The Soviet Union, CMEA, and the Energy Crisis of the 1970s

2020 ◽  
Vol 22 (4) ◽  
pp. 4-30
Author(s):  
Michael De Groot
Keyword(s):  
Soviet Union ◽  
Middle Eastern ◽  
World Market ◽  
Balance Of Payments ◽  
Economic Assistance ◽  
Market Prices ◽  
East European ◽  
The Soviet Union ◽  
Mutual Economic Assistance ◽  
Oil Crisis

Numerous scholars have claimed that the Soviet Union was a primary beneficiary of the 1973–1974 oil crisis. Drawing on archival evidence from Russia and Germany, this article challenges that interpretation, showing that the oil crisis forced Soviet policymakers to confront the limits of their energy industry and the effects of the crisis on their East European allies. Demand for Soviet energy outpaced production, forcing Soviet officials to weigh their need to compensate for economic shortcomings at home against their role as the guarantor of Communist rule in Eastern Europe. The Soviet decision to raise prices within the Council on Mutual Economic Assistance (CMEA) and the Soviet Union's inability to fulfill demand across CMEA compelled the East European governments to purchase oil from Middle Eastern countries at increasing world market prices, crippling their balance of payments and accentuating their other economic shortcomings.

CMEA: effective but cumbersome political economy

1986 ◽  
Vol 40 (2) ◽  
pp. 287-327 ◽  
Author(s):  
Michael Marrese
Keyword(s):  
Soviet Union ◽  
Political Stability ◽  
Economic Assistance ◽  
Economic Costs ◽  
Short Term ◽  
East European ◽  
The Soviet Union ◽  
Mutual Economic Assistance ◽  
Over Time

The Council for Mutual Economic Assistance is primarily a forum for bilateral bargaining between the Soviet Union and each of the other CMEA countries. The bilateral negotiations are conducted with tremendous concern for Soviet long-term preferences and for the short-term economic-political stability of East European countries. The CMEA provides the Soviet Union with an effective but cumbersome politico-economic policy-making apparatus that is becoming less effective and increasingly cumbersome over time. From the East European perspective, the CMEA tends to solidify the positions of the East European leaders yet generate long-term economic costs. What are the preferences upon which the CMEA is constructed? How are CMEA characteristics related to these preferences? What are the economic costs and benefits to member countries in static and dynamic terms? Why have costs for all member countries risen over time? How is intra-CMEA trade likely to change during the next decade?

Interpreting the Soviet subsididzation of Eastern Europe

1988 ◽  
Vol 42 (4) ◽  
pp. 639-658 ◽  
Author(s):  
Josef C. Brada
Keyword(s):  
Soviet Union ◽  
Eastern Europe ◽  
Raw Materials ◽  
The Other ◽  
Economic Assistance ◽  
Gains From Trade ◽  
East European ◽  
The Soviet Union ◽  
Mutual Economic Assistance ◽  
Trading Scheme

In trade among the members of the Council for Mutual Economic Assistance (CMEA), prices of raw materials are lower and those of manufactured goods higher than comparable world prices. Because the Soviet Union is a net exporter of raw materials to, and net importer of manufactures from, the other CMEA countries, it benefits less from CMEA trade than it would from trading with the rest of the world, and the other CMEA members benefit more. This redistribution of the gains from trade is generally seen as a form of subsidization. One explanation of these subsidies is that they represent Soviet payments for political and military benefits provided by East European regimes; another is that the subsidies compensate Eastern Europe for the economic burden imposed by central planning and extensive economic ties to the Soviet Union. I argue that neither of these explanations is consistent with the type of economic and political relations that one would expect of the Soviet and East European regimes. In their place I offer an alternative explanation based on the Heckscher-Ohlin model of comparative advantage. The distribution of CMEA subsidies is shown to reflect the distribution of gains from trade that would arise among any group of economies forming a preferential trading scheme. I also argue that the willingness of members to belong to CMEA, even at the expense of paying subsidies, is that CMEA can be viewed as a club that provides benefits to members while imposing costs that may to some extent be unequal and unpredictable.

Energy in East Europe Through 1980

1974 ◽  
Vol 96 (3) ◽  
pp. 292-306
Author(s):  
V. V. Strishkov ◽  
G. Markon ◽  
Z. E. Murphy
Keyword(s):  
Soviet Union ◽  
Eastern Europe ◽  
Energy Output ◽  
Economic Assistance ◽  
Industrial Countries ◽  
East Europe ◽  
The Soviet Union ◽  
Mutual Economic Assistance ◽  
Economic Bloc ◽  
Political Economic

Eastern Europe is the world’s largest and most tightly knit multinational economic bloc. It is largest in population although its per capita energy output and industrial production lag considerably behind that of other industrial countries. Originally comprised of eight Soviet satelite states welded together by a common political-economic system patterned after that of the Soviet Union, Eastern Europe now includes Bulgaria, Czechoslovakia, East Germany, Hungary, Poland, and Romania, which are members of the SEV (Soviet Ekonomicheskoy Vzaimopomoshchi, known as Comecon-Council for Mutual Economic Assistance), a highly integrated multinational group. Albania and Yugoslavia, both socialist economies of widely divergent philosophies, are not members of the SEV, although Yugoslavia’s specific status is defined by agreement formalized in 1964. The agreement laid the foundation for Yugoslav participation within the group (it has observer status in half of the Comecon’s 24 Commissions) and cooperation.

The Intra and Inter Industry Trade of Cuba (2000-2014)

2016 ◽  
Vol 17 (2) ◽  
pp. 80-104
Author(s):  
Jorge Alberto Lopez-Arevalo ◽  
Francisco Garcia-Fernandez ◽  
Rafael Alejandro Vaquera-Salazar
Keyword(s):  
United States ◽  
Soviet Union ◽  
Foreign Trade ◽  
Structural Changes ◽  
Raw Materials ◽  
The United States ◽  
Economic Assistance ◽  
The Soviet Union ◽  
Mutual Economic Assistance ◽  
Manufactured Goods

The aim of this study is to analyze Cuba’s foreign trade with three main partners during the so-called Special Period, a result from the dissolution of the Soviet Union in 1991. With the absence of the Mutual Economic Assistance Council (MEAC), Cuba had to make structural changes in its economy and foreign trade. A center-periphery model of doing business between Cuba and its trade partners was implemented. Under this model, China became Cuba’s main supplier of manufactured goods and Cuba supplied raw materials. Foreign trade in Cuba was limited due to the economic embargo from the United States. Nowadays, the relation between these two countries has become more of a trading collaboration. The United States has turned into one of Cuba’s main food suppliers, while Cuba exports art pieces and antiquities to that country. Russia also became a main exporter of manufactured goods and machinery to Cuba, just as China. In return, Cuba is sending raw materials to both of those countries.

scholarly journals Back to the Post-Communist Motherlands

2020 ◽  
Vol 31 (1) ◽  
pp. 52-64
Author(s):  
Israel Bartal
Keyword(s):  
Soviet Union ◽  
Eastern Europe ◽  
Jewish History ◽  
Academic Career ◽  
Middle Eastern ◽  
Historical Research ◽  
Eastern European ◽  
East European ◽  
The Soviet Union ◽  
European Jewish

This article presents some of the personal observations of a veteran Israeli scholar whose long-years' encounters with the 'real' as well as the 'imagined' eastern Europe have shaped his historical research. As an Israeli-born historian of Polish-Ukrainian origin, (the so-called 'second generation') he claims to share an ambivalent attitude towards his countries of origin with other fellow- historians. Jewish emigrants from eastern Europe have been until very late in the modern era members of an old ethno-religious group. One ethnos out of many in a diverse multi-ethnic environment, whose demographic core survived and flourished for centuries in the old places. Several decades of social, economic, and political upheavals exposed the Jewish population to drastic changes. These changes lead several intellectuals who left their home countries to look back at what have happened as both involved actors, and distant observers. Israeli historians of east European origin found themselves confronted with a crucial question: in what way the past in the Old Country connected (if at all) to the history of Israel. Following some 40 years of academic career in the field of eastern European Jewish history, it is claimed that until the collapse of the Soviet Union, the image of eastern Europe that runs through the Israeli historical research has been shaped in large part by members of the different generations of emigrants, outside of eastern Europe. The renewed direct contact after 1989 caused a dramatic change: within a few years, Israeli historians were examining archives and libraries throughout eastern Europe. After seven decades of isolation between the Israeli historian and the primary sources necessary to his/her research in the archives, the new wave of documents was celebrated in Israeli Universities. Yet far more influential was the revolution prompted in 1989 on the historical perspective from which Israeli historians could now examine the Jewish past. What happened in 1989 has seemed, to some Israeli historians, a breaking point marking the end of the eastern European period in the course of Jewish history. The article concludes with some thoughts on a new historical (Israeli) perspective. A one that fits a time when hundreds of thousands of immigrants from what was the largest eastern-European Jewish collective in the world inhabit a remote Middle Eastern nation-state.  

Beyond socialist camaraderie. Cross-border railway between German Democratic Republic, Poland and Soviet Union (1950s–60s)

2019 ◽  
Vol 40 (2) ◽  
pp. 251-269 ◽  
Author(s):  
Falk Flade
Keyword(s):  
Soviet Union ◽  
Individual Member ◽  
Economic Assistance ◽  
Railway Transport ◽  
Economic Interests ◽  
Mutual Economic ◽  
East European ◽  
Cross Border ◽  
Mutual Economic Assistance ◽  
Major Bottleneck

In order to facilitate cross-border railway transport between socialist countries in Eastern Europe, the Council of Mutual Economic Assistance and later the Organisation for Cooperation of Railways were established in 1949 and 1956. Joint planning, standardisation and tariff policy were the main fields of cooperation. The paper focuses on the struggles between Council of Mutual Economic Assistance and Organisation for Cooperation of Railways member countries regarding transit tariffs for cross-border freight shipments. These struggles, dragging on for more than three decades, reveal the economic interests of individual member countries and the limitations of socialist foreign trade (and alleged friendship). This study argues that despite of political declarations and the establishment of socialist international organisations, the East European railways became a major bottleneck in intrabloc trade.

Council for Mutual Economic Assistance

1963 ◽  
Vol 17 (4) ◽  
pp. 988-989 ◽  
Keyword(s):  
Soviet Union ◽  
Raw Materials ◽  
Hard Coal ◽  
Economic Assistance ◽  
Industrial Equipment ◽  
Mutual Economic ◽  
The Soviet Union ◽  
Mutual Economic Assistance ◽  
International Specialization ◽  
Set Up

The Council for Mutual Economic Assistance (COMECON) held its seventeenth session in Bucharest on December 74–20, 1962, attended by delegates from Bulgaria, Czechoslovakia, East Germany, Hungary, Mongolia, Poland, Romania, and the Soviet Union. A communiqué stated that a permanent currency and finance commission had been set up under the Council to develop cooperation in those fields among COMECON member countries, that international specialization and “socialist division of labor” among members had increased, and that during the first nine months of 7962 over-all trade among member countries had risen by 15 percent and trade in machinery and industrial equipment by 24 percent. The communiqué noted that the COMECON countries were now largely self-sufficient in certain raw materials, manufactures, etc., notably lignite, hard coal, oil and oil products, fertilizers, grain, machinery and industrial equipment, and timber.

Centre and Periphery: the Baltic States in Search of Economic Independence

1992 ◽  
Vol 4 (3) ◽  
pp. 249-267 ◽  
Author(s):  
Philip Hanson
Keyword(s):  
Soviet Union ◽  
Adjustment Costs ◽  
Special Problem ◽  
World Market ◽  
Baltic States ◽  
Short Term ◽  
Market Prices ◽  
The Soviet Union ◽  
Independent States ◽  
The Baltic

The short-term economic prospects of the Baltic states (Estonia, Latvia and Lithuania), following their achievement of political independence from the USSR in September 1991, are assessed. They face both the general difficulties of transition to the market and a special problem of disentanglement from the Soviet Union/Commonwealth of Independent States. The paper focuses on the problems of disentanglement, in conditions of rapid inflation and output decline in the Soviet successor-states. These problems arise from (i) around 90 per cent of cross-border merchandise flows being with other Soviet/ex-Soviet republics; (ii) the inter-republic flows constituting around 50 per cent of Baltic GDP; (iii) the Baltic states’ position inside the single rouble currency area, with their money supply outside their own governments’ control. Projections are made of the likely short-term adjustment costs for the Baltic economies of an abrupt shift to trading at world market prices with Russia and other Soviet successor-states, with settlement in convertible currencies. It is shown that the available data on the Baltic states current accounts with the rest of the world in 1988–1989 give an exaggerated impression of adjustment costs but that, even so, the latter are likely to exceed assistance available from the West.

scholarly journals Węgiel w polsko-radzieckich stosunkach gospodarczych

2021 ◽  
Vol 20 (3) ◽  
pp. 93-112
Author(s):  
Janusz Kaliński ◽  
Keyword(s):  
Soviet Union ◽  
Political Transformation ◽  
Economic Assistance ◽  
Economic Relations ◽  
Financial Conditions ◽  
The Soviet Union ◽  
Coal Deposits ◽  
Mutual Economic Assistance ◽  
The 1960S ◽  
Rate Mechanism

Polish coal played an important role in economic relations between the People's Republic of Poland and the USSR. Its resources constituted an important element of the Soviet policy towards Poland. In 1946–1953, the forced deliveries of black fuel were a kind of donation. The Soviet authorities explained them with losses in war reparations as a result of the transfer of German lands on the Oder and Nysa Łużycka to Poland, with rich coal resources in Silesia. The Soviet Union also did not refrain from taking over some of the Polish coal deposits as a result of the forced correction of the borders in the east in 1951. Deliveries of "reparative" coal at lower prices brought Poland serious financial losses and inhibited the development of economic relations with Western countries. The export of coal under trade agreements concluded from 1945 was also economically unfavorable. The Soviet authorities imposed both excessive quotas and difficult financial conditions. From 1949, for this purpose, they used the price and exchange rate mechanism applied by the Council for Mutual Economic Assistance. Only in the 1960s did it become beneficial for Poland, and in the following decades it brought losses. The export of coal to the USSR, which in the 1980s amounted to 30% of total exports, caused a deficit of fuels on the domestic market, made it difficult to use the existing economic potential and maintain an adequate standard of living of the population. The political transformation after 1989, which introduced market regulations to foreign trade, led to the collapse of coal exports to the USSR.

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