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Poland Reliance on Technology in the 1970s
In the early 1970s, East-West detente, the accumulation
of
petrodollars in Western banks, and a recession in the West
created an opportunity for Eastern Europe to import
technology
and capital from the West to restructure and modernize its
industrial base. Poland was relatively late in introducing
this
so-called "new development strategy," but it eventually
went
further in this direction than its Comecon allies. The
share of
trade with Comecon declined, and trade with other
countries
increased quite dramatically during the first half of the
1970s.
The technology import strategy was based on the
assumption
that, with the help of Western loans, a large-scale influx
of
advanced equipment, licenses, and other forms of
technology
transfer would automatically result in efficient
production of
modern, high- quality manufactured goods suitable for
export to
the West. Under those conditions, repayment of debts would
not be
difficult. Expansion of exports encountered considerable
difficulties, however, partly because of the oil crisis
and
stagflation in the West, but mainly because the central
planners
remained unable to effect the required changes in the
structure
of production. The investment drive, financed by foreign
borrowing, exceeded the possibilities of the economy.
Removed
from direct contact with the foreign markets, centralized
selection of exportables was ineffective in expanding the
markets
for Polish goods. At the same time, the dependence of the
economy
on imported Western materials, components, and machines
inevitably increased. By the middle of the 1970s, large
trade
deficits had been incurred with the Western countries. The
negative balance of payments in convertible currencies
increased
from US$100 million in 1970 to US$3 billion in 1975.
During the
same period, the gross convertible currency debt increased
from
US$1.2 billion to US$8.4 billion. Unable to expand exports
to the
West at the necessary pace, Polish planners began
centralized
restriction of imports. This policy in turn had an adverse
effect
on domestic production, including the production of
exportables.
Data as of October 1992
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