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Soviet Union [USSR] The Council for Mutual Economic Assistance
The Soviet Union formed the Council for Mutual Economic
Assistance (Comecon) in 1949, in part to discourage the countries
of Eastern Europe from participating in the
Marshall Plan (see Glossary) and to countereact trade
boycotts imposed after World War
II by the United States and by Britain and other West European
countries. Ostensibly, Comecon was organized to coordinate economic
and technical cooperation between the Soviet Union and the member
countries. In reality, the Soviet Union's domination over Comecon
activities reflected its economic, political, and military power.
In 1989 Comecon comprised ten countries: the six original members--
Bulgaria, Czechoslovakia, Hungary, Poland, Romania, and the Soviet
Union--plus the German Democratic Republic (East Germany, which
joined in 1950), Mongolia (1962), Cuba (1972), and Vietnam (1978).
Albania, although it joined in February 1949, has not participated
in Comecon activities since 1961.
Since 1949 the Soviet Union has traded primarily with other
Comecon members
(see
fig. 25). In 1960 the Soviet Union sent 56
percent of its exports to and received 58 percent of its imports
from Comecon members. From that time, the volume of this trade has
steadily increased, but the proportion of Soviet trade with Comecon
members decreased as the Soviet Union sought to increase trade with
Western industrialized countries. In contrast to 1960, trade with
Comecon members accounted for only 42 percent of Soviet exports and
43 percent of Soviet imports in 1980.
The European members of Comecon have looked to the Soviet Union
for oil; in turn, they have provided machinery, equipment,
agricultural goods, industrial goods, and consumer goods to the
Soviet Union. Because of the peculiarities of the Comecon pricing
system, throughout the 1970s and early 1980s Comecon prices for
Soviet oil were lower than world oil prices. Western specialists
have debated the political motivation of this implicit price
subsidy to Comecon members. The cohesiveness within Comecon members
seemed remarkable when in 1985 the fall in the world price left
Comecon members paying above-market prices for Soviet oil.
The membership of Cuba, Mongolia, and Vietnam in Comecon has
served Soviet foreign policy interests more than the economic
welfare of Comecon members. In general, the more economically
developed European members have supported the three less developed
members by providing a large market for their exports, often at
above-market prices. Most of Cuba's sugar and nickel and all of
Mongolia's copper and molybdenum have been imported by the Soviet
Union. In addition, the Soviet Union has established naval and air
bases in Cuba and Vietnam.
Since 1985 Gorbachev has called for an increase in trade with
Comecon members. At the Twenty-Seventh Party Congress in FebruaryMarch 1986, both he and Prime Minister Nikolai I. Ryzhkov stressed
the need to improve cooperation with the socialist countries on the
basis of Comecon's Comprehensive Program for Scientific and
Technical Cooperation up to the Year 2000. This program
stressed the self-sufficiency of Comecon countries in five key
areas: electronics, automation of production, nuclear power,
biotechnology, and development of new raw materials. It also called
for improvement of plan coordination, joint planning, Comecon
investment strategy, production specialization, and quality of
machinery and equipment exported to the Soviet Union
(see Soviet Union USSR - Appendix B).
Data as of May 1989
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