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The politico-economic relationship between Germany and the Balkan states was, from the end of the nineteenth century, one of unequal interdependence. The strategic value of the Balkan states for an export-dependent and resource-dependent industrial state like Germany was manifest in the Berlin-Bagdhad railway project, two world wars and the close relationship with the Federal Republic of Yugoslavia. The region's value to Germany's economic and political elites has been manifest more recently in the wake of Yugoslavia's disintegration and the subsequent transition towards the politico-economic "norms" of the European Union. This paper examines the degree to which it is possible to employ the concept of hegemony in relation to German involvement in the region. While a neo-realist understanding of hegemony is inapplicable, neo-Gramscian conceptions of a hegemonic historic bloc, informed by the interests of Germany's political and economic elites but embedded in the institutions and norms of the EU, are shown to be a valuable tool for explaining the development of the successor states in the western Balkans. The strong presence of German corporations and their affiliates in Balkan trade, in foreign direct investment and transnational infrastructural projects in the region, like the Caspian pipelines, as well as the adoption of German models of political and corporate governance, would seem to confirm the unequal interdependence characteristic of hegemonic relationships. [ABSTRACT FROM AUTHOR]