Schmidt helped shape modern Germany in tumultuous decade

Former German Chancellor Helmut Schmidt smokes during a ceremony marking the 50th anniversary of the Bergedorfer Forum of the Koerber Foundation in Berlin, in this September 9, 2011 file photo. [Photo/Agencies]

BERLIN- Former West German Chancellor Helmut Schmidt was one of the founding fathers of the euro.

Schmidt, who died on Tuesday aged 96, was West Germany's second centre-left Social Democrat (SPD) chancellor from 1974 to 1982, at the height of the Cold War, after serving as finance minister from 1972 to 1974.

More popular as an elder statesman than he had been as chancellor, in later life he became a frequent guest on talk shows, opining on world affairs through a thick cloud of cigarette smoke.

This year he shocked Germans, however, by admitting that he had had an extra-marital affair decades earlier.

As chancellor, Schmidt extended West Germany's influence in NATO and Europe as he balanced close ties with the United States with some conciliatory gestures towards communist East Germany.

As finance minister, Schmidt steered West Germany through a series of global currency crises caused by a weakened dollar and the first oil price explosion. He became chancellor after Willy Brandt resigned when a close aide was unmasked as a Communist East German spy.

Under his stewardship, West Germany continued to enjoy the 'Economic Miracle' and reap the rewards of rebuilding an economy shattered by World War Two but the situation deteriorated during his time in office and he tried to make modest welfare cuts.

Many will remember him best for his handling of the left-wing RAF urban guerrillas, also known as the Baader-Meinhof Gang, whose assault on the political and business establishment peaked in the "Deutsche Herbst" (German Autumn) of 1977 when the group kidnapped Employers' Federation head Hanns-Martin Schleyer to demand the release from prison of several RAF members.