Ans/ Germany was vanquished in the First World War. The Versailles Treaty with the Allies was a harsh and humiliating peace. Germany lost its foreign possessions as well as a large portion of its European territory. Germany lost 75% of its iron and 26% of its coal production to France and other nations. Germany was demilitarized by the Allies in order to undermine its authority. Germany was obliged to pay £ 6 billion in compensation. Allied soldiers held the resource-rich Rhineland until the 1920s.