By the mid-1980s, the Soviet system was faltering. Mikhail Gorbachev, who came to lead the USSR, introduced two landmark reforms: perestroika, an economic restructuring, and glasnost, a policy of openness and transparency. These changes loosened the bonds of the Eastern bloc. In 1989, a cascade of mostly peaceful revolutions swept through the communist world: the Velvet Revolution toppled communism in Czechoslovakia, the Berlin Wall fell in November, and Poland's Solidarity movement, led by Lech Wałęsa, paved the way for free elections. Pope John Paul II, a Polish pontiff who had served since 1978, lent moral authority to these struggles. The following year, East and West Germany reunified on October 3, 1990, and in 1993 Czechoslovakia peacefully split into the Czech Republic and Slovakia in what became known as the Velvet Divorce.
The Soviet Union itself collapsed in December 1991, ending the Cold War and giving birth to fifteen new states. Yet the post-Cold War period was not entirely peaceful. The Yugoslav Wars (1991–2001) saw the violent breakup of Yugoslavia, producing some of the era's worst atrocities, including the 1995 Srebrenica massacre in which Bosnian Serb forces killed roughly 8,000 Bosniak men and boys. In Africa, the 1994 Rwandan Genocide claimed an estimated 800,000 Tutsi lives in a matter of months. Meanwhile, Western Europe moved toward deeper integration: the European Community became the European Union under the Maastricht Treaty in 1993, and the euro entered general circulation on January 1, 2002. In 1997, Britain handed Hong Kong back to China, closing a long chapter of European colonialism. The era's political leaders, including U.S. President Ronald Reagan (1981–1989) and British Prime Minister Margaret Thatcher (1979–1990), reshaped Western politics through free-market policies and a forceful anti-Soviet stance.