Allocation of resources to the wartime economy during the war

During the years of war the economy was divided in two; the civil sector and the military sector. The Ministry of Emergency Supply, the Ministry of Foreign Affairs and the Ministry of Traffic and Public Works managed the activities of the civil sector. The Emergency Supply Administration managed all business related to basic supply in the civil sector; acquisition, distribution and all ancillary matters concerning delivery obligations and rationing. The Ministry of Foreign Affairs was responsible for organizing foreign trade. The Ministry of Traffic and Public Works directed the labour force to currently important tasks on the basis of the general duty to work.

Further development of the system in the course of the war and increase of the role of the State

Apart from national emergency supply, civil administration was compelled to perform its wartime tasks practically without any preparation. Quick and fundamental modifications of administration were carried out and new powers were used by virtue of new legislation. The Act on Regulating the Economy under Emergency Conditions, i.e. the Emergency Powers Act entered into force in May 1941. Until its entry into force the economy had been managed by virtue of the State of War Act. By virtue of the new Act the Government was invested with considerable powers to make economic and financial decisions. As a consequence of the Act the entire economy was in fact mobilized for war.

The economy was geared to serve the defence industry and military command

Military aspects were continuously dominant when economic decisions were made. The metal industry was subordinated to the Wartime Economy Staff. In the autumn of 1941 also traffic was subordinated to military command.

At last the system worked well

Apart from the supply crises of 1941-42 and 1944-45 the system as a whole succeeded so well in satisfying civil demands that supplies amounted to 70 – 80 0f the 1938 level and supplies of food even to 90 %.