Nazi–Soviet economic relations (1934–41)

After the Nazis rose to power in Germany in 1933, relations between Germany and the Soviet Union began to deteriorate rapidly, and trade between the two countries decreased. Following several years of high tension and rivalry, Nazi Germany and the Soviet Union began to improve relations in 1939. In August of that year, the countries expanded their economic relationship by entering into a commercial agreement whereby the Soviet Union sent critical raw materials to Germany in exchange for weapons, military technology and civilian machinery. That deal accompanied the Molotov–Ribbentrop Pact, which contained secret protocols dividing central Europe between them, after which both Germany and the Soviet Union invaded countries listed within their "spheres of influence".

The countries later further expanded their economic relationship with a larger commercial agreement in February 1940. Thereafter, Germany received significant amounts of critical raw materials necessary for its future war efforts, such as petroleum, grain, rubber and manganese, while sending weapons, technology and manufacturing machinery to the Soviet Union. After unresolved negotiations regarding a potential Soviet entry into the Axis Pact, the countries settled several disputes and further expanded their economic dealings with the January 1941 German–Soviet Border and Commercial Agreement.

Economic relations between the two countries were abruptly terminated when Germany invaded the Soviet Union in June 1941, in violation of the Molotov–Ribbentrop Pact.

Germany lacks natural resources, including several key raw materials needed for economic and military operations. Since the late 19th century, it had relied heavily upon Russian imports for such materials. Before World War I, Germany had annually imported 1.5 billion Reichsmarks of raw materials and other goods from Russia. However, the economies of the two countries differed greatly before World War I. Germany had grown into the second-largest trading economy in the world, with a highly skilled workforce largely dominated by the private sector. While Imperial Russia had rapidly modernized by tenfold in the fifty years before the war, its economy still relied heavily upon state orders and its industry was closely regulated by the Tsarist state.

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