Argentina.

Argentina had been placed in a position similar to that of a British vassal state due to a combination of internal political turmoil and diplomatic failures, and it took advantage of the dissatisfaction of its people and military.

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Notes

*1: Trade between Germany and the Soviet Union was effectively a barter trade. The Soviet Union imported mineral resources and crude oil in exchange for the industrial power and industrial products it needed. The Soviet Union had strong domestic demand due to the development of heavy industry, but ironically, the loss of the area east of Siberia reduced its resource consumption, so it was able to meet German demand.

*2: The Chinese Communist Party's instigation had led them to have one thought in common, that the glory of China would be restored only when the Americans were expelled from Manchuria, the land of the Chinese. The other G4, especially the Japanese who did not respect China even though they were Asians and should have been included in the Chinese hierarchy, were hateful enemies. And the US, Britain, and France, which were encroaching on China's land, were the enemies. These four nations were given the derogatory nickname "the four barbarians", meaning those who disturbed the Chinese order. At the same time, the Chinese government propagandized that Germany was a friendly country and a virtuous, if not subordinate, member of the Chinese hierarchy.