In April 1952, a few months before the signing of the Reparations Agreement between West Germany and Israel, Haaretz correspondent Robert Weltsch reported to the newspaper’s readers on the difficulties in the negotiations between the parties. “The whole problem is more complicated than many thought. The Germans are not going to serve up a heap of dollars on a silver platter. They are willing to pay… They also concede the justness of the Israeli claim despite the absence of an accepted legal basis. But let us not forget that the sums under discussion are enormous. It is easy to steal and destroy, but it is difficult to pay such sums by normal means.” Weltsch covered for Haaretz’s readers the lengthy, convoluted and grueling negotiations between Israel and Germany, directly from Wassenaar in the Netherlands, where the sides met.

The road to the signing of the reparations agreement was far from easy. The initial talks opened in April 1951 with an informal secret meeting between representatives of the Israeli government and West German Chancellor Konrad Adenauer. In September the chancellor made an official statement on the matter in the Bundestag – and thereby paved the way to launching negotiations.

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Not everyone welcomed the agreement in the works. Leading the opposition was Menachem Begin, chairman of the Herut party and future prime minister of Israel. Begin delivered a harsh speech at a huge and violent demonstration in Jerusalem on January 7, 1952 (pictured). “This will be a war of life or death… You will not vanquish us, because there is no force in the world that can vanquish the Irgun soldiers… This government, which will open negotiations with the murderers who annihilated our people, will be a malicious government that bases its rule on spear and grenade,” he said.

Begin called on citizens to refrain from paying taxes and to engage in civil disobedience, even at the cost of being taken to a “concentration camp,” as he put it. Haaretz described the Knesset plaza, where the rally took place, as “a battlefield.” Begin maintained his harsh tone also from the Knesset podium, when he called prime minister David Ben-Gurion a “fascist” and “hooligan.”

The Israeli delegation members did not conceal their aversion to their German interlocutors. Some refused to shake hands with the members of the West German delegation during the negotiations. The creative solution was the brainchild of someone in Ben-Gurion’s security detail, who suggested using a big room and placing an enormous table in it, minimizing contact between the two sides.

But in the end the parties reached an understanding. On September 10, 1952, Israeli Foreign Minister Moshe Sharett and Chancellor Adenauer signed the reparations agreement in Luxembourg. Under this agreement, West Germany transferred to Israel goods worth 3.45 billion deutsche marks (approximately $845 million) and acknowledged its responsibility for the genocide of the Jewish people and damage to property and life. It also undertook to personally compensate citizens persecuted by the Nazis.

German reparations enabled the state of Israel to build an infrastructure of roads, railways, shipping and industry, at a time when it was suffering from a severe shortage of foreign currency and of basic goods such as sugar and fuel. In the meantime the population of the young state doubled every three years. Today, 61 years later, not many people would dispute the fact that the agreement was one of the most important events in the history of the state, one that enabled Israel to get up on its feet and start moving forward.

Along with its weighty material and emotional aspects, the agreement also constituted a legal novelty: It was signed between two countries that did not exist at the time to which it refers – Israel, which was founded three years after World War II ended, and West Germany, which was founded in 1949 as the Federal Republic of Germany. The document also encompassed a third party – the Jewish people. This was also the first agreement in which a country that was defeated in war undertook to transfer personal compensation to the casualties of that war.

At the same time, an organization called the Claims Conference was established to represent world Jewry in future negotiations with the German government. Made up of 24 Jewish organizations (representatives of Holocaust survivors, public figures and the Israeli government), the conference still meets annually with German government representatives to discuss the amount of compensation Germany will transfer to survivors. To date it has transferred some $70 billion. At the most recent meeting last month in Jerusalem, Germany undertook payment of an additional $1 billion over the next three years.